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Panel Gets New Details on Clinton Ties to Investment Banker

April 8, 1996

WASHINGTON (AP) _ Before their work was halted five weeks ago, Senate investigators gathered evidence about the ties between then-Arkansas Gov. Bill Clinton and an investment banker lobbying for state business _ a topic that has long caused the president political problems.

Before its authority expired Feb. 29, the Senate Whitewater Committee was looking into a 1985 meeting at which the banker, Dan Lasater, made a blunt pitch to Clinton for state bond contracts.

The panel was examining internal memos from the governor’s office showing that Clinton and his aides kept a close eye on Lasater’s efforts to win state work.

Documents from the governor’s office include a letter by Lasater to Clinton asking for monthly meetings and advance notice of opportunities to bid on state bond business. Lasater wrote the letter weeks before it was disclosed in federal court that he had helped pay off a drug debt for Clinton’s younger brother, Roger.

A few months later, Clinton and his aides monitored Lasater’s progress in securing a piece of the state bond business to finance a proposed $30 million state police communications system.

The data assembled by Senate investigators could provide a new avenue for Whitewater hearings once they resume. Democrats and Republicans have not agreed how to extend the investigation.

Lasater contributed to Clinton’s gubernatorial campaigns and hired Roger Clinton. Lasater and Roger Clinton became the focus of a drug investigation, and both pleaded guilty to cocaine charges and went to prison.

The state contracts, the drugs and the ties to Roger Clinton have long made Lasater a political issue during Clinton’s campaigns for governor and president.

Lasater, who has been questioned by Senate investigators, participated in 15 state contracts but says that, overall, the business wasn’t profitable.

In a recent interview with The Associated Press, Lasater said he sought a private meeting with Clinton in 1983 or 1984 because other bond houses had been getting favorable treatment from state agencies and he wanted the governor ``to level the playing field.″

``We tried to make as much hay as we could with Clinton and tried to get as much business as we could, but it never worked,″ Lasater said.

He said he told Clinton, ``Look, we are the second-largest capitalized firm in the city (Little Rock) and we’re not doing any of this business, and I think we are entitled to some of it.″

According to Lasater, ``Clinton said that he’d look into it. He made no commitments at all and it didn’t help us any at all.″

Internal memos from the governor’s office reveal new information about the state police communications contract.

Days after the state police commission awarded the work to Lasater and two other bond houses, a state lawmaker suggested the project might be better financed through other means.

That prompted Clinton’s chief of staff, Betsey Wright, to alert the executive vice president of Lasater’s company, Michael Drake, according to a memo reviewed by the AP. The memo said Wright urged the firm to jump into the fray to keep the project on track.

``I have suggested″ that executives at the firm ``get″ an Arkansas state police commissioner to contact the lawmaker, Wright wrote Clinton on May 13, 1985.

Wright said Clinton’s office never favored Lasater and never had monthly meetings with his firm, but did direct agencies to invite more bond houses to bid on state business to increase competition.

The former chief of staff said she contacted Drake in order to get the state police communications system built quickly. Reopening the debate over how to finance the project would have meant lengthy delays, she said.

Of eight competitors on the project, the proposal submitted by E.F. Hutton, Lasater and a third company won the contract.

Lasater’s firm got a $115,000 management fee for the contract but lost money on the deal, Lasater and Drake said.

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