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Legal Foundation Says it Filed Complaint Against Mrs. Clinton

October 25, 1996

LITTLE ROCK, Ark. (AP) _ A conservative legal foundation has asked a state committee to examine whether Hillary Rodham Clinton violated the code of legal ethics as a lawyer preparing a real estate document 10 years ago.

The Landmark Legal Foundation said it filed an ethics complaint Thursday asking the Arkansas Supreme Court’s professional conduct committee to investigate Mrs. Clinton’s role in preparing the document, which the Federal Deposit Insurance Corp. said was used to mislead regulators.

``There is a whole set of rules, rules of professional conduct, that exist in each state. We’ve asked the committee to look into this matter,″ said Mark Levin, who said he filed the complaint.

The committee, which would not confirm whether the complaint has been filed, can take action ranging from a public letter of caution to initiating disbarment proceedings in court. The committee meets in private and doesn’t announce details of a proceeding until it decides on a course of action.

The Federal Deposit Insurance Corp. concluded in a report last month that the document drafted by Mrs. Clinton in 1986 was used by Madison Guaranty Savings & Loan to mislead regulators and hide commissions it was paying to a prominent businessman. Mrs. Clinton was not accused of any wrongdoing.

Landmark represents Jean Lewis, who, while working for the federal Resolution Trust Corp. in 1992 and 1993, pursued a criminal investigation of Madison. Madison was owned by James and Susan McDougal, Whitewater business partners of President Clinton and the first lady.

The document Mrs. Clinton helped draft put a $400,000 price tag on vacant land south of Little Rock. But the 22.5-acre parcel fetched a mere $38,000 when the federal government _ in the bailout of the S&L industry _ unloaded it in the early 1990s.

Over the years, the property, called Holman Acres, was assigned values between $70,000 and $170,000, records show.

Neal Lattimore, a spokesman for Mrs. Clinton, did not return immediately telephone calls left for him.

Whitewater criminal investigators are looking into whether the land price was inflated as part of a scheme by Madison to disguise improper real estate commissions to businessman Seth Ward.

Ward is the father-in-law of Webster Hubbell, a former law partner of Mrs. Clinton. Hubbell, a former associate attorney general, is in prison for bilking clients while he was at the Rose Law Firm in Little Rock.

Mrs. Clinton said in sworn answers earlier this year that she recalls nothing about her work on Holman Acres, but conceded that word processing codes on the documents indicated at least some of them were produced by her.

``I do not believe I would have drafted such real estate documents from scratch,″ Mrs. Clinton said. ``I have no recollection of who may have asked me to prepare these documents.″

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