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Altman Resigns in Whitewater Aftermath; Treasury Counsel Next

August 17, 1994

WASHINGTON (AP) _ Deputy Treasury Secretary Roger Altman resigned under intense pressure Wednesday, saying he hoped his departure would diminish the Whitewater controversy that has weakened President Clinton. Treasury’s top lawyer, Jean Hanson, was expected to resign as well.

Altman, the latest administration official and presidential pal felled by Whitewater, made his decision after harsh criticism from Democratic and Republican lawmakers who called his marathon testimony on the affair misleading.

″As I explained to the Senate,″ Altman said in a letter to Clinton, ″I regret any mistakes or errors of judgment I may have made. For them, I apologize. And, hopefully, my stepping down will help to diminish the controversy.″

In reply, Clinton said, ″I believe you have taken the right step under the circumstances and I regretfully accept your resignation″ - effective upon the confirmation of a successor. Clinton said Altman had ″made many valuable contributions to this administration.″

While the administration had pressured Altman to quit, White House press secretary Dee Dee Myers said, ″This was Roger’s decision.″

Altman, who attended college with Clinton, informed the president of his decision by telephone. Hanson has told colleagues she will resign, perhaps as soon as Thursday, according to administration officials speaking on condition of anonymity.

Altman’s action came two weeks after televised congressional hearings that embarrassed the administration and threatened to damage Clinton’s effectiveness on Capitol Hill.

Altman was denounced by lawmakers for what one called his ″ethical high- wire act″ before the banking committees. Hanson was rebuked for failing to immediately correct errors she knew Altman had made in earlier testimony. Both denied intentionally misleading Congress.

One of Clinton’s harshest critics, Republican Sen. Alfonse D’Amato of New York, said, ″It’s about time Altman resigned.″

The chairman of the Senate Banking Committee, Democrat Donald Riegle of Michigan, said Altman’s ″ability to serve the president had been damaged″ and he was right to resign.

Another old Clinton friend, Bernard Nussbaum, was resigned under pressure last spring for his role in the Whitewater affair as White House counsel. A billing dispute in Arkansas spilled over into the controversy and prompted Arkansas lawyer and Clinton pal Webb Hubbell to resign as associate attorney general.

At issue in the congressional hearings were contacts between the White House and Treasury about a confidential investigation into a failed Arkansas savings and loan and its ties to the Clintons and their land development company, Whitewater. A special prosecutor cleared Hanson and Altman of criminal wrongdoing and the Office of Government Ethics said the pair did not violate ethics rules.

Altman, who oversaw the federal Resolution Trust Corp. inquiry in Whitewater until this spring, declined comment on the resignation at a ceremony unveiling a new postage stamp. But he kept his sense of humor, earning a roar of laughter when he looked at the crowd of reporters and photographers and quipped, ″I didn’t know so many members of the media were stamp collectors.″

The former Wall Street investment banker, who has known Clinton since their days at Georgetown University, was an early star in the administration. He helped steer the president’s budget package through Congress last year and had been considered a potential successor to Treasury Secretary Lloyd Bentsen.

The administration, which waged a whisper campaign to get Altman to resign, did not waste time thinking about a replacement, floating the name of Frank Newman last weekend as a possible successor. Newman is undersecretary of the Treasury for domestic finance.

To Altman’s intense embarrassment, excerpts from his personal diary were put in the public record at the hearings. He had written that first lady Hillary Rodham Clinton was ″paralyzed″ by the Whitewater affair.

Well before his decision to resign, Altman apologized to the Clintons for the way he handled the matter.

Testifying this month, Altman said he regretted that his original statement to Congress ″may appear too narrow or perhaps incomplete.″

Altman’s trouble started in early 1993 when he was made interim head of the Resolution Trust Corp., an independent agency investigating failed savings and loans. As a political appointee at Treasury overseeing an RTC investigation involving the president, his boss, Altman was on the spot.

He had considered excusing himself from the Whitewater inquiry, but was urged not to do so by Nussbaum, who said there was no reason for Altman to step down. Republicans accused the White House of pressuring Altman to stay aboard, keeping a friendly hand in the inquiry.

Under congressional questioning in February, Altman was the first to reveal Whitewater-related contacts between the White House and Treasury. But at first, he acknowledged just one. He amended his testimony several times later to add more contacts.

Hanson, who sat behind Altman during the testimony, knew he had erred but did not move immediately to get him to amend his statements. In her own testimony, she suggested Altman and Bentsen knew about the contacts earlier than they had said.

Bentsen’s boyish chief of staff, Joshua Steiner, apparently will not be pushed out but may be reassigned. At the hearings, he disowned passages in his own diary that talked about pressure applied on Altman by the White House.

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