Lesson of Clinton Fund-Raiser: Double-Check That Donor List
By RAYMOND HERNANDEZ and IAN URBINA
Published: February 9, 2005
ASHINGTON, Feb. 8 - In August 2000, Bill and Hillary Clinton attended a Hollywood fund-raiser billed as a tribute to a president ready to leave the White House after eight years and a first lady seeking to establish herself as a force of her own in American politics.
The guest list reflected the glitter of the occasion: Cher, Diana Ross, Brad Pitt and Patti LaBelle, to name just a few. But a person who later emerged as perhaps the most memorable - to the Clintons and their associates, anyway - was a well-connected figure with a checkered past who helped organize the event. He is Peter Paul, a man who pleaded guilty to cocaine possession and trying to defraud Fidel Castro's government out of millions of dollars in 1979, among other things.
Mr. Paul said he spent nearly $2 million of his own on the fund-raiser as a way to curry favor with Mr. Clinton, and photographs show him chatting with Mr. Clinton at a dinner table, having a discussion with Mrs. Clinton and striking poses for the camera with both of them.
Associates of the Clintons say the couple did not know of Mr. Paul's troubled past at the time, and in the months after the event, Mr. Paul turned on the Clintons, later urging investigators to look into the fund-raiser.
Last month, the federal investigation produced an indictment charging that the cost of the affair had been underreported.
The case offers a bizarre and tangled tale of how Mr. Paul, a smooth operator with myriad connections and a troubled past, got so close to America's first couple in a political culture dominated by money. It also shows the continuing effort of a longtime nemesis of the Clintons, Judicial Watch, a conservative legal group, to make legal trouble for the couple.
A spokesman for the Justice Department, Bryan Sierra, said in a recent interview that Mrs. Clinton was not a subject of the investigation that led to the indictment, which named not Mr. Paul, but another person connected to the event, David Rosen, the finance director of Mrs. Clinton's Senate campaign, who is accused of underreporting the cost of the fund-raiser. No one else has been accused of any wrongdoing arising from the accusations.
Beyond that, people involved in Mrs. Clinton's 2000 campaign expressed bafflement at the indictment, not only noting that prosecutors had failed to state Mr. Rosen's motive but also arguing that Mr. Rosen did not, in fact, have a motive, since underreporting the contributions would not have produced any financial benefit for Mrs. Clinton's campaign under a complicated series of campaign-finance rules.
But one official at the Federal Election Commission disagreed, saying that there was a possible advantage to underreporting such contributions in a case like this: to have more money to spend on the campaign itself.
In addition, Clinton advisers say that Mrs. Clinton's campaign had no idea about Mr. Paul's troubled past until after the gala - and that Mr. Paul was involved only because of his association with a successful Internet company he started with the co-creator of Spider-Man, Stan Lee, who was listed as one of the co-hosts of the event. One Clinton adviser described Mr. Lee as "an American icon."
Mrs. Clinton's advisers referred questions to David Kendall, a lawyer for the Clintons. Mr. Kendall dismissed Mr. Paul's claim that a deal had been struck to have the President assist Mr. Paul in his business dealings provided that Mr. Paul raised money for Mrs. Clinton's campaign. "There was never any kind of quid pro quo," he said.
During an interview he gave to The New York Times in 2001, Mr. Rosen himself expressed bewilderment at how far Mr. Paul got. "I've never seen a guy like this," Mr. Rosen said. "I wish I'd never bumped into him in the first place." Mr. Rosen did not return two more recent phone calls requesting comment on the matter.
Mr. Paul's past is certainly colorful. Two decades ago, he served 42 months in federal prison and his law license was suspended after he pleaded guilty to cocaine possession and trying to defraud the Cuban government out of $8.7 million in a complicated scheme involving coffee sales to the Soviet Union from Cuba.
By 1999, Mr. Paul teamed up with Mr. Lee to create Stan Lee Media, a multimedia company based in the San Fernando Valley that, among other things, introduced animated superheroes on the Internet.
