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McDougal Remains Defiant

Susan McDougal spoke defiantly before the start of her trial on contempt and obstruction of justice charges, saying she believes Independent Counsel Kenneth Starr has it in for her.

"I think it will be an all-out fight and I think it has become a personal vendetta," McDougal said. "It's become more than political. I'm scared this morning."

McDougal made her comments Monday as she arrived at the federal courthouse for jury selection in a proceeding that could send her back to prison. She has repeatedly insisted she has no information on business dealings involving President Clinton and the first lady.

McDougal already has served 18 months on a civil contempt citation. She is in court again for refusing to answer Starr's questions about the Clintons. Prosecutors are alleging criminal contempt and obstruction of justice.

Five potential jurors were dismissed Monday morning, including one who said she couldn't be a fair juror.

"If I was in Mrs. McDougal's shoes, I would not want me on the jury," the woman said.

If convicted, she could go back to jail and be fined up to $750,000. But her lawyer says McDougal won't be broken.

"I would say that Susan's resolve is as strong as it's always been," said Mark Geragos. "She understands the consequences."

Grand jurors were investigating whether McDougal had improper financial dealings with the Clintons when the president was governor of Arkansas. McDougal and the Clintons were business partners in the failed real estate development known as Whitewater.

McDougal has said she refused to answer questions because she believes Starr would twist her words to suit his own purposes and might charge her with perjury if he doesn't get the testimony he wants.

U.S. District Judge George Howard Jr. said last week that he would consider allowing evidence of "prosecutorial misconduct or outrageous government conduct," specifically whether Starr wanted McDougal to lie about the Clintons.

Deputy Independent Counsel Hickman Ewing Jr. was unfazed. "We know in any high profile case, it is a normal thing where the prosecutor is attacked," he said.

Prosecutors will introduce evidence that McDougal had relevant information on the Clintons in regards to Whitewater, Ewing said. According to the indictment, prosecutors want to know:

  • If President Clinton was aware of a $300,000 loan to Mrs. McDougal from David Hale, who pleaded guilty to mail fraud and conspiracy. Hale said Clinton pressured him to make such a loan in 1986. The government claims Mrs. McDougal used the money for purposes other than those for which it was intended.
  • Whether the Clintons knew about Lorance Heights, an 800-acre tract south of Little Rock that the Clinton's and the McDougal's Whitewater Development Corp. purchased in 1986. Prosecutors say the company used money from the $300,000 loan to secure the land. The Clintons have said James McDougal, Mrs. McDogal's late husband, never told them about Lorance Heights or the loan.
  • If Mr. Clinton testified truthfully during the 1996 trial of Mrs. McDougal, her husband and then-Gov. Jim Guy Tucker.
  • Why the words "Payoff Clinton" were written in the notation section of a $5,081.82 check drawn on a McDougal account and payable to Madison Guaranty, which the McDougals owned.

Jury selection is expected to continue through most of the week.