Starr Motive On Hubbell Questioned
As Presidential friend Webster Hubbell is facing new charges that he evaded income taxes, his recorded conversations from an earlier prison term are likely to cause new concern at the White House.
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They charged Hubbell, his wife and two associates with conspiring to avoid taxes on hundreds of thousands of dollars paid to Hubbell from President Clinton's supporters. Prosecutors want to know if this was "hush money."Hubbel immediately denied the charges.
Within hours of his indictment, The Associated Press obtained transcripts of recorded prison conversations in which Hubbell and his wife worried that his actions might expose Mrs. Clinton to further investigation and cost them White House support.
CBS News White House correspondent Scott Pelley reports that the president and first lady are said to be saddened by the indictment of Hubbell and his wife but see the sweeping indictments as a last-ditch effort by independent prosecutor Kenneth Starr in his persecution of the president.
The White House is saying, Pelley reports that Starr is out to get Hubbell in an effort to get him to testify against the Clintons. Hubbell apparently had the same beliefs.
"My wife and I are innocent," a solemn Hubbell said outside his Washington home with his wife, Suzy, at his side. "The office of independent counsel could indict my dog. They can indict my cat. But I'm not going to lie about the president. I'm not going to lie about the first lady or anyone else."
The 10-count grand jury indictment charged Hubbell with evading taxes on income he received from Clinton friends and political supporters who sought to assist him after he resigned as associate attorney general. "By late 1997, the taxes, interest and penalties for 1989-1992, 1994 and 1995 exceeded $894,000," the indictment said.
Among the fees Hubbell received was $100,000 from the Riady family of Indonesia. Former White House chief of staff Mack McLarty, current chief of staff Erskine Bowles and ex-Commerce Secretary Mickey Kantor have all acknowledged trying to help Hubbell find the work.
Prosecutors' suspicion about those fees, along with their frustration over Hubbell's memory lapses after he agreed to cooperate with prosecutors in Little Rock, reportedly led to the new investigation.
Thursday's indictment was returned 14 months after Hubbell, a golfing partner of the president and former law parner of Mrs. Clinton, was released from his incarceration on charges he defrauded the Rose Law Firm in Little Rock, Ark., where he and the first lady used to work. The tapes that were released Thursday night were made during that prison term.
Hubbell's attorney, John Nields, decried the new indictment as excessive and said average Americans never would have been charged in such a case.
"He has now paid his debt to society. He has confessed. He has been punished and his family has been brought to financial ruin and, as he tries to pick himself up off his knees, the office of independent counsel comes around and tries to prosecute him again," Nields said.
The indictment accused the Hubbells, accountant Michael C. Schaufele of Little Rock and Little Rock tax lawyer Charles C. Owen of conspiracy, tax evasion, impeding and impairing the Internal Revenue Service and mail fraud.
It said the four tried to "evade and defeat the payment of a large part of the income tax due" by the Hubbells from 1989 to 1992 and 1994-95.
Schaufele also was accused of aiding in the preparation of a false tax return.
In Little Rock, Schaufele said he was "pretty shocked" by the indictment. "I know that I really didn't do anything wrong," he said.
©1998 CBS Worldwide Corp. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report