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Robbing Peter to Pay Hillary
The Media Cover-Up of the Largest Campaign Finance Fraud in US History
The Fraudulent Senator: Part 5 of a 7 Part Series
Media/Noel Sheppard
March 17, 2006
To many Americans, Tom DeLay and Jack Abramoff are the faces of corruption
in politics today. Sadly, if the media had done its job the past five and
half years, the picture of campaign finance fraud would be a poorly dressed
blond woman from Arkansas that used to be the First Lady, but never became
the junior senator from New York.
Few truly objective observers of politics on either side of the aisle would
disagree with the premise that the Clintons have consistently drawn an
excessive amount of media attention since their meteoric rise onto the
national scene in the early '90s. One could likely find a consensus even
among Democrats when there wasn't a microphone or camera around that the
bulk of such coverage has almost always been quite favorable even when the
facts didn't warrant it.
On the flipside of this media fascination is a hypocritical compulsion by
the press to shelter the Clintons from negative scrutiny whenever possible.
Examples of this are so numerous and apparent they need no reiteration.
However, one event involving likely the largest case of campaign finance
fraud in American history has been so obfuscated by the media that many of
the players involved will be unfamiliar to even the most savvy political
observers.
As a result, one of the largest scandals involving the Clintons has gone
almost thoroughly ignored by America's press. When the first reports were
published, they were so minute in scope and visibility that the voters of
New York State had no idea who they were putting into office, and might have
voted differently if they had been properly informed.
Since then, most media outlets that have deemed this story worthy of print
and/or airtime have either through incompetence or deceit glossed over or
misrepresented much of the facts in an effort to protect politicians they so
transparently revere.
In the end, what makes this so reprehensible is that the Hillary Clinton
campaign finance activities the media have been covering up dwarf those of
former House majority leader Tom DeLay (R-Texas), and any of the members of
Congress who took funds from former lobbyist Jack Abramoff. Yet, both of
these issues have spent months as the lead stories of America's print and
television news media, while the Clinton chicanery has not. As a result, the
behavior of the media is just as corrupt as those they were trying to
protect.
What follows is an examination of how the media covered up the largest
campaign finance fraud in American history, and in so doing, helped elect a
former First Lady to the Senate, paving the way for her possible
presidential candidacy.
The Hollywood Farewell Gala For President William Jefferson Clinton
Our story begins on August 12, 2000, when a man whose name is unfamiliar to
probably 99 percent of the American people threw a fabulously luxurious and
massively expensive party for the Clintons in Brentwood, California, a posh
area just outside of Hollywood.
In attendance, as well as performing for the Clintons' entertainment, were
such Hollywood luminaries as Cher, Shirley MacLaine, Whoopi Goldberg, Patti
LaBelle, Jimmy Smits, Sugar Ray, Red Buttons, Toni Braxton, Angelica
Houston, Melissa Etheridge, Dylan McDermott, Alfre Woodard, and Michael
Bolton. Also on hand were John Travolta, Patrick Swayze, newlyweds Brad Pitt
and Jennifer Aniston, Milton Berle, Olivia Newton-John, Carol Burnett, David
Spade, Laura Dern, Michael York, Frances Fisher, Angie Dickinson, Rod
Steiger, Kathy Bates, Camryn Manheim, Ed Asner, Robert Wuhl, Richard Lewis,
and Annabelle Weston.
The event cost $1,000 per ticket, and $25,000 per couple for the dinner. All
of the funds raised were going to Hillary's New York senatorial campaign,
although the gala was dubbed as a going away party for the president
inasmuch as he was in the final months of his second term.
After the festivities, People magazine reported: "In politics, there are
Parties--and there are parties. The place to be--by a landslide--on Aug. 12
was the Robert Taylor Ranch in Los Angeles, where more than 1,000 Friends of
Bill, from Gregory Peck to Brad Pitt, kicked off a Democratic National
Convention week of high-profile bashes (including one on the set of NBC's
The West Wing) with a salute to President Clinton." On the same day, US
magazine did a spread of the gala as well.
This event was so huge that The New York Times included details about it in
a front page pre-Democratic presidential convention story two days before it
occurred: "The headline event is Saturday night at a private Los Angeles
estate. More than 1,400 people will attend a salute to the president, with
the proceeds going to Mrs. Clinton's Senate campaign." As amazing as it
might seem, this was the last time the Old Gray Lady would refer to this
gala, or any of the fraudulent campaign finance activities surrounding it
until February 2005.
Who was the man responsible for this gala? Peter F. Paul, a former
international lawyer, entrepreneur, and entertainment mogul with ties to
presidential administrations dating back to Richard Nixon. Of course, it's
no surprise that you haven't heard of Paul, for a LexisNexis search of all
reports containing the names "Peter Paul" or "Stan Lee Media" (Paul's former
company) or "David Rosen" (Clinton's former campaign finance director) and
"Hillary Clinton" since this gala occurred identified only 458 reports by
all media outlets. 368 of these stories were published after Rosen was
indicted for his involvement in this scandal on January 7, 2005.
By contrast, the name Jack Abramoff received more than 1,000 results for
just 2006 alone. And, in just the 24 hours following the announcement of Tom
DeLay's indictment in September 2005 there were 859 media reports on the
subject. Compare that to only 26 media reports in the 24 hours following
Rosen's indictment roughly eight months earlier, and one can see an almost
unbelievable and thoroughly inexplicable disparity in the press' coverage of
these events.
Why the blackout concerning this issue? Well, on top of the indictment of
Hillary's campaign finance director, the Clintons are also being sued by
Paul in California Superior Court for "fraud, deceit, negligent
misrepresentation, unfair business practices, unjust enrichment, and civil
conspiracy," and it appears that America's press are not interested in
reporting the existence of these cases or the facts surrounding them.
(The reader should be aware that using LexisNexis to "count" media reports
is not a completely accurate measurement, as some articles and/or newscasts
can be duplicated using this website for such a purpose. Also, wire services
like the Associated Press may publish multiple versions of the same story
throughout a given day, and each of these counts as a report in such a
search. However, for purposes of comparison, such an analysis has tremendous
value despite not being 100 percent precise.)
The Largest Campaign Finance Fraud in American History
As the root issue for this lawsuit is noncompliance with federal election
laws and what constituted campaign finance fraud, it is important for the
reader to understand at the onset some of the economics behind this gala
fundraiser, and how they ended up being falsely reported to the Federal
Election Committee.
The contributions received that fateful August evening in 2000 according to
Paul's lawsuit totaled $1.5 million. Paul's costs associated with the
fundraiser, which by FEC law constituted contributions as well, were $1.9
million -- "not including the fair market value of his own services in
acting as executive producer of the event and the fair market value,
estimated at an additional $1 million, of the services rendered by eight (8)
world class artists who performed at the concert portion of the event."
Without getting confusingly complex, FEC laws distinguish between "hard
dollars" and "soft dollars" raised by a candidate for campaign purposes.
Hard dollars carry a $2,000 per contributor limit; soft dollar contributions
from an individual have a $25,000 limit, and; corporate contributions have
no dollar limit, but are restricted to national committees and PACs while
being restricted from specific candidates. In addition, soft dollars are
supposed to be used by the national party of a candidate to exclusively
promote issues of the party. By contrast, hard dollars can be used for the
sole benefit of the candidate to promote his/her election goals, including
running media ads, sending mailers, organizing phone banks, etc. As a
result, hard dollars are extremely precious.
Of course, candidates and their parties for years have figured out ways to
rig the system thereby using soft dollars for purposes that operate in the
gray areas of the regulations. The reader might recall a well-publicized
incident that occurred during a September 2000 New York senatorial debate
between Hillary Clinton and her Republican opponent, Rick Lazio (R-New York)
dealing with this very issue. To make a point, Lazio approached Clinton
demanding that she sign a document agreeing to not use soft dollars for her
campaign. Hillary didn't sign this at the time, but finally acceded on
September 24.
With that in mind, as former Clinton advisor Dick Morris wrote in an April
2005 article entitled "How Hill Gained," "Under the arcane rules of the
Federal Election Commission at the time, campaigns could use soft money to
pay for fund-raising events - provided the gathering's costs came to 40
percent or less of the total of hard money raised." In the case of this
gala, as it raised a total of $1 million hard dollars according to Morris,
the Clinton campaign would have only been able to use $400,000 of soft
dollars to cover the cost of the fundraiser. Using Paul's expense figure of
$1.9 million, this would have cost the Clinton campaign $1.5 million in hard
dollars.
Now, it appears that there is some confusion as to what the real cost of
this gala fundraiser was. Morris used the figure presented in an FBI
affidavit of "at least $1.2 million," and estimated that this would have
cost the Clinton campaign about $800,000 in hard dollars. Regardless of
which number is correct, given Hillary's agreement to not use soft money in
the campaign, as Morris put it, "she was hard up for hard money. So if
[national finance director for the Clinton campaign David Rosen] had owned
up to the full cost of the fundraiser, the campaign would have had to cough
up $800,000 of hard money at exactly the time that it needed the funds the
most."
To prevent this from occurring, the Clinton campaign decided to drastically
understate the cost of this event by declaring to the FEC on October 15,
2000 that it had received $366,564.69 from Stan Lee Media, Inc., the company
that Paul was a partial owner of at the time. Not only did this figure
conveniently fall below the 40 percent soft dollar limit, but also the use
of "Stan Lee Media, Inc." as contributor allowed the Clinton campaign to
deny and obfuscate its direct connection to Paul.
Of course, another issue to keep in mind is that according to an FEC
complaint filed by Paul on July 16, 2001, "Federal Election Commission
records for year 2000 reported political contributions by Peter F. Paul
reflect a total contribution of $2000.00, which was returned." Paul's
lawsuit contends that since the Clinton campaign in essence reported zero
dollars received from Paul in the year 2000, it should be required to
reimburse to him the $1.9 million he spent on this gala fundraiser. Also,
because his contribution exceeded the $25,000 soft money limit to
individuals, the excess over that amount should be immediately refunded.
The Party's Over
Likely before all the hangovers caused by this gala were recovered from, The
Washington Post dropped a bombshell that none of the participants expected.
On August 15, 2000, Post writer Lloyd Grove wrote the following in his "This
Just In" column:
"Is Hillary Clinton soft on crime? We certainly hope not, even though
convicted felon Peter Paul--who served three years in prison two decades ago
after pleading guilty to cocaine possession and trying to swindle $8.7
million out of the Cuban government-- helped organize Saturday's
star-glutted $1 million fundraising gala for Clinton's Senate race at
businessman Ken Roberts's Brentwood estate. Paul, co-founder of Stan Lee
Media, told us in a statement: 'As a young international lawyer and active
anti-communist, working in a politically charged environment, I got caught
up in a vicious interagency rivalry concerning a covert operation against
Castro's Cuba.' He added that he only produced the gala and hasn't given or
raised money for the first lady's New York campaign. And we will not be
accepting any contributions from him,' Clinton campaign spokesman Howard
Wolfson vowed."
This statement by Wolfson was quite curious, as it implied that the Clinton
campaign was surprised to find out about Paul's past. After all, Hillary
was, at that time, married to the president of the United States. Wouldn't
the background of anyone throwing a high-profile party for the president,
and being allowed to get so close to him and his family be properly vetted
by his staff? They didn't check Paul's Social Security number which would
have immediately identified his prior convictions? In addition, Paul had
previously hosted two fundraising events for Hillary, and one for Vice
President Al Gore. How could Paul's past not have properly vetted for these?
This is especially curious given the article that TIME magazine did on
February 12, 1979 entitled "The Cuban Coffee Caper," chronicling events that
Paul was involved in. Yet, the Clinton administration first found out about
Paul's participation in this "caper" when The Washington Post reported it
three days after the gala? This appears implausible, and is called into
serious question as the article ensues.
Grove followed up his August 15 column two days later largely it seems to
give the Clinton campaign the ability to correct some "fallacies" while
driving home the point that Paul was a "convicted felon":
"Senate candidate Hillary Rodham Clinton's press secretary misspoke--and
convicted felon Peter Paul apparently misremembered--when they told us this
week that Paul produced Saturday's star-glutted million-dollar fundraiser
but didn't personally give money to Clinton's campaign.
"'I stand corrected,' Clinton spokesman Howard Wolfson said Wednesday after
we located Federal Election Commission records showing that the
fifty-something Paul donated $ 2,000 to Clinton's Senate campaign on June
30. 'He had previously given, but not associated with this event, and today
we returned the check,' Wolfson said."
Grove's article, after relieving Clinton from guilt, then spent the bulk of
the allotted space on Paul, including what he paid to Hillary's campaign:
"A sometime show-business talent manager who co-founded Los Angeles-based
Stan Lee Media, Paul describes himself as 'an Internet guru.' Paul said
producer Aaron Tonken, who helped organize the fundraiser at businessman Ken
Roberts's Brentwood estate, must have sent candidate Clinton the money on
Paul's behalf. 'Aaron had me write checks for a lot of things, and I didn't
pay attention,' Paul said. Tonken didn't return our phone calls seeking
comment.
"Paul was paid 'a nominal fee' for his producing services, he said, and
Wolfson said Stan Lee donated $ 100,000 to cover some expenses for the
event. As for the rest of the estimated $ 1 million-plus cost, 'it was an
in-kind contribution . . . and not a check,' Wolfson said."
According to Paul, the statements he made to Grove in both of these pieces
were orchestrated by the Clinton campaign. "I was told by DNC Chair Ed
Rendell, after the Clinton camp heard from Grove and formulated their story,
before I spoke to Lloyd Grove, that I should not admit to paying for the
gala and go along with the Clinton story that they weren't taking any money
from me." In his view, the only way to protect the money he had contributed
was to accede to their "request." "I effectively was coerced to go along
with their story in order to protect the almost $2 million investment I had
just made in the business relationship," he said.
Also according to Paul, Grove had admitted to him that his source for Paul's
troubles with the law was Paul's former partner and romance icon, male model
Fabio and his new manager. The pair had a falling out in 1995 when Paul sold
Fabio his management agreement. In 1997, Paul and Fabio got into a shouting
match on Howard Stern's radio show, and there's been a lot of bad blood
between them since.
Paul received a tip from a friend at the Hollywood Reporter that after Fabio
heard about the gala Paul was throwing for the Clintons, he figured this
would be a great time for a little vindication. So, he contacted Grove to
stir up some muck.
That said, the most important element of Grove's second article was that
final paraphrased statement by Wolfson concerning the $1 million-plus cost
of the gala, and that this was an "in-kind contribution"; this is
significantly greater than the approximately $367,000 the Clinton campaign
declared roughly two months later to the FEC.
As a clarification, the term "in-kind" means that the contribution did not
come in the form of cash, check, or a credit card transaction. Instead, the
FEC requires candidates to submit detailed accountings of goods and services
provided to them by donors to assess their value, which is then reported as
an in-kind contribution.
This is a important issue for the reader to understand: On August 16, 2000,
Howard Wolfson, a key spokesman for Hillary Clinton who still works in this
capacity, told The Washington Post that the gala fundraiser in Hollywood
cost over $1 million, and was an in-kind contribution. Yet, two months
later, the campaign reported to the FEC that the gala cost $367,000, and was
contributed by Paul's company NOT by Paul. Yet, we now know from a January
30, 2006 amended filing by Hillary's campaign to the FEC that this number
was fraudulently underreported by $831,000, and that these funds all came
from Paul's personal holding companies and NOT Stan Lee Media.
That in a nutshell represents the fraud that the media have been assisting
Hillary and her minions to cover up for the last five and a half years.
This cover up began on August 15, 2000 when no other major media outlet
bothered to report what The Washington Post revealed in these two articles,
or further explore the allegations contained in these articles prior to
Election Day 2000 or since. (According to LexisNexis, the only other press
outlet to pick up this story before November 7, 2000, was Bulletin
Broadfaxing Network on August 16.) This is especially true for the New York
papers whose readers would be the most impacted by this information. In
particular, as The New York Times had previously reported the existence of
this gala, why did its editors think that it wasn't important to inform the
public that it was hosted by a felon, or that the numbers being reported by
the Clinton campaign to the FEC concerning its cost were suspect?
Regardless, according to Paul, after the Post articles were published, the
next media contact didn't come until well into 2001. As a result, almost
three months before Election Day 2000, the wife of the president of the
United States, who also happened to be running for a senate seat in one of
America's largest states, admitted to taking campaign money from a felon.
Almost two months later, her campaign officials fraudulently underreported
and misattributed the origin to the FEC contributions it had received -
information that was available to the public and to the press at the FEC
website on October 15, 2000. And, this number was one third as much as
Hillary's spokesman had told The Washington Post.
Yet, for some reason, the Post chose not to follow up on its own story. Why
was that? After its first piece on August 15, 2000, somebody at the Post
"located Federal Election Commission records showing that the
fifty-something Paul donated $ 2,000 to Clinton's Senate campaign on June
30." In doing so, the Post caught the Clinton campaign and its spokesman in
a lie. As such, why didn't the Post continue to follow up on this story by
regularly checking FEC records to verify how the contributions from this
million-dollar gala were reported? Wouldn't that have been sound
investigative journalism, or is that asking too much?
Similarly, as the Post had caught the Clinton campaign in a lie concerning
its fundraising activities surrounding a convicted felon, how could the rest
of the media totally ignore this eleven weeks before Election Day? This
preposterous lack of media curiosity included "The Most Trusted Name in
News," or what people used to refer to as the "Clinton News Network," for
according to LexisNexis, CNN's first report on this subject didn't occur
until 2005 when Hillary's campaign finance director David Rosen was
indicted. Imagine that!
What's Good for the Clintons Isn't Good for the Bushes
To put this in proper perspective, try to imagine what would have occurred
if similar allegations with an admission, along with a fundraising
misstatement by a key spokesperson, had been published at the same time
about Hillary's opponent, Rick Lazio, or any other Republican candidate
including George W. Bush. Would the media have ignored those revelations?
Hardly.
As a perfect example of how absurd this Clinton fundraising media blackout
was, consider that on September 8, 2004, roughly two months before Election
Day, CBS's Dan Rather reported about documents relating to President Bush's
air national guard service. In the next 24 hours, there were 559 reports on
this subject by media outlets prior to the revelation that the documents had
been forged. And, this was regarding events that had transpired almost four
decades prior.
Or, consider that on Thursday, November 2, 2000, just five days before
Election Day, a television station in Maine broke a story about then
governor Bush having been arrested in 1976 for drunk driving. There were a
total of 621 media reports done on this story through Election Day. CNN did
61. CBS did 19. ABC did 26. NBC did 33. All in five days.
Adding it up, the media paid more attention during a five-day period to a
24-year-old drunk driving arrest than they've given in the past five and a
half years to the largest campaign finance fraud in American history. Not
only have there been a scant 458 media reports on the Clinton campaign's
fraudulent activities since revelations concerning the matter first
appeared, but also virtually no media outlets covered this story even as
information was emerging in the final months of the 2000 campaign.
Robbing Peter to Pay Hillary
The Media Cover-Up of the Largest Campaign Finance Fraud in US History
The Fraudulent Senator: Part 5 of a 7 Part Series
Media/Noel Sheppard
March 17, 2006
To many Americans, Tom DeLay and Jack Abramoff are the faces of corruption
in politics today. Sadly, if the media had done its job the past five and
half years, the picture of campaign finance fraud would be a poorly dressed
blond woman from Arkansas that used to be the First Lady, but never became
the junior senator from New York.
Few truly objective observers of politics on either side of the aisle would
disagree with the premise that the Clintons have consistently drawn an
excessive amount of media attention since their meteoric rise onto the
national scene in the early '90s. One could likely find a consensus even
among Democrats when there wasn't a microphone or camera around that the
bulk of such coverage has almost always been quite favorable even when the
facts didn't warrant it.
On the flipside of this media fascination is a hypocritical compulsion by
the press to shelter the Clintons from negative scrutiny whenever possible.
Examples of this are so numerous and apparent they need no reiteration.
However, one event involving likely the largest case of campaign finance
fraud in American history has been so obfuscated by the media that many of
the players involved will be unfamiliar to even the most savvy political
observers.
As a result, one of the largest scandals involving the Clintons has gone
almost thoroughly ignored by America's press. When the first reports were
published, they were so minute in scope and visibility that the voters of
New York State had no idea who they were putting into office, and might have
voted differently if they had been properly informed.
Since then, most media outlets that have deemed this story worthy of print
and/or airtime have either through incompetence or deceit glossed over or
misrepresented much of the facts in an effort to protect politicians they so
transparently revere.
In the end, what makes this so reprehensible is that the Hillary Clinton
campaign finance activities the media have been covering up dwarf those of
former House majority leader Tom DeLay (R-Texas), and any of the members of
Congress who took funds from former lobbyist Jack Abramoff. Yet, both of
these issues have spent months as the lead stories of America's print and
television news media, while the Clinton chicanery has not. As a result, the
behavior of the media is just as corrupt as those they were trying to
protect.
What follows is an examination of how the media covered up the largest
campaign finance fraud in American history, and in so doing, helped elect a
former First Lady to the Senate, paving the way for her possible
presidential candidacy.
The Hollywood Farewell Gala For President William Jefferson Clinton
Our story begins on August 12, 2000, when a man whose name is unfamiliar to
probably 99 percent of the American people threw a fabulously luxurious and
massively expensive party for the Clintons in Brentwood, California, a posh
area just outside of Hollywood.
In attendance, as well as performing for the Clintons' entertainment, were
such Hollywood luminaries as Cher, Shirley MacLaine, Whoopi Goldberg, Patti
LaBelle, Jimmy Smits, Sugar Ray, Red Buttons, Toni Braxton, Angelica
Houston, Melissa Etheridge, Dylan McDermott, Alfre Woodard, and Michael
Bolton. Also on hand were John Travolta, Patrick Swayze, newlyweds Brad Pitt
and Jennifer Aniston, Milton Berle, Olivia Newton-John, Carol Burnett, David
Spade, Laura Dern, Michael York, Frances Fisher, Angie Dickinson, Rod
Steiger, Kathy Bates, Camryn Manheim, Ed Asner, Robert Wuhl, Richard Lewis,
and Annabelle Weston.
The event cost $1,000 per ticket, and $25,000 per couple for the dinner. All
of the funds raised were going to Hillary's New York senatorial campaign,
although the gala was dubbed as a going away party for the president
inasmuch as he was in the final months of his second term.
After the festivities, People magazine reported: "In politics, there are
Parties--and there are parties. The place to be--by a landslide--on Aug. 12
was the Robert Taylor Ranch in Los Angeles, where more than 1,000 Friends of
Bill, from Gregory Peck to Brad Pitt, kicked off a Democratic National
Convention week of high-profile bashes (including one on the set of NBC's
The West Wing) with a salute to President Clinton." On the same day, US
magazine did a spread of the gala as well.
This event was so huge that The New York Times included details about it in
a front page pre-Democratic presidential convention story two days before it
occurred: "The headline event is Saturday night at a private Los Angeles
estate. More than 1,400 people will attend a salute to the president, with
the proceeds going to Mrs. Clinton's Senate campaign." As amazing as it
might seem, this was the last time the Old Gray Lady would refer to this
gala, or any of the fraudulent campaign finance activities surrounding it
until February 2005.
Who was the man responsible for this gala? Peter F. Paul, a former
international lawyer, entrepreneur, and entertainment mogul with ties to
presidential administrations dating back to Richard Nixon. Of course, it's
no surprise that you haven't heard of Paul, for a LexisNexis search of all
reports containing the names "Peter Paul" or "Stan Lee Media" (Paul's former
company) or "David Rosen" (Clinton's former campaign finance director) and
"Hillary Clinton" since this gala occurred identified only 458 reports by
all media outlets. 368 of these stories were published after Rosen was
indicted for his involvement in this scandal on January 7, 2005.
By contrast, the name Jack Abramoff received more than 1,000 results for
just 2006 alone. And, in just the 24 hours following the announcement of Tom
DeLay's indictment in September 2005 there were 859 media reports on the
subject. Compare that to only 26 media reports in the 24 hours following
Rosen's indictment roughly eight months earlier, and one can see an almost
unbelievable and thoroughly inexplicable disparity in the press' coverage of
these events.
Why the blackout concerning this issue? Well, on top of the indictment of
Hillary's campaign finance director, the Clintons are also being sued by
Paul in California Superior Court for "fraud, deceit, negligent
misrepresentation, unfair business practices, unjust enrichment, and civil
conspiracy," and it appears that America's press are not interested in
reporting the existence of these cases or the facts surrounding them.
(The reader should be aware that using LexisNexis to "count" media reports
is not a completely accurate measurement, as some articles and/or newscasts
can be duplicated using this website for such a purpose. Also, wire services
like the Associated Press may publish multiple versions of the same story
throughout a given day, and each of these counts as a report in such a
search. However, for purposes of comparison, such an analysis has tremendous
value despite not being 100 percent precise.)
The Largest Campaign Finance Fraud in American History
As the root issue for this lawsuit is noncompliance with federal election
laws and what constituted campaign finance fraud, it is important for the
reader to understand at the onset some of the economics behind this gala
fundraiser, and how they ended up being falsely reported to the Federal
Election Committee.
The contributions received that fateful August evening in 2000 according to
Paul's lawsuit totaled $1.5 million. Paul's costs associated with the
fundraiser, which by FEC law constituted contributions as well, were $1.9
million -- "not including the fair market value of his own services in
acting as executive producer of the event and the fair market value,
estimated at an additional $1 million, of the services rendered by eight (8)
world class artists who performed at the concert portion of the event."
Without getting confusingly complex, FEC laws distinguish between "hard
dollars" and "soft dollars" raised by a candidate for campaign purposes.
Hard dollars carry a $2,000 per contributor limit; soft dollar contributions
from an individual have a $25,000 limit, and; corporate contributions have
no dollar limit, but are restricted to national committees and PACs while
being restricted from specific candidates. In addition, soft dollars are
supposed to be used by the national party of a candidate to exclusively
promote issues of the party. By contrast, hard dollars can be used for the
sole benefit of the candidate to promote his/her election goals, including
running media ads, sending mailers, organizing phone banks, etc. As a
result, hard dollars are extremely precious.
Of course, candidates and their parties for years have figured out ways to
rig the system thereby using soft dollars for purposes that operate in the
gray areas of the regulations. The reader might recall a well-publicized
incident that occurred during a September 2000 New York senatorial debate
between Hillary Clinton and her Republican opponent, Rick Lazio (R-New York)
dealing with this very issue. To make a point, Lazio approached Clinton
demanding that she sign a document agreeing to not use soft dollars for her
campaign. Hillary didn't sign this at the time, but finally acceded on
September 24.
With that in mind, as former Clinton advisor Dick Morris wrote in an April
2005 article entitled "How Hill Gained," "Under the arcane rules of the
Federal Election Commission at the time, campaigns could use soft money to
pay for fund-raising events - provided the gathering's costs came to 40
percent or less of the total of hard money raised." In the case of this
gala, as it raised a total of $1 million hard dollars according to Morris,
the Clinton campaign would have only been able to use $400,000 of soft
dollars to cover the cost of the fundraiser. Using Paul's expense figure of
$1.9 million, this would have cost the Clinton campaign $1.5 million in hard
dollars.
Now, it appears that there is some confusion as to what the real cost of
this gala fundraiser was. Morris used the figure presented in an FBI
affidavit of "at least $1.2 million," and estimated that this would have
cost the Clinton campaign about $800,000 in hard dollars. Regardless of
which number is correct, given Hillary's agreement to not use soft money in
the campaign, as Morris put it, "she was hard up for hard money. So if
[national finance director for the Clinton campaign David Rosen] had owned
up to the full cost of the fundraiser, the campaign would have had to cough
up $800,000 of hard money at exactly the time that it needed the funds the
most."
To prevent this from occurring, the Clinton campaign decided to drastically
understate the cost of this event by declaring to the FEC on October 15,
2000 that it had received $366,564.69 from Stan Lee Media, Inc., the company
that Paul was a partial owner of at the time. Not only did this figure
conveniently fall below the 40 percent soft dollar limit, but also the use
of "Stan Lee Media, Inc." as contributor allowed the Clinton campaign to
deny and obfuscate its direct connection to Paul.
Of course, another issue to keep in mind is that according to an FEC
complaint filed by Paul on July 16, 2001, "Federal Election Commission
records for year 2000 reported political contributions by Peter F. Paul
reflect a total contribution of $2000.00, which was returned." Paul's
lawsuit contends that since the Clinton campaign in essence reported zero
dollars received from Paul in the year 2000, it should be required to
reimburse to him the $1.9 million he spent on this gala fundraiser. Also,
because his contribution exceeded the $25,000 soft money limit to
individuals, the excess over that amount should be immediately refunded.
The Party's Over
Likely before all the hangovers caused by this gala were recovered from, The
Washington Post dropped a bombshell that none of the participants expected.
On August 15, 2000, Post writer Lloyd Grove wrote the following in his "This
Just In" column:
"Is Hillary Clinton soft on crime? We certainly hope not, even though
convicted felon Peter Paul--who served three years in prison two decades ago
after pleading guilty to cocaine possession and trying to swindle $8.7
million out of the Cuban government-- helped organize Saturday's
star-glutted $1 million fundraising gala for Clinton's Senate race at
businessman Ken Roberts's Brentwood estate. Paul, co-founder of Stan Lee
Media, told us in a statement: 'As a young international lawyer and active
anti-communist, working in a politically charged environment, I got caught
up in a vicious interagency rivalry concerning a covert operation against
Castro's Cuba.' He added that he only produced the gala and hasn't given or
raised money for the first lady's New York campaign. And we will not be
accepting any contributions from him,' Clinton campaign spokesman Howard
Wolfson vowed."
This statement by Wolfson was quite curious, as it implied that the Clinton
campaign was surprised to find out about Paul's past. After all, Hillary
was, at that time, married to the president of the United States. Wouldn't
the background of anyone throwing a high-profile party for the president,
and being allowed to get so close to him and his family be properly vetted
by his staff? They didn't check Paul's Social Security number which would
have immediately identified his prior convictions? In addition, Paul had
previously hosted two fundraising events for Hillary, and one for Vice
President Al Gore. How could Paul's past not have properly vetted for these?
This is especially curious given the article that TIME magazine did on
February 12, 1979 entitled "The Cuban Coffee Caper," chronicling events that
Paul was involved in. Yet, the Clinton administration first found out about
Paul's participation in this "caper" when The Washington Post reported it
three days after the gala? This appears implausible, and is called into
serious question as the article ensues.
Grove followed up his August 15 column two days later largely it seems to
give the Clinton campaign the ability to correct some "fallacies" while
driving home the point that Paul was a "convicted felon":
"Senate candidate Hillary Rodham Clinton's press secretary misspoke--and
convicted felon Peter Paul apparently misremembered--when they told us this
week that Paul produced Saturday's star-glutted million-dollar fundraiser
but didn't personally give money to Clinton's campaign.
"'I stand corrected,' Clinton spokesman Howard Wolfson said Wednesday after
we located Federal Election Commission records showing that the
fifty-something Paul donated $ 2,000 to Clinton's Senate campaign on June
30. 'He had previously given, but not associated with this event, and today
we returned the check,' Wolfson said."
Grove's article, after relieving Clinton from guilt, then spent the bulk of
the allotted space on Paul, including what he paid to Hillary's campaign:
"A sometime show-business talent manager who co-founded Los Angeles-based
Stan Lee Media, Paul describes himself as 'an Internet guru.' Paul said
producer Aaron Tonken, who helped organize the fundraiser at businessman Ken
Roberts's Brentwood estate, must have sent candidate Clinton the money on
Paul's behalf. 'Aaron had me write checks for a lot of things, and I didn't
pay attention,' Paul said. Tonken didn't return our phone calls seeking
comment.
"Paul was paid 'a nominal fee' for his producing services, he said, and
Wolfson said Stan Lee donated $ 100,000 to cover some expenses for the
event. As for the rest of the estimated $ 1 million-plus cost, 'it was an
in-kind contribution . . . and not a check,' Wolfson said."
According to Paul, the statements he made to Grove in both of these pieces
were orchestrated by the Clinton campaign. "I was told by DNC Chair Ed
Rendell, after the Clinton camp heard from Grove and formulated their story,
before I spoke to Lloyd Grove, that I should not admit to paying for the
gala and go along with the Clinton story that they weren't taking any money
from me." In his view, the only way to protect the money he had contributed
was to accede to their "request." "I effectively was coerced to go along
with their story in order to protect the almost $2 million investment I had
just made in the business relationship," he said.
Also according to Paul, Grove had admitted to him that his source for Paul's
troubles with the law was Paul's former partner and romance icon, male model
Fabio and his new manager. The pair had a falling out in 1995 when Paul sold
Fabio his management agreement. In 1997, Paul and Fabio got into a shouting
match on Howard Stern's radio show, and there's been a lot of bad blood
between them since.
Paul received a tip from a friend at the Hollywood Reporter that after Fabio
heard about the gala Paul was throwing for the Clintons, he figured this
would be a great time for a little vindication. So, he contacted Grove to
stir up some muck.
That said, the most important element of Grove's second article was that
final paraphrased statement by Wolfson concerning the $1 million-plus cost
of the gala, and that this was an "in-kind contribution"; this is
significantly greater than the approximately $367,000 the Clinton campaign
declared roughly two months later to the FEC.
As a clarification, the term "in-kind" means that the contribution did not
come in the form of cash, check, or a credit card transaction. Instead, the
FEC requires candidates to submit detailed accountings of goods and services
provided to them by donors to assess their value, which is then reported as
an in-kind contribution.
This is a important issue for the reader to understand: On August 16, 2000,
Howard Wolfson, a key spokesman for Hillary Clinton who still works in this
capacity, told The Washington Post that the gala fundraiser in Hollywood
cost over $1 million, and was an in-kind contribution. Yet, two months
later, the campaign reported to the FEC that the gala cost $367,000, and was
contributed by Paul's company NOT by Paul. Yet, we now know from a January
30, 2006 amended filing by Hillary's campaign to the FEC that this number
was fraudulently underreported by $831,000, and that these funds all came
from Paul's personal holding companies and NOT Stan Lee Media.
That in a nutshell represents the fraud that the media have been assisting
Hillary and her minions to cover up for the last five and a half years.
This cover up began on August 15, 2000 when no other major media outlet
bothered to report what The Washington Post revealed in these two articles,
or further explore the allegations contained in these articles prior to
Election Day 2000 or since. (According to LexisNexis, the only other press
outlet to pick up this story before November 7, 2000, was Bulletin
Broadfaxing Network on August 16.) This is especially true for the New York
papers whose readers would be the most impacted by this information. In
particular, as The New York Times had previously reported the existence of
this gala, why did its editors think that it wasn't important to inform the
public that it was hosted by a felon, or that the numbers being reported by
the Clinton campaign to the FEC concerning its cost were suspect?
Regardless, according to Paul, after the Post articles were published, the
next media contact didn't come until well into 2001. As a result, almost
three months before Election Day 2000, the wife of the president of the
United States, who also happened to be running for a senate seat in one of
America's largest states, admitted to taking campaign money from a felon.
Almost two months later, her campaign officials fraudulently underreported
and misattributed the origin to the FEC contributions it had received -
information that was available to the public and to the press at the FEC
website on October 15, 2000. And, this number was one third as much as
Hillary's spokesman had told The Washington Post.
Yet, for some reason, the Post chose not to follow up on its own story. Why
was that? After its first piece on August 15, 2000, somebody at the Post
"located Federal Election Commission records showing that the
fifty-something Paul donated $ 2,000 to Clinton's Senate campaign on June
30." In doing so, the Post caught the Clinton campaign and its spokesman in
a lie. As such, why didn't the Post continue to follow up on this story by
regularly checking FEC records to verify how the contributions from this
million-dollar gala were reported? Wouldn't that have been sound
investigative journalism, or is that asking too much?
Similarly, as the Post had caught the Clinton campaign in a lie concerning
its fundraising activities surrounding a convicted felon, how could the rest
of the media totally ignore this eleven weeks before Election Day? This
preposterous lack of media curiosity included "The Most Trusted Name in
News," or what people used to refer to as the "Clinton News Network," for
according to LexisNexis, CNN's first report on this subject didn't occur
until 2005 when Hillary's campaign finance director David Rosen was
indicted. Imagine that!
What's Good for the Clintons Isn't Good for the Bushes
To put this in proper perspective, try to imagine what would have occurred
if similar allegations with an admission, along with a fundraising
misstatement by a key spokesperson, had been published at the same time
about Hillary's opponent, Rick Lazio, or any other Republican candidate
including George W. Bush. Would the media have ignored those revelations?
Hardly.
As a perfect example of how absurd this Clinton fundraising media blackout
was, consider that on September 8, 2004, roughly two months before Election
Day, CBS's Dan Rather reported about documents relating to President Bush's
air national guard service. In the next 24 hours, there were 559 reports on
this subject by media outlets prior to the revelation that the documents had
been forged. And, this was regarding events that had transpired almost four
decades prior.
Or, consider that on Thursday, November 2, 2000, just five days before
Election Day, a television station in Maine broke a story about then
governor Bush having been arrested in 1976 for drunk driving. There were a
total of 621 media reports done on this story through Election Day. CNN did
61. CBS did 19. ABC did 26. NBC did 33. All in five days.
Adding it up, the media paid more attention during a five-day period to a
24-year-old drunk driving arrest than they've given in the past five and a
half years to the largest campaign finance fraud in American history. Not
only have there been a scant 458 media reports on the Clinton campaign's
fraudulent activities since revelations concerning the matter first
appeared, but also virtually no media outlets covered this story even as
information was emerging in the final months of the 2000 campaign.