The Arkansas Project was a $2.4 million effort to investigate and discredit President Clinton, mounted by The American Spectator magazine between 1993 and 1997, and funded by conservative billionaire Richard Mellon Scaife.
Attorneys who are familiar with still-secret portions of the so-called "Shaheen report" -- which detailed the relationship between the Arkansas Project and Hale -- said it contained an account as to how one of the founders of the Arkansas Project, David Henderson, was involved in assisting Hale by successfully recruiting Olson to serve as Hale's legal counsel. That investigation was conducted by a special counsel, Michael E. Shaheen -- a former senior Justice Department official -- who was appointed with the mandate to determine whether individuals associated with the Arkansas Project provided Hale with favors, gratuities, and legal representation in an effort to corruptly influence Hale's testimony regarding former President Clinton.
Additional details regarding Olson's representation of Hale, not included in the Shaheen report, have emerged over the course of the last several days in interviews with this reporter by several other individuals with personal knowledge of the matter.
Late last evening, the Senate Judiciary Committee made public a relatively small number of pages from the Shaheen report. And even those relatively sparse excerpts contained significant redactions and deletions of information relevant to Olson's confirmation, according to attorneys who have read fuller versions. Most of the details regarding Henderson's role in recruiting Olson as Hale's attorney were not contained in the portions made public yesterday.
A spokesman for Independent Counsel Robert W. Ray said that their office was unable to make the full report available, because it contains grand jury information, which they are prohibited by law from making public.
The new revelations about how Olson came to represent Hale come not very long after the ranking Democrat on the Senate Judiciary Committee, Patrick Leahy of Vermont, as well as the other eight Democrats on the committee, voted against Olson's confirmation last week as they charged that Olson has been evasive and nonresponsive about his knowledge of the Arkansas Project and his role as Hale's attorney.
In leading the opposition to Olson's nomination, Leahy said that he was "concerned that Mr. Olson has not shown a willingness or ability to be sufficiently candid and forthcoming with the Senate."
Among the several concerns that Leahy said that he had regarding Olson was Olson's claim that he could recall little if anything at all about how he came to represent Hale: "Is this selective memory, or is this something that he didn't want us to know about?" Leahy asked.
On May 9, Olson wrote to Leahy that he could not recall who had first contacted him "about the possibility of representing Mr. Hale;" that the little that he could remember was that he had been "contacted by a person or persons whose identities I cannot presently recall;" and that his recollection of the matter had grown "quite faint" over the years. The events in question, Olson further asserted, had never had any "special significance to me" in the first place.
But several individuals told investigators during the Shaheen investigation that David Henderson, who oversaw the Arkansas Project, had first approached, and then recruited Olson to represent Hale, according to attorneys familiar with the probe.
Moreover, some investigators have been privately skeptical of Olson's claims that he could not recall much about how he came to represent Hale, while so many other individuals involved provided detailed information and recollections during the federal probe about how the legal representation came to be.
Various portions of the Shaheen report that were made public yesterday appear to advance Olson's chances of confirmation, while others appear to raise new questions about his involvement with Hale and the Arkansas Project.
On the one hand, the report concluded there was no evidence of wrongdoing by Olson: "Theodore Olson, in representing Hale . . . asserted legal arguments and objections on behalf of his client . . . The unquestionable assertions of a client's legal rights, even by an attorney who provided [what] amounted to 'free' legal services because he viewed the client as a thorn in the side of a political foe, is not a likely successful theory for prosecuting either lawyer or client for witness bribery, obstructing justice or witness tampering."
But another portion of the report made public yesterday also disclosed for the first time that Olson provided "approximately $140,000 in legal representation [to Hale] for which Hale has not paid and which has been written off by Olson's law firm as uncollectible." The report further concluded: "There is certainly reason to believe that Olson took on Hale as a 'paying' client with no real expectation that he (or his firm) would ever be paid."
A senior Democratic staffer on the Senate Judiciary Committee said this week, "I think that a reasonable person could easily come to the conclusion that an attorney of Ted Olson's caliber was not going to provide someone like David Hale with $140,000 worth of legal services . . . without an expectation of ever being paid, unless he was pursuing some personal, partisan or political agenda."
In its vote on Olson's nomination for Solicitor General last week, the Senate Judiciary Committee, deadlocked 9-9, along straight partisan lines, over whether to confirm Olson. Under ordinary circumstances, when there is such a split vote, the nomination is not then sent to the full Senate for a floor vote, thus usually dooming the nomination. But because the Senate is currently evenly divided 50-50 between Democrats and Republicans, Senate Majority Leader Trent Lott (R-Miss) has the authority in the case of a tie to file a "discharge motion" to bring the nomination before the full Senate. The question is whether he can do so before Senator James Jeffords officially leaves the Republican Party (something he is expected to announce on Thursday), handing control to the Democrats.
On Sunday, Lott asserted that allegations that Olson had been "evasive" in his Senate testimony amounted to little more than "flyspecking" and "character assassination." Republican Senator Orrin Hatch, the chairman of the Senate Judiciary Committee and Olson's most ardent defender, has said that he believed Olson had "been truthful and forthright" during his confirmation, and has suggested that Democrats were opposing Olson's nomination as retribution for the fact that Olson successfully argued Bush's case before the Supreme Court during last year's election crisis.
In an attempt to avoid a divisive fight over Olson's nomination on the Senate floor, the Bush White House urged Senate Republicans to compromise with their Democratic counterparts by allowing for a limited Judiciary Committee staff investigation regarding unresolved issues concerning Olson's nomination. Congressional investigators now say the issue of whether Olson was evasive or non-responsive about how he came to represent Hale will almost certainly be at the forefront of any such inquiry.
Henderson -- also at the time the vice president of the American Spectator Educational Foundation, which oversaw the conservative magazine -- directed the day-to-day activities of the Arkansas Project with a second conservative activist and lobbyist, Stephen S. Boynton.
The federal criminal investigation lead by Shaheen began in July 1998, as the result of allegations first made by an Arkansas woman, Caryn Mann, and her son, Joshua Rand, that a representative of the Arkansas Project named Parker Dozhier, had made numerous cash payments and provided other gratuities to David Hale, during a time that Hale was a critical cooperating witness in Independent Counsel Kenneth Starr's Whitewater probe.
Mann and Rand said that Dozhier, a self-styled sportsman from Hot Springs, Arkansas, with whom they lived for several years, made modest payments of cash and provided Hale with the free use of a car and cabin. Dozhier admitted to having been paid $48,000 as an "investigator" and "operative" for the Arkansas Project. But both Dozhier and Hale have adamantly denied that any money exchanged hands between them.
Testimony by Hale, a disgraced former Arkansas municipal court judge, had been central to Starr's office winning fraud convictions in 1996 against then Arkansans governor Jim Guy Tucker, and James and Susan McDougal, the business partners of Bill and Hillary Clinton, in their failed Whitewater real estate venture.
Hale himself had earlier pled guilty to two felonies related to his admission that he had defrauded the Small Business Administration of more than $3.2 million through a federally subsidized company that he headed.
Hale had also alleged that Bill Clinton, while governor of Arkansas, had pressured him to make an illegal and fraudulent $300,000 loan to Susan McDougal from his federally subsidized lending company. Under oath, Clinton adamantly denied Hale's allegations.
Starr spent several years relentlessly attempting to prove that Hale's allegations were true and that Clinton had lied under oath, but to no avail. When Starr ultimately sent his impeachment referral to the U.S. House of Representatives in the summer of 1998, it related solely to Clinton's alleged wrongdoing in the Monica Lewinsky affair, and contained no allegations regarding Whitewater.
Starr appointed Shaheen in April, 1998 to conduct an entirely separate and independent criminal investigation into whether individuals working for the Arkansas Project had attempted to corruptly influence Hale's testimony regarding then President Clinton.
Shaheen's investigation concluded that there was insufficient evidence to prove beyond a reasonable doubt whether Dozhier gave small amounts of cash to Hale. Another conclusion of the investigation was that although individuals working for the Arkansas Project provided Hale with favors and gratuities and found him legal assistance, there was little evidence to show that they had done so with the intent to corruptly influence Hale's testimony regarding Clinton.
The Shaheen investigation also uncovered evidence that "persons associated with the Spectator" made $8,800 in payments to an Arkansas attorney, Jay Bequette, to defend Hale against criminal charges brought by Arkansas prosecutors alleging that Hale had misrepresented the solvency of an insurance firm he owned to state regulators. Hale made the misrepresentations, the prosecutors alleged, to conceal the fact that he looted the firm. Hale was convicted on those charges in March of 1999.
Shaheen's investigation also briefly examined the circumstances surrounding Olson's representation of Hale, in an attempt, as with the case of Bequette's representation of Hale, to determine whether Olson's serving as Hale's attorney amounted as an attempt by the Spectator or individuals associated with the Arkansas Project to provide Hale something of value to influence his conduct as a federal witness.
Olson's representation of Hale was of particular interest to investigators because of the fact that Olson and his law firm provided $140,000 of legal services to Hale without much hope of ever being paid for them. But Shaheen ultimately concluded that the free legal services also did not influence Hale's testimony as a federal witness in the Whitewater investigation.
During the course of that inquiry, however, several individuals told federal investigators that it was David Henderson, the vice president of the Spectator Foundation who also oversaw the day-to-day activities of the Arkansas Project, who first recruited Olson to represent Hale.
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Henderson himself told investigators that he first suggested to Olson that he should represent Hale in the December, 1993, according to these sources. Henderson also asserted that he first raised the issue with Hale around the same time period. And Henderson also said that he attended a meeting with Olson and several other individuals in Olson's Washington D.C. law office around the same time to discuss the potential representation at some length.
Another individual with first-hand information about how Olson came to represent Hale through Henderson is Caryn Mann, whose allegations regarding the Arkansas Project initiated the Shaheen investigation in the first place. In a 1998 interview of Mann this reporter conducted for Salon magazine -- some three years before the current controversy -- Mann also asserted that Henderson had introduced Hale to Olson.
Mann asserted during that 1998 interview: "Dave Henderson came up with Ted Olson. At first P.D. [Parker Dozhier] said that he had never heard of him. He said, 'I don't like it. I don't know who this guy is.'" Henderson, in stark contrast, recalled Mann, was "very excited and positive about Olson . . . He was effusive. He told them that they could not do any better than Ted Olson."
After prodding by Henderson, Mann said, Hale and Dozhier then drove to Washington D.C. to meet Olson for themselves.
Mann also asserted that Dozhier told her that The American Spectator had agreed to reimburse him and Hale for any expenses incurred by making the trips. Financial records of the Arkansas Project show that Dozhier was routinely reimbursed for travel expenses during that period, but the records are not specific enough to show whether he was reimbursed for that particular trip.
After Hale personally met with Olson, according to Mann, both Hale and Dozhier came away impressed: "When they came back, they weren't concerned about anything anymore. It was all taken care of."
Unlike other witnesses interviewed during the Shaheen investigation, Mann said this week, an FBI agent and prosecutor who questioned her and her son never asked her anything about Olson. "Their inquiry appeared to be narrowly focused," Mann said, "Had they asked me, I would [have] told them exactly what I told you in 1998: that Henderson set Hale up with Olson. But that did not seem to be their focus."
Regarding Olson, Dozhier provided investigators with an account regarding Hale, Henderson, and Olson that was remarkably similar to Mann's, according to lawyers familiar with Dozhier's statements. Dozhier confirmed to investigators that it was Henderson who first made the recommendation to him and Hale that Olson represent Hale, and introduced Olson to Hale. And Dozhier also admitted that he drove Hale to Washington D.C. to meet Olson.
A fourth individual, who worked for the Spectator during the same time, and who was also interviewed by Shaheen's staff, says that he too was directly told by others involved in the Arkansas Project that it was Henderson who arranged for Olson to represent Hale. This person, who spoke on condition of anonymity, said however: "If anyone working for the United States Senate or the Senate Judiciary Committee has questions for me, I will answer them truthfully, and in full."
A fifth individual who might have relevant information for the Senate Judiciary Committee regarding Olson's representation of Hale is Michael J. Horowitz, a former Reagan administration official who is now a Senior Fellow with the conservative Hudson Institute. Ironically, Horowitz raised the issue himself in an effort to clear Olson of other allegations that Olson had misled the Senate committee about Olson's knowledge of the Arkansas Project.
In a statement that Horowitz sent the committee on May 14, Horowitz said that Olson was a friend of 20 years, and that he has the "highest regard . . . for his professionalism, intelligence and integrity." Horowitz sent his statement to the committee because a central issue for Senator Leahy in considering Olson's nomination has been whether Olson was being entirely truthful before the committee when he asserted that he had not known of the existence of the Arkansas Project until the spring of 1997. Leahy has said that he was skeptical of Olson's claims because of Olson's multiple roles during that time as a member of the board of directors of The American Spectator, counsel for the magazine, and counsel for Hale. The activities of the Arkansas Project began in earnest the fall of 1993.
Moreover, an article published in Salon magazine in 1998 asserted that one of the first meetings regarding the formation of the Arkansas Project took place in December of 1993 in Olson's law office. According to the article, the other participants at the meeting were David Henderson; Stephen Boynton, the conservative activist who oversaw the Arkansas Project with Henderson; Ronald Burr, then the publisher of The American Spectator; John A. Mintz, a former general counsel of the FBI and law partner of Olson's; and Michael Horowitz. After publication of the article, Shaheen's staff interviewed every single person who attended the meeting.
In response to recent questions by Leahy regarding the alleged meeting, Olson told the Judiciary Committee: "I do not recall the meeting described. I certainly was not involved in any such meeting at which a topic was using Scaife funds and The American Spectator to 'mount a series of probes into the Clintons and their alleged crimes in Arkansas.' And I have no notes, time records and other documents relative to any such meeting."
Apparently referring to the very same meeting, Horowitz told the Judiciary Committee in his statement that he very likely had attended the meeting in question, but it did not relate to the Arkansas Project. Instead, according to Horowitz, the meeting was held to discuss Olson's legal representation for David Hale.
In his statement, Horowitz said: "I attended one meeting in Mr. Olson's presence at which the matter discussed was legal representation for David Hale, who was facing congressional testimony and was in need of distinguished Washington counsel. At that meeting -- at which no mention I know of was made of the 'Arkansas Project' or any term like it -- the subject under discussion was whether Mr. Olson's firm would serve as counsel to Mr. Hale." Horowitz provided virtually the same exact account to federal investigators who questioned him regarding the matter, according to sources familiar with his statements.
Regarding the same meeting, Olson similarly told investigators for Shaheen's office that "the participants may have discussed Hale needing a 'Washington lawyer' to represent him if he were called to testify before any Congressional committees."
Olson's recollection of the meeting -- that its purpose was to consider finding counsel for Hale -- directly contradict his later statements to the Senate that he could not recall the December, 1993 meeting at all, and that he also could not recall who first approached him to represent Hale.
In an interview on Monday with this reporter, Horowitz said that he could not recall the date of the meeting, and exactly who all the other participants were. But he insisted he was quite sure the meeting did indeed take place, and that his primary reason for attending was to convince Olson to represent Hale. And Horowitz also said that he did specifically recall the attendance of John A. Mintz, the former FBI general counsel and law partner of Olson's, who others recalled as attending as well.
According to records of the now defunct Senate Whitewater committee, Olson and Mintz later jointly represented Hale when the committee considered calling Hale to testify. At the direction of Olson and Mintz, the records show, Hale declined to testify before the committee, absent a full grant of immunity from prosecution.
Mintz wrote the Senate committee in a June 6, 1996 letter: "I have advised the Committee -- that Mr. Hale will claim the protection of his Constitutional privilege under the Fifth Amendment . . . and respectfully decline to testify . . . if he is compelled to appear in response to the subpoenas."
Democratic Senator John Kerry of Massachusetts, a member of the Whitewater Committee and a former prosecutor, angrily declared at the time that his fellow senators should "not be bamboozled and bullied by a legal scheme into giving an immunity that we don't need to give." Kerry pointed out that if the committee accepted Mintz's proposal, once on the witness stand, Hale would be free to disclose his involvement in any number of serious crimes, and escape any prosecution for them, because of such an immunity deal.
Ultimately, the Senate Whitewater Committee declined to grant immunity to Hale as a condition for him to testify. The committee completed its investigation and issued a final report without ever hearing from its most important potential witness.
