New Tape Raises Questions About What Senator Clinton Knew of Campaign Violation

By Fred Lucas | July 7, 2008 | 8:32 PM EDT

( - A Hollywood mogul and former associate of former President Bill Clinton and Sen. Hillary Clinton has obtained what he calls a "smoking gun tape" which he said proves that the New York senator and leading Democratic presidential candidate violated campaign finance laws.

Clinton friend-turned-nemesis Peter Paul plans to use the video both as evidence in a lawsuit against the former first couple and in a forthcoming documentary concerning his dealings with the Clintons during the former first lady's first Senate campaign in 2000.

The U.S. attorney's office for the Eastern District of New York gave copies of 90 tapes to Paul on April 11. The office had taken possession of the tapes six years ago during an investigation of a securities case against Paul in 2001.

One of those tapes appears to show comic book icon Stan Lee, Paul's business partner, talking to Hillary Clinton in a teleconference in 2000. Paul said the conversation was about a big fundraising gala Paul sponsored for the Clintons.

Paul put up $1.9 million for the function. At the time, the maximum individual contribution to a political candidate was $2,000.

A portion of the videotape seen by Cybercast News Service captures the closing words of a lengthy conversation in which Paul was present. The voice of Hillary Clinton is heard telling Lee that Paul and her chief campaign aide "talk all the time, so she'll be the person to convey whatever I need."

She is then heard adding, "I wanted to call and personally thank all of you ... [and] tell you how much this means to me. It's going to mean a lot to the president too."

Paul was the majority partner with Lee in a multi-million dollar Internet venture in 2000 before the company collapsed. Paul contends in a lawsuit that President Clinton had agreed to work as a rainmaker for the company after he left the White House in exchange for the massive star-studded fundraising event in Hollywood which Paul produced.

The newly released tape could be significant, because the Federal Elections Commission already ruled that Sen. Clinton's 2000 campaign committee underreported cash it received at the fundraising event Paul sponsored. The FEC slapped the campaign committee with a $35,000 fine.

The fallout from Paul's Hollywood fundraising event also led to the federal indictment of David Rosen, Sen. Clinton's campaign finance director, who was acquitted on charges of lying to the FEC.

Clinton and her supporters have maintained that she had no direct knowledge that the event violated campaign finance rules. In a written declaration for the California court filed on April 7, 2006, Sen. Clinton said only that she didn't remember discussions with Paul about the fundraiser.

"I have no recollection whatsoever of discussing any arrangement with him whereby he would support my campaign for the United States Senate in exchange for anything from me or then-President Clinton," Clinton said in the declaration.

"I do not believe I would make such a statement because I believe I would remember such a discussion if it had occurred," she added.

Neither Clinton's presidential campaign nor her Senate office responded to questions Friday about the forthcoming documentary and the recently released tape.

'Hillary exposed'

Paul's film - set to be released next month to interested cable stations and on DVD - includes other video footage of the Clintons meeting with Paul and Lee, a brunch attended by the Clintons, Barbara Streisand and Paul, as well as the massive concert/fundraiser for Hillary Clinton's first Senate campaign featuring Cher, Whoopi Goldberg, John Travolta, Brad Pitt, Sugar Ray, Queen Latifah and other celebrities.

The Clintons are seen sitting between the Paul family and the Lee family in what Paul claims was the largest private concert in history.

"I had no interest in the political side, it was purely a business decision so my partner, while he's still alive, could witness his company become a global media giant," Paul says in the film.

At one point in the documentary, Lee says to Hillary Clinton, "See why I picked him as a partner?"

Hillary Clinton responds, "Boy Stan, you were one smart guy before, now you're in the stratosphere." She offers thanks and praise to Paul at several points in the film.

In recent years, however, the Clintons have had few pleasant things to say about Paul.

Their attorneys in recent briefs point out that Paul pleaded guilty to manipulating the company's stock price. He has two previous felony convictions, pleading guilty to fraud in the 1970s and to a drug charge in the 1980s.

Paul said the documentary has a rough cut but will be completed in the next 30 days because of some reshooting. The working title is, "Hillary Exposed: The Case of Paul v. Clinton."

"No one has done a documentary on Hillary, ever," Paul told Cybercast News Service. "This has unique footage, home video footage, of meetings I had with the first lady."

The Washington-based conservative group Citizens United is producing its own documentary, "Hillary the Movie," set to be released in the fall in theaters and on DVD. The films will be very different, as the Citizens United movie is expected to be critical of New York senator's entire political life rather than focus on one case.

Trying to stay out of the lawsuit while she ran for reelection to the Senate and laid the groundwork for a presidential campaign, Sen. Clinton used a California statute intended to protect political candidates from frivolous lawsuits.

A California Superior Court judge last fall dismissed her from the lawsuit on those grounds, but Paul in January, contending that the California statute does not protect Sen. Clinton from alleged illegal activity.

His appeal asserts that "false promises of a post-White House business relationship ... paved the way for the Clintons to financially gut the financial insides of Paul's company."

Clinton's attorneys, including David Kendall, who was President Clinton's personal attorney during the 1998 impeachment, filed a brief in
response last month.

Oral arguments will likely be made to the three-judge panel this summer on whether to release Sen. Clinton from the lawsuit, with a decision expected soon after. But the entire case could go on for much longer.

While the new videotape is key to the case, it may prove difficult to enter into evidence because appeals courts frequently won't accept new evidence regardless of how relevant it might seem, Paul's attorney, D. Colette Wilson of the United States Justice Foundation, in Ramona, Calif., told Cybercast News Service Friday.

"As you watch the video tape, you're watching a felony take place," Wilson said.

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