Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: MONDAY, February 14, 1994 TAG: 9402140024
SECTION: NATIONAL/INTERNATIONAL PAGE: B7 EDITION: METRO
SOURCE: Associated Press
DATELINE: LITTLE ROCK, ARK. LENGTH: Medium
The Clintons ended their 14-year relationship with Whitewater Development Corp. in December 1992, selling their half to James McDougal.
In May 1992, Whitewater had paid off its remaining loans, enabling it to begin making a little money. Since then, those proceeds - which total less than $200 a month - have gone to McDougal.
The Clintons have said they invested and lost nearly $69,000 during their years as co-owners.
They formed the venture in 1978 with McDougal and his then-wife, Susan, to build a vacation and retirement community along the White River in northern Arkansas.
The venture is a focus of a federal investigation into a failed Arkansas savings and loan owned by McDougal and other business dealings with ties to the Clintons.
During most of the Clintons' involvement in Whitewater, revenues from the venture went to pay off principal and interest on the original $203,000 mortgage the two couples used to buy the property.
But after that loan was paid off in 1992, McDougal said, the Clintons could have begun sharing in the small proceeds. Instead, they agreed to let McDougal - who had been felled by a stroke and depression and saw his financial empire collapse - keep the money they could have taken to cut their losses.
"For a few months, I suppose, they could have been [receiving income] if we'd had an agreement on what they had coming," McDougal said. "They were in agreement with what was done, that it would be distributed the way it has been."
The arrangement was confirmed by James Blair, a Clinton friend and attorney for Arkansas-based Tyson Foods Inc. who advised the Clintons on the matter.
Blair said he looked into Whitewater after the Clintons expressed concern about what was happening to the company's proceeds.
Blair said they decided not to pursue their share of the income after he urged them to have "a bit of charity and forgiveness."
"My statement was, `The guy is sick, he is down and out, why hassle him about a small amount of money?"' he said.
The attorney said he thought the Clintons probably should have received other Whitewater income over the years.
"It has never been clear as to what he [McDougal] has taken out of Whitewater," Blair said. "But I believe it to be more than anybody has talked about."
McDougal acknowledged he sometimes took revenues from Whitewater for himself as repayment of temporary loans he had advanced to the company.
He says he shares the money with his ex-wife, who lives in Los Angeles and retains 25 percent ownership. He owns the other 75 percent.
by CNB