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Clintons top all-star cast of fraud-case witnesses

Posted By Art Moore On 04/25/2006 @ 1:00 am In Front Page | Comments Disabled


Bill Clinton greets Peter Paul and his wife Andrea at Hollywood gala (Hillcap.org)

Bill and Hillary Clinton head an all-star cast of witnesses in a lawsuit by business mogul Peter Franklin Paul that alleges the former president reneged on a $17 million deal in which he promised to promote a business in exchange for massive contributions to his wife’s Senate campaign.

The potential witness list includes celebrities such as Muhammad Ali, Brad Pitt, Barbra Streisand, James Brolin, Cher, Whoopi Goldberg, George Hamilton, Olivia Newton John, John Travolta, Diana Ross, Shirley McLaine, Michael Bolton, Toni Braxton, Paul Anka and Larry King.

Also on the list are former Vice President Al Gore, the Clinton’s daughter Chelsea Clinton, former Attorney General John Ashcroft, Homeland Security chief Michael Chertoff, former California Gov. Gray Davis, former Democratic National Committee Chairman Terrence McAuliffe, CBS News reporter Mike Wallace and ABC News reporter Brian Ross.

Paul told WND these people, and many others, have direct knowledge of the alleged frauds. He says he explained, for example, in person to actors Pitt and Travolta that his personal contribution of some $2 million for a Hollywood gala and fund-raiser for Sen. Clinton’s Senate campaign in 2000 was done in exchange for Bill Clinton promoting Paul’s Internet business, Stan Lee Media, after leaving office.

Clinton was promised an additional $15 million in stock to join the board of the company, which Paul formed in partnership with famed Marvel Comics creator Stan Lee.

But Paul charges the former president caused the company’s stock to collapse by diverting $5 million promised by a Japanese investor in an attempt to get out of the deal.

Paul has compiled his charges, with documentation on a website.

As WorldNetDaily reported, Paul, claiming Sen. Clinton pulled off the biggest campaign-finance fraud in history, separately is preparing to file a complaint with the Federal Election Commission charging the Democratic senator with submitting a false report – for a fourth time – that hides his personal multi-million dollar contributions to the Hollywood gala and fund-raiser that helped put her in office.

On April 7, a judge in Los Angeles dismissed Sen. Clinton as a defendant in the civil lawsuit, but she will be deposed as a material witness in preparation for a trial set for March, 27, 2007.


Clinton attorney David Kendall (PBS.org)

Already, the Clintons’ longtime attorney David Kendall has moved to delay the testimony of the senator, who insists she had no knowledge of any business deal despite Paul’s claim it was discussed on numerous occasions.

Kendall told WorldNetDaily he would not comment on the case.

In a letter to Paul’s attorney, Gary Kreep of the public-interest law firm U.S. Justice Foundation, Kendall contended the delay is warranted because the court issued an order that any deposition cannot begin until 30 days after resolution of Sen. Clinton’s motion to be dismissed.

California Superior Court Judge Aurelio N. Munoz granted Sen. Clinton her motion to be dismissed from the case based on the state’s anti-SLAPP law, which protects politicians from frivolous lawsuits.

But Kendall, citing WND’s story, noted Paul might appeal the dismissal and argues the motion to dismiss, therefore, is not resolved. Munoz had ruled Paul could not depose Sen. Clinton for the Anti-SLAPP motion.

Paul’s team sees Kendall’s move as another stalling tactic by the Clintons, pointing out any evidence gathered from the deposition could not be used in an appeal anyway.

Paul argues the judge made it clear he won’t accept any attempts to block Sen. Clinton from serving as a material witness.

In court April 7, Kreep told Munoz: “I anticipate opposition to taking the deposition of Senator Clinton. I assume we’ll be back to court on motions of that.”

The judge replied: “Well, any opposition is probably going to be dead on arrival, if that will – if you understand what I’m saying, Mr. Kendall.”

Kendall: “I do, your honor.”

United States Justice Foundation attorney Colette Wilson told WND she believes the court’s stay on discovery was lifted with the April 7 decision, but she acknowledged Paul’s team may have to go back to Munoz for clarification.

‘No recollection’

In her declaration, Sen. Clinton admitted spending time with Paul on several occasions prior to the gala and during the event, but said if there was any discussion of her husband’s employment with Paul, she would have remembered it.


Sen. Hillary Clinton greets Peter Paul at Hollywood gala (Courtesy Hillcap.org)

Paul stated in his declaration to the court, “Mrs. Clinton personally assured me she would specifically discuss with her husband, the President, my interest in making a post-White House business proposal to him. She told me her understanding that such a proposal would include my offer of substantial support for her Senate campaign as a good-faith advance on the business arrangement he would be agreeing to.”

In her declaration, Sen. Clinton said she had “no recollection whatsoever of discussing any arrangement with [Paul] whereby he would support my campaign for the United States Senate in exchange for anything from me or then-President Clinton, and I do not believe that I made any such statements because I believe I would remember such a discussion if it had occurred. I also have no recollection whatsoever of talking with him about any future business arrangement of any kind between him and then-President Clinton, and I do not believe that I made any such statements because I believe I would remember such a discussion if it had occurred.”

Paul called Clinton’s declaration a “non-denial denial.”

“If they were false allegations, why not just say they are untrue?” he asked.

But Paul believes he’ll have better success getting a straight answer from Sen. Clinton during the case’s discovery process, noting that unlike a criminal case, a witness in a civil matter can be compelled to testify against herself.

“This is unique for Hillary,” Paul said. “She can’t hide behind the Fifth Amendment unless it would involve an admission to a crime.”

Financial collapse

As for Bill Clinton, Paul contends the former president will have difficulty denying his assistant, James Levin, interfered with a major investor in Stan Lee Media, leading to the company’s financial collapse.


Peter Paul and Bill Clinton (Hillcap.org)

Paul contends that after backing Hillary’s fund-raising effort, Bill Clinton used confidential information about Stan Lee Media to sack the company and consequently remove himself from the deal.

Paul says he had an agreement with a Japanese animation company led by Tendo Oto, who promised to invest $5 million in Stan Lee Media with the understanding Clinton would serve as a rainmaker.

But Clinton, through his agent Levin, conspired with Oto to form a company of their own with the $5 million that would have gone to Stan Lee Media, Paul asserts.

Paul emphasizes Clinton signed a confidentiality agreement with Levin to act as the former president’s agent and, therefore, is bound by all of Levin’s actions.

Oto sat behind the Clintons and Paul at the August Hollywood gala and in September, at Paul’s request, was invited to a state dinner at the White House.

After the dinner, Levin and a White House aide took Oto to the Oval Office where he was allowed to have his picture taken sitting behind the president’s desk.

One week later, Levin, with the photos in hand, flew to Japan to meet Oto, without Paul’s knowledge.

Levin persuaded Oto to cancel his arrangement with Paul and enter into a deal with himself and Clinton and form a U.S. subsidiary Venture Soft USA, which Levin incorporated in Illinois in November 2000.

Paul argues Clinton certainly didn’t think Levin was qualified to run the firm: “A guy who’s only business experience was running a strip club all of a sudden incorporates a Japanese animation company.”

And Oto, Paul maintains, would not have made the deal if he hadn’t known Clinton was behind it.

Meanwhile, according to Paul, the loss of the promised $5 million from Oto caused Stan Lee Media’s stock to collapse.

“When the money didn’t show up because of the dot-com meltdown, we were unable to access capital markets for money we had expected from Oto,” Paul explained.

Paul insists he would not be in the legal predicament he faces if not for Clinton reneging on the deal.

He has pleaded guilty to a 10(b)5 violation of the Securities and Exchange Commission for not publicly disclosing control of Merrill Lynch margin accounts that held Stan Lee Media stocks.

He awaits a court decision that should come within two or three months. He could be sentence for up to 110 months in prison but already has served 43 months in prison in Brazil and an additional 15 months of house arrest in the U.S.

“All of this is based on damages, and the government hasn’t shown what those damages are,” Paul argued. “And if the damages are minimal, the punishment should reflect that.”

Paul said he lost $30 million in equity when the stock collapsed.

“I was the biggest loser,” he insisted.

Paul asserted everything he did was under the aegis of Merrill Lynch management and compliance officers.

The federal judge who dismissed Stan Lee Media’s suit against Merrill Lynch, ruled Paul’s margin accounts at Merrill Lynch initially helped the Stan Lee Media by giving it needed cash, and the scheme’s collapse was a result of the stock’s decline in value not the cause of it.

Separation

Sen. Clinton suddenly made a public break with Paul just days after the August 2000 Hollywood gala when the Washington Post splashed reports of Paul’s 1970s criminal convictions in a story that accused the senator of being soft on crime. The senator publicly distanced herself a few days after the gala, but Paul says she remained in close contact to convince him that no matter what she said publicly, their understanding was still in place and he should continue to give money to her campaign secretly.

Paul contends the Clintons were fully aware of his past legal problems, pointing out he was vetted more than eight times by the Secret Service.

Under the Carter administration, Paul was convicted for cocaine possession and an attempt to bilk Cuban dictator Fidel Castro of $8 million. He ascribes that to politics, arguing he was embraced by Ronald Reagan’s kitchen cabinet, which “realized the problems I had were more related to being gung ho about removing Castro.”

While still on parole, he said, he worked directly with Chief Justice Warren Burger and visited President Reagan in the White House.


Stan Lee, creator of “Spider-Man,” “Fantastic Four,” “Incredible Hulk” and other super heroes says he gave no money to Hillary Clinton (Forbes.com)

Meanwhile, Paul is preparing to file another complaint with the FEC, challenging a fourth amended report submitted by Sen. Clinton’s campaign treasurer Andrew Grossman. The report attributed contributions of $838,000 to Paul’s holding companies, Paraversal and Excelsior, rather than Paul personally, and $225,000 to his business partner Stan Lee, despite Lee’s denial under oath. Lee is the Marvel Comics artist who created “Spider-Man,” the “Incredible Hulk” and others.

The report to the FEC makes Stan Lee was her biggest contributor, but Lee, reached recently at his Los Angeles home by independent reporter Doug Cogan, expressed surprise when told of the declaration.

Lee told Cogan he made it absolutely clear to the FEC, the Justice Department and the FBI that he didn’t give a single penny to Sen. Clinton’s campaign.

Lee said he did make a loan to Paul and agreed to switch checks of $100,000, but certainly did not make a donation.

In his Feb. 23, 2005, deposition in Paul’s bankruptcy case against celebrity fund-raiser Aaron Tonken, Lee testified, “I never had a hundred thousand dollars to donate to anybody.”

Paul argues the federal government, in three different instances, has established the companies were alter egos for him personally, meaning he personally gave the money to Clinton’s campaign.

The FEC on Dec. 29, Paul points out, obtained an admission from an umbrella group for Clinton’s campaign through which large donations were channeled – New York Senate 2000 – that it had engaged in a five-year deception, violating the federal election law by hiding the largest donation made to her campaign.

As a consequence, New York Senate 2000 and Grossman agreed in the conciliation deal to pay a civil fine of $35,000 and amend false reports to reflect failure to report a $721,000 donation by Paul.

Paul says the Hollywood event cost close to $2 million. The government acknowledges it cost more than $1.2 million to host and raised $1 million in “hard money” contributions.

In addition, Paul claims, the fair-market value of the entertainment he provided amounted to another $1 million in contributions.

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