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

Claiming Hillary Clinton pulled off the biggest campaign-finance fraud in history, business mogul Peter Franklin Paul 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 donation of a multi-million dollar Hollywood gala and fund-raiser that helped put her in office.

Calling the case “Hillary’s Chappaquiddick,” Paul is trying to air his charges – amid virtually no media coverage – by producing three different documentaries, including a theatrical release planned for the third quarter of 2007 that aims to have the kind of election-season buzz generated by Michael Moore’s “Fahrenheit 9/11.” A website, the “Hillary Clinton Accountability Project,” documents his accusations.

“I am exposing the frauds Hillary directed, and I witnessed, that won her seat in the Senate on her march to the White House,” Paul told WorldNetDaily. “It has become my penance to warn the American people of the real threat to our republic posed by this power-hungry sociopath.”

Paul insists Clinton’s new amended report finally acknowledged his contributions but falsely classified them as being from his companies and from his business partner, Marvel Comics creator Stan Lee, instead of from him as personal gifts. Clinton should have refunded the money according to federal law, he contends, because it was intended for her national senatorial campaign, and the limit for such donations is $25,000.

Clinton’s Senate office did not follow up WND’s request to respond to Paul’s claims.

President Bill Clinton celebrating business deal with Peter Paul and wife Andrea (Courtesy

Represented by the public-interest law firm U.S. Justice Foundation, Paul also alleges, in a civil suit, former President Bill Clinton reneged on a $17 million deal to promote Paul’s Internet businesses, causing one of his public companies to collapse by diverting his Japanese partner’s investments.

Paul claims he was asked to fund the Hollywood event in exchange for the former president agreeing to be his “rainmaker.”

Hollywood bash

The charges in the FEC filing and civil suit arise from a lavish Aug. 12, 2000, event at a private Brentwood estate that featured tributes to the Clintons from A-list actors such as Gregory Peck, Jack Lemmon, Michael Douglas, Goldie Hawn and John Travolta, topped off with performances by Cher, Stevie Wonder, Diana Ross, Paul Anka, Toni Braxton, Patti LaBelle, Melissa Etheridge, Sugar Ray and Michael Bolton.

Paul Anka performs at Hollywood tribute to President Clinton (Courtesy

But Sen. Clinton suddenly moved to distance herself from her major donor when just days after the “Hollywood Gala Salute to President Clinton,” the Washington Post splashed reports of Paul’s 1970s criminal convictions in a story that accused the senator of being soft on crime.

[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, he 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. In 2001 he pleaded guilty to one count of violating Securities and Exchange Commission regulations on the trading of his stock after being extradited from Brazil, where he spent more than two years in prison.]

Peter Paul and President Reagan (

Despite Paul’s chief role in funding and organizing the star-studded event and the hours she spent with him in conversation at two previous fund-raisers, at the gala and the next day at actress Barbra Streisand’s house, the New York senator publicly insisted she barely knew him, declaring, “We will not be accepting any contributions from [Peter Paul].”

But Paul contends the campaign’s latest amended FEC report proves her pre-election promise was a “cynical lie.”

“Hillary Clinton made a vow to the voters and to (senatorial opponent) Rick Lazio that she wouldn’t take money from me to avoid my being a political issue,” Paul said. “She continues to hide my role as her biggest contributor for political reasons. The federal election law says she can’t lie about my contributions for political reasons. She is continuing to violate the federal election laws.”

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 Clinton treasurer Andrew 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.

Peter Paul and Sen. Hillary Clinton (Courtesy

He argues that since Sen. Clinton reported the value of gala photographer Annie Liebovitz’s contributions to the event, it’s impossible for her to justify not reporting the value of the performances of Cher, Diana Ross and the others used to raise hard money for her campaign.

“That is a minimum of $1 million in fair market value for their collective performances at the concert that she witnessed and knows remains unreported,” Paul asserts.

But New York Senate 2000, in its first report, declared only $366,000 to the FEC.

Paul charges Sen. Clinton not only knew of the actions taken by her treasurer Grossman, she directed those actions and others in violation of federal campaign statutes and regulations.

Peter Paul and Hillary Clinton at a fund-raiser luncheon(Courtesy

Then, he contends, she helped cover it up through misleading the FBI investigation that led to the indictment of her former finance director, David Rosen, on criminal charges related to the reports.

Rosen, Paul emphasized, was indicted for actions for which Grossman now has admitted responsibility.

Paul argues that while Rosen was acquitted last year, the trial established, through government prosecutors and FBI witnesses, that Paul contributed more than $1.2 million of his personal funds to Sen. Clinton’s campaign in an attempt to persuade President Clinton to become a spokesman for his businesses after leaving office.

Paul asserts Grossman, de facto, committed perjury in his testimony at the Rosen trial by stating he did not know the event cost over a million dollars.

“He now admits he not only knew it cost over a million but he intentionally hid that fact from the FEC,” Paul said.

‘Reporting violation’

Ian Stirton, a spokesman for the FEC, told WorldNetDaily he could not comment on the allegations in Paul’s upcoming complaint, but he downplayed the actions for which Clinton’s group and treasurer were fined, calling it a “reporting violation” that did not result in any gain for the campaign.

Stirton said the law at the time required joint fund-raising groups such as New York Senate 2000 to report to the FEC both federal and non-federal receipts. (The FEC later abolished joint fund-raising committees).

Even though the non-federal funds did not concern the Federal Election Commission, the spokesman continued, they still had to be reported to the FEC.

That resulted in Grossman agreeing in the conciliation deal to pay a civil fine of $35,000 and to amend the false reports.

Paul’s donation was considered a non-federal contribution, Stirton explained, and Clinton’s treasurer, “for whatever reason,” did not report it.

Peter Paul gets a kiss of greeting from Hillary Clinton (Courtesy

But Paul contends the issue fundamentally is the public’s right to know who a major candidate’s contributors are and how much they gave.

“The reason Hillary did not report it is clear,” he said. “She vowed she wouldn’t take money from me; how can she report she took more than $1 million from me without admitting she lied to get elected?”

Paul points out FEC spokesman Bob Biersack testified at the Rosen trial that Congress’ fundamental purpose for FEC laws was to provide the public with complete and accurate information on how a campaign is run, who funds it and how much the donors give.

Sen. Clinton violated that purpose, Paul claims, by hiding his leading role in contributing to her election.

“If she is not held accountable she will continue to hide the truth from voters in her current campaign,” he asserted.

“I challenge anybody to read the general counsel’s report from the FEC and not decide that the Clinton campaign has been lying and falsely accusing me of lying since I filed my complaint,” he continued.

The fourth amended report, submitted by Grossman 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 Spiderman, the Incredible Hulk and others.

President Bill Clinton celebrating business deal with Peter Paul and wife Andrea (Courtesy

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.

“I signed the checks, yet Hillary’s campaign refuses to disclose that simple fact in its reports, undermining the right of the voters to know the truth,” he said.

Former Clinton aide Dick Morris, now a chief critic, believes that had Sen. Clinton reported accurately the cost of the event, she would have had almost $1 million less money to spend.

“This extra hard money was pivotal to her ability to finance her 2000 Senate campaign,” he said in an editorial.

“I’ve worked with Hillary: She’s a master of detail,” Morris argued. “A decision to underreport the costs of an event like the Hollywood extravaganza by almost three-quarters of a million dollars could not possibly have been made without her knowledge and approval – probably, at her direction.”

Confronted on camera

Sen. Clinton was confronted about Paul’s contributions on camera in 2001 by ABC News investigative reporter Brian Ross but refused to comment. Since then her only comments to the media about the case have come through lawyers.

After her finance director Rosen was indicted and tried, Clinton said through her lawyer David Kendall: “[Mrs. Clinton’s] Senate Campaign Committee has fully cooperated with the investigation. New York Senate 2000 properly reported all donations in 2000.”

The Pauls with the Clinton family at Hollywood gala (Courtesy

But Paul points out that after the FEC settlement with New York Senate 2000 forced it to admit omitting more than $721,000 from its reports, Kendall suddenly was replaced by attorney Mark Elias as a spokesman for Clinton’s campaign.

“No explanation was given for Kendall’s four years of false statements to the media,” Paul said.

Meanwhile, in his civil lawsuit, Paul is preparing a response to Sen. Clinton’s motion to dismiss the case based on California’s anti-SLAPP law, which protects politicians from frivolous lawsuits.

He expects the discovery phase of the suit to validate his charges as Sen. Clinton and other figures are forced to testify.

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