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02/09/98- Updated 10:22 PM ET

Report: Witnesses contradict fund-raiser

WASHINGTON - President Clinton's chief 1996 fund-raiser sought to steer big Democratic donors to Teamster President Ron Carey's re-election despite his sworn denials, two witnessses have told the Senate's investigation into campaign fund-raising abuses.

Terence McAuliffe, who was treasurer of the Clinton-Gore '96 campaign, said in sworn Senate testimony that he had no active part in discussions about a contribution swap scheme that triggered a federal grand jury investigation of the 1996 Teamsters election.

Matthew Angle, executive director of the Democratic Congressional Campaign Committee, told Senate investigators that McAuliffe "asked did we know anybody that could or would write a check to Ron Carey and that if we could help Carey, then we would perhaps get contributions back to the DCCC."

Rita Lewis, a Democratic Senatorial Campaign Committee aide, testified that "Terry said that if we ... could find a donor for Ron Carey's election" the Teamsters would "be more apt to give to Unity '96" - a joint fund-raising effort of three Democratic organizations.

Their testimony was summarized in an excerpt of the Senate Governmental Affairs Committee's report on campaign fund-raising obtained by The Associated Press. The report of hearings conducted last summer is circulating among Republican senators on the panel.

In another section, the committee concluded that Clinton's top political aide illegally "seized the reins of financial power" at the Democratic National Committee to "squeeze as much money" out of the party as possible for the 1996 re-election campaign.

A draft section of the Democrats' minority report says former GOP chairman Haley Barbour deliberatedly sought foreign donations for the National Policy Forum, a Republican think tank. Barbour "knew the money would be used to fund congressional elections in 1994" because the policy forum was "a de facto subsidiary" of the Republican National Committee, the excerpt said.

McAuliffe's testimony was contrasted with the accounts of the two Democratic fund-raisers in the segment of the majority report entitled "Misleading and Inaccurate Testimony."

McAuliffe testified that he had only one conversation about Teamsters donations. That was in May or June 1996 with Martin Davis, a political consultant who was working both for Democratic organizations and Carey's re-election.

McAuliffe denied that Davis asked him for help raising money for Carey. "I don't remember him specifically asking for that," McAuliffe said in a Sept. 18, 1997 deposition.

McAuliffe testified he only remembered Davis offering to help steer Teamsters donations to the Democratic National Committee, according to the report excerpt.

But when Davis pleaded guilty to participating in a scheme to illegally use the Teamsters to generate contributions to the Carey campaign, he said a "Clinton-Gore official" agreed to find a donor for Carey in exchange for a $500,000 Teamster contribution to Unity '96. "It was understood between us that he and others would try to identify a person who would contribute $100,000 to the Carey campaign," Davis said last fall. These discussions did not result in any Democratic money going to the Carey campaign.

The Senate excerpt identified McAuliffe as that official. The two other Democratic fund-raisers made their statements in sworn depositions taken by the committee's investigators.

The chapter noted that after reviewing the testimony of Davis, Lewis, and Angle, Senate investigators invited McAuliffe back for more questioning, but he declined.

The chapter concluded that the Justice Department investigation was needed to determine "whether McAuliffe or DNC officials violated federal law" by whether trying to swap contributions with the Carey campaign.

McAuliffe was traveling. But his lawyer, Richard Ben-Veniste, called the committee's account "grossly inaccurate and extremely damaging."

"It is quite clear from my review from the transcript of Terry McAuliffe's testimony that there is no inconsistency between his testimony and other testimony," Ben-Veniste said.

The committee concluded that the White House's desire to finance the ad blitz contemplated by Clinton campaign adviser Dick Morris led to "micromanaging how the DNC raised and spent money."

White House deputy chief of staff Harold Ickes "exerted direct control over the DNC's finance division," says the chapter on White House-DNC operations.

Clinton's attempt after the campaign finance controversy erupted to blame abuses on "the other campaign" at the DNC "rings hollow in light of the facts uncovered by the committee's investigation," the excerpts said.

The panel's chairman, Sen. Fred Thompson, R-Tenn., has long argued that such close coordination between the White House and the DNC was illegal, a contention disputed by White House and DNC lawyers.

"It is sad to see $3 million in taxpayer money being used to fund a partisan attack instead of a bipartisan call for campaign-finance reform," said White House spokesman Jim Kennedy.

The Democrats' section on Barbour said a $2.1 million loan guarantee came from a Hong Kong business instead of its U.S. subsidiary, as the former RNC chairman testified in hearings last summer. As soon as the policy forum obtained the money, it wired $1.6 million to the RNC.

"The fact is the (National Policy Forum) siphoned money from the RNC, it never funneled money into it. Every witness who testified before the committee ... said it was a legal transaction," said Ed Gillespie, a spokesman for Barbour.

By The Associated Press

Copyright 1998 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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