What is now known as the Whitewater scandal had a very clear start, which included a land purchase in 1978. Bill Clinton and his wife, Hillary, helped James B. and Susan McDougal so that they could borrow a total of around $203,000 to buy 220 acres of land in Arkansas’ Ozark Mountains.

They soon formed the company called Whitewater Development Corp., intending to build vacation homes. On the land they bought, and James decided to also buy a small bank in Kingston, Ark., which he later decided to name “The Madison Guaranty”.

James used $30,000 from the bank in order to bribe Hillary to build a house on Whitewater. Soon after this transaction, the Federal regulators questioned James on his bank’s monetary stability and lending practices. About a year later, $50,000 more was taken out the same way to pay off the debt of the Clinton campaign. He also hired the Rose Law Firm, with Hillary as a partner.

James was removed from as the bank’s president, however he still kept ownership for another 3 years, until the bank collapsed. The government then spent around $60 million in order to bail the bank out, which caused James to be convicted for federal fraud.

Three years after James was convicted, while investigating the failure of Whitewater and Madison Guaranty, the Federal Resolution Trust Corp. sent a letter to the Justice Department saying that the Clintons are “potential beneficiaries” of illegal activities at Madison.

Deputy White House Counsel, Vincent Foster, filed three years of delinquent Whitewater corporate tax returns. About a month later heis found dead in a Washington area park. Police say that he committed suicide. Investigators weren’t allowed in Foster’s office immediately afterward, but White House aides entered shortly after his death, creating a possibilty that some files were removed from his office.

Webster L. Hubbell  resigned from associate attorney general after being questioned about his involvment in the Rose Law Firm. Two of Clinton’s political advisers call friends and have more than $500,000 sent to Hubbell. Hubbell is later on convicted of fraud from getting this money, and served 18 months in jail.

The Senate Special Whitewater Committee, chaired by Republican Alfonse D’Amato, begins hearings on Whitewater and on Foster’s suicide. One month after these hearings start, the grand jury charges James and Susan McDougal and Arkansas Gov. Jim Guy Tucker with bank fraud relating to questionable loans.

Six months after the hearing began, the committee finds Hillary’s Rose Law Firm billing records, saying that she had worked for 60 hours for the McDougals. Due to this find, Republicans suggest documents may have been withheld from them to hide how much work Hillary Clinton had done for Madison Guaranty, and ask to restart the hearing. The White House issues a denial.

Gov. Tucker and the McDougals ended up convicted of nearly all the fraud and conspiracy charges Starr had charged them with over 10 months earlier. James ended up dying a couple months before he had hoped to get out of prison, and his wife gets out of jail but refuses to testify.

On the first day of impeachment hearings, Starr decides to clear the Clintons in relation to any illegal actions brought against them. He also says his office drafted an referral stemming for Whitewater in 1997, but decided not to send it because the evidence was insufficient to prove that he had any part in major part in it.

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