- The Washington Times - Friday, January 14, 2005

The federal government revealed last week that the finance director of Hillary Rodham Clinton’s Senate race has been indicted on multiple counts of fraud related to an August 2000 Hollywood fund-raiser, which reportedly raised at least $1 million in hard-money contributions and untold amounts of soft-money donations. It appears that the direct beneficiary of the alleged fraud was Mrs. Clinton’s campaign, which at the time was desperate for as much federally restricted, extremely valuable hard money that it could gather.

Probably indicative of the Bush Justice Department’s commendable determination not to inject the potentially explosive charges into the 2004 political campaign, federal prosecutors waited more than two and a half years to unseal the 10-page, four-count indictment, which was handed down in June 2002. The indictment by a federal grand jury charges David Rosen, Mrs. Clinton’s finance director, with repeatedly misrepresenting to the Federal Election Commission (FEC) the costs associated with an Aug. 12, 2000, fund-raiser. Officially billed as “Hollywood’s Gala Salute to President William Jefferson Clinton,” the event was actually a fund-raiser for “New York Senate 2000,” which was the primary beneficiary of the hard-money donations; the national Democratic Senatorial Campaign Committee, which received soft-money contributions that could be spent on behalf of Mrs. Clinton’s campaign; and a California Democratic Party committee.

Citing an FBI affidavit filed in the case, Jerry Seper of The Washington Times reported that the cost of the gala exceeded $1.2 million; however, FEC disclosure forms “incorrectly disclosed that the cost of the event was only $523,000.” The affidavit further said: “It appears that the true cost of the event was deliberately understated in order to increase the amount of funds available to New York Senate 2000 for federal campaign activities.”

The higher the cost of the gala, the more Mrs. Clinton’s campaign would be required to underwrite. Paying more to stage the event would have reduced the campaign’s net proceeds.

The indictment charges that Mr. Rosen obtained a fictitious invoice whose costs for the gala’s concert totaled $200,000. In fact, the concert, according to the indictment, cost $600,000. Moreover, while the event’s total cost of more than $1.2 million was largely financed by $1.1 million of in-kind contributions from a single person, according to the indictment, Mr. Rosen reported only $400,000 in such gala-financing costs.

As many as 1,200 people attended the event, which featured Cher, Diana Ross, Michael Bolton, Stevie Wonder, Melissa Etheridge and Patti LaBelle, among others. Attendees paid between $1,000 and $25,000. The first $2,000 of any contribution would have qualified as hard money in 2000.

The Los Angeles Times has reported that the gala “raised more than $1 million” for Mrs. Clinton’s campaign. That amount would have been much smaller if the costs of the gala were much larger, as charged.

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