First Lady escapes criminal indictment

HILLARY CLINTON, who set a dubious precedent for First Ladies when she was summoned for questioning by state prosecutors last year, will not be indicted for any criminal offence, it was confirmed yesterday - at least not yet.

Mrs Clinton had been questioned six times in the labyrinthine Whitewater investigation, most recently 10 days ago when her evidence was videotaped for presentation to the grand jury.

Lawyers close to the investigation stressed, however, that some of the evidence gathered during the Whitewater inquiry could be submitted to the two other grand juries currently investigating alleged wrongdoing by the Clintons. One is considering the First Lady's involvement in dismissing members of the White House travel office and the possible misuse by the White House of FBI files; the other - whether Mr Clinton may have had an affair with a White House intern, Monica Lewinsky, and induced her to lie about it under oath.

The allegations against Mrs Clinton concentrated on legal work she transacted for a failed Arkansas bank more than a decade ago. She was then a partner in the Rose law firm and her husband was state governor.

The Clintons had invested in the speculative development project known as Whitewater, which was backed by the bank. They were suspected of abusing their influence to benefit themselves and their associates - even though the project failed and the Clintons say they lost money. That Mrs Clinton would not be indicted had been forecast with increasing confidence in Washington in recent weeks as the Arkansas grand jury approached the end of its mandate. Legal specialists agreed the indictment of a First Lady was unlikely without conclusive evidence of criminal activity.

The judicial shadow that has hung over Mrs Clinton for much of her husband's presidency has thus been lifted. Other Clinton associates have been less fortunate. The Clintons' former business partner, Susan McDougal, became the last person to be indicted in connection with Whitewater on Monday, when she was charged on three counts of refusing to testify and obstructing justice. Mrs McDougal has already spent 18 months in prison for civil contempt for refusing to testify. She claims independent prosecutor Kenneth Starr has put pressure on her to implicate Mrs Clinton.

The other, Webster Hubbell, a former partner - with Mrs Clinton - in the Rose law form and former number three at the US Justice Department, has also been indicted on multiple counts of tax evasion and fraud. Mr Hubbell, who has already served an 18-month sentence for fraud in connection with Whitewater, says he regards the new charges as a fresh attempt by Mr Starr to extract incriminating evidence from him against Mrs Clinton.

Mr Hubbell subsequently found himself at the centre of a feverish bout of Washington political in-fighting over taped conversations between himself and his wife while he was in jail. These suggested Mr Hubbell might know more about Hillary Clinton's legal work in Arkansas than he had divulged. Late on Monday, amid an outcry from Democrats, the full tapes were released, which showed Mr Hubbell specifically absolving Mrs Clinton.

While Mrs Clinton might be in the clear over Whitewater, neither she nor President Clinton are out of the woods yet. As if reasserting his authority, Mr Starr yesterday called Vernon Jordan, an influential black businessman and presidential confidante, to testify for the third time before the Washington grand jury in the Lewinsky case. Mr Clinton's private secretary, Betty Curry, is also expected to be re-called. Both are suspected of concealing what they know about the relationship between Mr Clinton and Ms Lewinsky, in particular whether Ms Lewinsky's silence may have been "bought" by a well-paying private-sector job arranged for her by Mr Jordan.