August 3, 1994 - Part 4
August 3, 1994 - Part 4
(15:00:35) Senator BOND. Mr. Chairman, I hope the 10-minute cycle was not the reason for the lateness of the session last night. Let me move forward toward and see if we can stay within the 7 minutes. Mr. Ludwig, you are here today because you are one of the 40-plus contacts that occurred between the White House and Treasury over the Madison Guaranty case. These contacts begin when the President's friend, Mr. Altman, whom we've spoken about a great deal, took over the agency responsible for investigating Madison Guaranty and they ended about a year later after Mr. Altman recused himself and Mr. Fiske subpoenaed him. Over the past few days we've had a wide variety of excuses, explanations and we think some questionable evasions as to why the contacts occurred. But I think it's important that we remember the pattern because, although one individual or another may have a plausible explanation for one or two of the contacts, we need to look at them as a whole. The story is also playing out with the backdrop of Mr. Altman's testimony in which he said there was only one contact and now of course we know there are 40. We are unable to pin down all of those details. For my colleagues' sake, it seems to-me reasonable to put the story into some context and point out, for starters, that within a week of Mr. Altman's becoming head of the RTC and hours after his first learning that a criminal investigation of Madison Guaranty had occurred, there were the faxes and contacts with the White House from Mr. Altman's office. Contacts continued in the fall when Mr. Altman was notified of 9 additional criminal referrals which now also mention the current Governor of Arkansas as well as a distinguished former Senator, arid the Clinton 1984 gubernatorial campaign. There was a flurry of activity in October, the bizarre removal of the Chief Investigator Jean Lewis from the case on November 10. There was also action at the Department of Justice when Webb Hubbell and U.S. Attorney Paula Casey both recused themselves, These are issues obviously we will have to get into once we get past this stage of the hearings. That brings us to you. It was 10 days after the story broke concerning the Whitewater files being removed from Vince Foster's office that Mr. Clinton came to you. They may also have realized that now the White House has a civil case on Madison, and we wonder how these things all play out, and I would like to go back with you to the memorandum, your contemporaneous memorandum. I think You told us early on in your testimony today that you set forth in 72 your memo to Ed Knight of March 11, your memory at the time as to what occurred. Is that fair? Mr. LUDWIG. Senator, it was not a contemporaneous memorandum. My memorandum to the Executive Secretary to the Secretary of the Treasury, Ed Knight, was delivered in response to a grand jury subpoena request of the Treasury and of me. So I was recording some months later what had occurred. My memo was written in response to this grand jury subpoena request. Senator BOND. That was-nevertheless, that was closer to the time than this testimony, is it not? Mr. LUDWIG. It was closer to the time than this testimony, sir. Senator BOND. In that one you said that apparently the question was "whether it would be permissible for me as a lawyer knowledgeable about banking law to provide advice and counsel on any of the legal or regulatory issues." That was a troublesome phrase that was in that memorandum. Would you care to explain that, that phrase in the memorandum? Mr. LUDWIG. As I testified here this morning, sir, to the best of my recollection, the President asked me whether I could provide advice. As I understood it, the question related to regulatory, legal advice with relation to financial institutions' As I stated in the March 11th memo and I stated here this morning, the question was whether I could provide advice in that context; that's how I understood it.