Barrett's Report On Cisneros Reveals The Depth of Corruption In Clinton Administration

Any doubts this writer had about the extent and depth of corruption within the Clinton Administration were completely erased by the damming report Independent Counsel David Barrett released this week after a 10-year investigation of former Secretary of Housing and Urban Development Henry Cisneros and obstruction of justice by the Department of Justice and Internal Revenue Service to hinder Barrett’s investigation of Cisneros. For the American public, the report reveals the truth of our criminal justice system: everyone is not treated the same by their government when it comes to matters of criminal conduct. If you are part of the ruling elite as Henry Cisneros was, you can get by with just about anything.

To understand the origin of this investigation you have to know about the man at the center of the investigation. Henry Cisneros, a former popular Mayor of San Antonio, Texas, had become a leading star in the Democratic Party. As an attractive, Hispanic politician, his aspirations and the party’s expectations were very high. Walter Mondale almost chose him as his running mate in 1984, and many thought he would become the first Hispanic elected Governor of Texas or maybe even President of the United States.

Cisneros had just one big problem, not unlike President Clinton; he couldn’t keep his pants zipped. Cisneros’ political aspirations began spiraling downward in Texas after it became publicly known in the late 1980s that he had carried on a long-term romantic relationship with a campaign associate, Linda Medlar, outside his marriage. It also became publicly known that Cisneros had made “support” payments to Medlar out of a “moral obligation.” Although Cisneros and his wife separated, they later reconciled much to Medlar’s disappointment.

But Cisneros’ payments to Medlar continued, with plenty of pressure from Medlar, who taped all of telephone conversations with Cisneros ala Linda Tripp. As the transcripts of the phone calls made clear, Medlar fully exploited her knowledge of damaging dirt on Cisneros to extort money from him year after year, and that Cisneros willingly participated in the arrangement by any means available to him, legal and illegal.

According to Medlar, Cisneros had entered into an oral contract with her to pay her $4,000 per month until her young daughter became an adult. Cisneros endeavored through a variety of means to adhere to the contract, by hook or crook, allowing him to divert at least $300,000 to her from himself and others over a several year period from 1990 through 1994. Some payments came through members of Cisneros staff. Others were diverted from fees he earned for speaking engagements. And still others were made by a close friend and business associate of Cisneros.

Before a decision was made to nominate Cisneros as HUD secretary, President-elect Clinton’s transition team vetted Cisneros. Not surprisingly, the Medlar affair was a major concern of the vetters. Surprisingly, Cisneros was very candid with the transition team, admitting that he had regularly made $2,500 monthly payments, including some larger payments, to her over a several year period, and that he was attempting to negotiate a final lump sum payment to her prior to assuming his role as HUD secretary. He even admitted that he had at least 10 extramarital affairs during his marriage.

The Medlar affair troubled Clinton’s transition team, including Webster Hubbell, who would later become the number three person at the Department of Justice under Janet Reno, until he was forced to resign under an ethical cloud and later pleaded guilty to mail fraud and tax evasion in 1994. Hubbell, in one meeting with Cisneros, explained that Cisneros may have federal tax problems if he had paid Medlar more than $10,000 during any single year and failed to disclose and pay gift taxes on the amounts to the IRS. The transition team was also concerned that the payments might be viewed as “hush money”, and that Medlar might make trouble since Cisneros described her a “unstable.” Cisneros assured Hubble that the payments were only made out of a sense of a moral obligation even though he clearly knew otherwise.

The transition team informed Clinton and Vice-President-elect Al Gore about the Medlar affair. Clinton, himself a serial womanizer, agreed to move forward with the appointment as long as Cisneros got a “good lawyer”, dealt with the final lump sum payment to Medlar and cleared up any tax problems before taking office. The Clinton charitable view of Cisneros was not shared by Texas' then-Democratic Governor Ann Richards. She declined an opportunity at the same time to appoint Cisneros to the U.S. Senate to replace retiring Sen. Lloyd Bentsen. Richards told Cisneros that Texas' voters wouldn't stand for his affair with Medlar and the cash payments he had been making to her.

When the FBI conducted its background investigation of Cisneros, he made numerous false statements concerning the Medlar affair in sharp contrast with the statements he had given to the transition team. Specifically, he told the FBI he had never made a single payment to Medlar of more than $2,500, and that he had never given her more than $10,000 in a year. In fact, he had made 28 payments in excess of $2,500 to her. He also mentioned only one other extra-marital affair to FBI investigators. He also described Medlar as a "stable" woman. The transition team reviewed the FBI report and immediately became aware of the inconsistent statements Cisneros had given, but did not share that information with the FBI.

Instead, the nomination was allowed to move forward and Cisneros assumed his duties in late January, 2003 after Senate confirmation. The Senate Banking Committee, which reviewed the file as part of his confirmation process, was not told of the discrepancies. The Department of Justice granted Cisneros an FBI clearance, even though officials there also knew of the discrepancies of Cisneros’ account. Had the FBI known of the discrepancies, it would have immediately moved to suspend his clearance.

Despite the promises Cisneros had made to end the payments to Medlar, they continued even after he became HUD secretary. He made payments totaling $79,000 to Medlar in 1993 alone. He also arranged for a Texas businessman, Morris Jaffe, who Medlar claimed had made cash payments to Cisneros while he was mayor, to make payments directly to Medlar through one of his businesses. Top HUD officials also attempted to steer a HUD consulting contract to a business associated with Medlar.

When all payments to Medlar ceased in 1994, she sued Cisneros for breaching his contract with her, thereby opening the entire arrangement up to public scrutiny. An independent counsel was appointed with a very narrow focus of investigating whether Cisneros had lied to FBI investigators about the Medlar payments during his confirmation process. Although the Clinton Justice Department was well aware of the possible tax violations as noted in its own files on Cisneros, it did not include that in the initial charge of the independent counsel. When Barrett later tried to expand the scope to investigate all the tax years in question, Reno denied his request except for the 2002 tax year--presumably he had cleaned up his tax return that year to ensure his appointment in 2003.

Independent from Barrett’s work, the local IRS office in San Antonio opened up its own investigation of Cisneros concerning the payments. It sent a recommendation to the Austin IRS office to prosecute Cisneros for tax evasion and other tax-related charges. In a strange twist, the Assistant Chief Counsel’s office in the D.C. office, demanded that Cisneros’ case be transferred to its office, where the investigation ended. Despite a whistleblower notification to the Justice Department about the IRS interference with the Austin prosecution of the case and the D.C. offices inactivity on the case after assuming it, the Justice Department took no action and continued to deny Barrett’s office jurisdiction to hear the case.

In declining to investigate Cisneros’ tax problems, the Justice Department had been made well aware that an analysis of his tax returns had shown that he had made payments to Medlar far in excess of the disposable income he had to spend on him and his entire family during the period being scrutinized. So where was all the money coming from? Was Cisneros skimming? One of Medlar’s claims was that Cisneros had illegally accepted cash payments from Jaffe earlier several years earlier.

Barrett did, however, use the authority granted to him under his initial charge to investigate possible obstruction of justice charges against high-ranking officials in the Justice Department and the IRS. Barrett asserted in his final report that Justice had “resisted our efforts to investigate [the Cisneros matter]. He said, “Although we were are not able to say with certainty whether any criminal laws were broken, it is clear, I think, that there was questionable activity—as well as inactivity—by a number of government officials.”

Barrett has been heavily criticized by some in the media for dragging out his investigation, but as he makes clear, that was not of his doing. Medlar, after pleading guilty to numerous criminal charges, refused to cooperate with Barrett’s investigation, and when she did, she provided false and misleading information which hampered and delayed the investigation. She altered some of the tape recorded phone calls after her attorneys told her that they tended to show she was an extorter. Cisneros’ legal team also delayed attempts to prosecute him through numerous procedural maneuvers as laid out in Barrett’s report. The Justice Department and the IRS saw to it that Barrett was unable to investigate and prosecute serious tax law violations of the matter, and the Independent Counsel Act conveniently expired during Barrett’s investigation, allowing the Justice Department’s Public Integrity Section to assume jurisdiction of all other matters.

After several years, Medlar did provide enough cooperation for the independent counsel to allow her to end her time in federal prison, and to obtain an admission of guilt from Cisneros that he had lied to the FBI about the payments he made to Medlar. But the most serious charges of wrongdoing, the tax charges and the obstruction of justice, have gone unprosecuted.

The Cisneros-Medlar matter was just one small part of the widespread corruption within the Clinton administration. There was the Whitewater scandal, the travel office scandal, the FBI file scandal, the White House sleep-overs for campaign cash, illegal foreign contributions, the Ron Brown shenanigans at Commerce before and immediately after his untimely death and more, aside from the impeachment proceedings for Clinton’s admitted perjury in the Paula Jones lawsuit and his attempts to obstruct justice through witness tampering. The Clinton White House committed every wrong-doing Richard Nixon ever contemplated doing as president and then many more. The only difference is they were smart enough to play the system to their advantage.

But Clinton made sure he got the last word on these matters through his abuse of the President’s power to pardon people who have committed crimes in the past. Clinton granted hundreds before leaving office, including many involved in the various scandals of his administration. Included in those were full pardons for Cisneros and Medlar, thereby defeating any further attempts to bring the two to justice for the numerous other crimes they likely committed but for which they will never be prosecuted.

The next time you hear one of your Democrat or liberal friends complain about so-called corruption in the Bush Administration, just remind them of all the Clinton scandals. Privileged justice (not equal justice) under the law has always been the rule for the Clintons and their friends. Let’s hope the American people don’t make the mistake of electing the other Clinton to our highest office in the land.