Clinton Cash: The Untold Story of How and Why Foreign Governments and Businesses Helped Make Bill and Hillary Rich Read online

  When President-elect Obama first floated Hillary Clinton’s name for secretary of state in late 2008, serious questions arose about the sources of funds donated to various Clinton interests. Many were troubled by the fact that so much of the Clintons’ newfound wealth was tied to foreign contributors. During her tenure as a senator, two-thirds of Bill’s enormous speaking fees had come from foreign sources. (As we will see, after she became secretary of state, Bill’s speaking fees and income from foreign speechmaking ballooned.) There was also the fact that tens of millions of dollars had flowed to the Clinton Foundation from the foreign governments of Saudi Arabia, Kuwait, and the United Arab Emirates, as well as from dozens of foreign financiers.

  Would Hillary feel indebted to these foreign donors? Would these relationships influence her decisions on matters affecting US interests?

  Some foreign newspapers raised concerns about her “impartiality” because of the money funneled to her foundation from certain countries.13 Some foreign observers viewed these donations not as acts of disinterested charity but as efforts to buy goodwill and influence from the incoming secretary of state. Donations from Indian billionaires and industrialists, wrote the Indian Express, were about “jockeying for access and influence. What else explains why [donors are] so keen to donate to the Clinton Foundation, when discharging its own commitments in India has been, at best, very reluctant?”14 The late Christopher Hitchens, writing in 2009, wondered the same: why didn’t these third world oligarchs “just donate the money directly [to charities in their own country] rather than distributing it through the offices of an outfit run by a seasoned ex-presidential influence-peddler”?15

  The Clintons dismissed such concerns. During Hillary’s confirmation hearings before the Senate Foreign Relations Committee, members from both parties openly worried about global influence peddling. Then senator Richard Lugar said it was a serious problem. Lugar is no bomb thrower but as Time magazine put it, “a paragon of bipartisan collegiality.”16 He also happened to be a friend of the Clintons.

  Lugar’s words were direct:

  The core of the problem is that foreign governments and entities may perceive the Clinton Foundation as a means to gain favor with the Secretary of State. Although neither Senator Clinton, nor President Clinton has a personal financial stake in the Foundation, obviously its work benefits their legacy and their public service priorities.17

  Lugar went on:

  But the Clinton Foundation exists as a temptation for any foreign entity or government that believes it could curry favor through a donation. It also sets up potential perception problems with any action taken by the Secretary of State in relation to foreign givers or their countries.18

  Hillary’s job was all-encompassing and touched on many vital issues with life-and-death outcomes. As Lugar warned,

  The nature of the Secretary of State post makes recusal from specific policy decisions almost impossible, since even localized U.S. foreign policy activities can ripple across countries and continents. Every new foreign donation that is accepted by the Foundation comes with the risk it will be connected in the global media to a proximate State Department policy or decision.19

  Lugar’s colleagues across the aisle shared his concerns. Senator John Kerry, chairman of the Senate Foreign Relations Committee, echoed the general view. “I think it’s fair to say that Senator Lugar is not speaking from a partisan’s perspective, but I think he is really expressing a view of the Committee as a whole.”

  Politicians weren’t the only ones nervous about the Clintons’ flow of foreign funds. Mainstream media outlets like Time warned of “the danger that [foreign funds] might taint Hillary Clinton’s role as Secretary of State.”20

  Hillary herself rejected the notion that a foreign government giving millions of dollars to her husband while she served as maestra of American foreign policy might present a problem. “Ultimately, there is no conflict between the foreign policy of the United States and the efforts of the Clinton Foundation seeking to reduce human suffering and increase opportunity for people in need,” she told the senators.21

  But the Clintons’ attempts to downplay or dismiss the issue failed to quell concerns.

  Incoming president Obama and his transition team were nervous about the influence of foreign funds as well. Before announcing Hillary as his choice for secretary of state, Obama directed his aides to conduct detailed and extensive negotiations with the Clinton camp over the issue. Doug Band, a Clinton confidant and top aide at the foundation, negotiated at length with Cheryl Mills, a former Clinton White House attorney who represented the Obama team. (Mills simultaneously served on the Clinton Foundation board, and would shortly be appointed Hillary’s chief of staff at the State Department. Like other key Clinton retainers, she will appear several times in these pages.)

  The two sides finally hammered out a memorandum of understanding (MOU). Bruce Lindsey, a longtime Clinton friend who ran the foundation, inked the deal between the Clinton Foundation and the incoming administration so Hillary’s nomination could go forward. Valerie Jarrett, Obama’s hard-nosed confidante, signed for the incoming president.

  The MOU required the Clinton Foundation to submit to several conditions designed to address widespread concerns about possible foreign influence coming through donations and speaking fees. For one thing, the Clintons agreed to submit all future paid speeches to the State Department ethics office for review. They also committed to publicly disclose on an annual basis the names of any major donors to the Clinton Foundation and its initiatives. Finally, the Clintons said they would seek preapproval from the Obama administration on direct contributions to the Clinton Foundation from foreign governments or government-owned businesses.

  Both Bill and Hillary were unequivocal in stating that they would be transparent about the flow of foreign money. In her written answers to the Senate Foreign Relations Committee, Hillary promised that “the Foundation will publish annually the names of all contributors for that year.”22 Bill went on CNN and said, “If she is going to be secretary of state, and I operate globally and I have people who contribute to these efforts globally, I think that it’s important to make it totally transparent.” Obama administration National Security Council spokesman Tommy Vietor agreed: “Going forward, all donors will be disclosed on an annual basis, and new donations from foreign governments will be scrutinized by government ethics officers.”23

  Some Clinton loyalists found these requirements heavy handed; they believed Bill and Hillary were “forced to go above and beyond the bar that would have been set for anyone else.”24 But who else in American politics would be so audacious as to have one spouse accept money from foreign governments and businesses while the other charted American foreign policy? Or would permit one spouse to conduct sensitive negotiations with foreign entities while in some instances the other collected large speaking fees from some of those same entities?

  For that very reason, the agreement was widely criticized for not going far enough. Senator Lugar was direct: “The only certain way to eliminate this risk going forward is for the Clinton Foundation to foreswear new foreign contributions when Senator Clinton becomes Secretary of State.” The Washington Post’s editorial page agreed, pointing out that “even if Ms. Clinton is not influenced by gifts to her husband’s charity, the appearance of conflict is unavoidable.”25 The Post warned, “The new administration is buying itself a heap of potential trouble with this agreement.”26

  Still, the agreement did the trick. The commitment to disclose and seek preapproval for government-tied funds left the Senate, the press, and the public with the widespread impression that these issues had been fully addressed. Hillary was confirmed as secretary of state by a 94–2 margin.

  But the claimed commitment to transparency was fleeting. The Clintons violated it almost immediately. As we will see, the Clinton Foundation failed to disclose gifts amounting to millions of dollars from foreign entities and businessmen who needed Hillary’s help as secretar
y of state to approve a transaction with serious national security implications. The Clinton Foundation also collected money from foreign government-owned businesses without getting prior Obama administration approval. And the pattern of taking money from businesses or individuals that owned entities that had matters before Hillary would continue unabated.

  Some might say it is unfair to connect Hillary’s public career as a US senator and secretary of state with her husband’s private commercial activities. After all, they both led active public lives and spent significant amounts of time apart. She seems to prefer their home in Northwest Washington, DC, while Bill spends much of his time in Chappaqua, New York.

  But by their own account, the two often work in tandem and are in regular communication. Hillary says, “[W]e have an endless conversation. We never get bored. We get deeply involved in all the work that we do, and we talk about it constantly.”27 Journalists who have traveled with the Clintons confirm this. When Andrew Jack of the Financial Times traveled with Bill in Africa for seven days, he noted “his frequent calls with Hillary during the trip.”28

  Spouses have long been seen as avenues for cronyism, corruption, and influence. That is why federal government ethics laws require politicians to disclose not just their own financial assets, holdings, and income, but those of their spouses as well. Enriching a politician’s spouse or family is one of the most common methods of political corruption. As secretary of state, Hillary pushed for international anticorruption standards that addressed this very concern.

  Others might argue that this is simply a “Bill problem.” They would like to divide the Clintons into “good Clinton” and “bad Clinton.” Hillary is the “good” one, the devoted and tough-minded public servant. Bill is the “bad” one, ethically challenged, pursuing money and personal desires. One magazine headline explained it this way: “Hillary’s big ethical problem: Bill.”29

  But as we will see, this is a crude caricature of their complex relationship. In a way, all that has really happened is that the Clintons have reversed roles. When Hillary entered the Senate, and then the State Department, she became the one who had real power, rather than Bill.

  How did the Clintons amass so much wealth in such a short period of time? The answer makes for fascinating reading.

  For one thing, the Clintons have operated at the fringes of the developed world, often appearing to assist in facilitating huge resource-extraction deals that are worth hundreds of millions of dollars. The era of globalization has opened up a Wild West bonanza where profits can be made on a scale not seen since the height of nineteenth-century colonialism. The Clintons’ most lucrative transactions originate not in places like Germany or Great Britain, where business and politics are kept separate by stringent ethical rules and procedures, but in despotic areas of the developing world where the rules are very different. Money also comes from foreign businessmen in Europe or Canada who have amassed their wealth in parts of the world where corruption and payoffs are simply a part of doing business.

  We will see a pattern of financial transactions involving the Clintons that occurred contemporaneous with favorable US policy decisions benefiting those providing the funds.

  Here is how it worked: Bill flew around the world making speeches and burnishing his reputation as a global humanitarian and wise man. Very often on these trips he was accompanied by “close friends” or associates who happened to have business interests pending in these countries. Introductions were made, deals struck, and photo ops arranged before an admiring foreign press. Meanwhile, bureaucratic or legislative obstacles were mysteriously cleared or approvals granted within the purview of his wife, the powerful senator or secretary of state. Huge donations then flowed into the Clinton Foundation while Bill received enormous speaking fees underwritten by the very businessmen who benefited from these apparent interventions.

  Of course, it is perfectly possible that in some cases Hillary did nothing at all to ensure these favorable outcomes. Perhaps these foreign interests made large payments to Bill simply in the hope of influencing Hillary. Maybe they were mistaken in thinking that multimillion-dollar payments to Bill and the foundation would have the desired effect. We don’t know. Either way, though, the Clintons ended up with the money.

  I realize how shocking these allegations may appear. Are these activities illegal? That’s not for me to say. I’m not a lawyer. But as someone once said, the most troubling thing about Washington is not what’s illegal but what isn’t. The Clintons are lawyers themselves and they know very well what legal lines they may not cross. By using their legal finesse, the Clintons have often skirted the boundaries of ethical conduct. They have been frequently censured and criticized for their conduct, but have usually escaped serious legal consequences. In a way, what you are about to read is similar to what they have always done, from Little Rock to the Lincoln Bedroom. They are just doing it now on a truly global scale.

  Unsavory foreigners with an interest in climbing higher up the global status chain have clearly seen the Clintons as a path to respectability and influence.

  Take the case of Gulnora Karimova, the eldest daughter of the dictator of Uzbekistan. In a country dominated by organized crime, forced labor, and torture, Gulnora is loathed by her country’s citizenry. As one US diplomatic cable put it, “Most Uzbeks see Karimova as a greedy, power-hungry individual who uses her father to crush business people or anyone else who stands in her way. . . . She remains the single most hated person in the country.”30 Being the most hated person in Uzbekistan is saying something. Her father, who still runs the country, is widely reported to have boiled his political opponents to death in the 1990s.

  Karimova is also glamorous and ambitious, and for a while she sported a fashion and jewelry line she tried to establish in Europe and the United States. According to a “secret/noforn” cable sent from the US embassy in Tashkent, Uzbekistan, to the CIA and other intelligence agencies in July 2009, she was “hoping that a connection with him [Bill] will allow her to establish good relations with the Secretary of State [Hillary].”31 How to go about it? She started by cosponsoring a Clinton Foundation fundraiser in Monaco. She posed with Bill for a photo at the event and soon NBC’s Today Show reported that Bill Clinton was “among her friends.”32

  Where it all might have led we will never know, because in 2013 Karimova had a falling out with her dictator father. As of this writing, she is thought to be under house arrest in Uzbekistan.

  Brash Gulnora Karimova was only expressing what so many foreign oligarchs and interested investors already know. And the Clintons know it, too. Supporters and opponents have called the Clintons many things over the years, but one word you never hear is naïve.

  CHAPTER 2

  The Transfer

  BILL’S EXCELLENT KAZAKH ADVENTURE

  On September 6, 2005, former president Bill Clinton found himself, of all places, in Almaty, Kazakhstan.1 A country with broad steppes and rugged mountains, Kazakhstan was a place where Genghis Khan once roamed. More recently, the comedy film Borat lampooned it as an impoverished country full of incompetents. In truth, however, the country sits atop a vast storehouse of minerals that includes an estimated $5 trillion worth of natural resources.2 Highly prized are the country’s immense uranium deposits—the mineral used to fuel nuclear reactors and build nuclear bombs.

  Bill Clinton’s Kazakhstan sojourn was ostensibly an effort to help the country’s HIV/AIDS patients gain access to lower-priced antiretroviral therapies. Yet according to the World Health Organization (WHO) and the United Nations Program on HIV/AIDS, at the time of Clinton’s visit, only an estimated fifteen hundred Kazakhs needed such treatments. In 2005 the prevalence of HIV/AIDS in Kazakhstan accounted for between 0.1 and 0.3 percent of its 15.4 million citizens, low compared with African countries like Botswana (24.1 percent) and South Africa (18.8 percent of adults).3

  All the more curious was the fact that Clinton had agreed to public and private meetings with the nation’s dictator, Nurs
ultan Nazarbayev, who had ruled Kazakhstan as president since 1990. Having risen through the ranks of the Communist Party during the Soviet days, Nazarbayev dropped the working-class rhetoric after the collapse of the Soviet Union and reverted to a classic despot. Indeed, “president” was a selected title. Kazakhstan doesn’t have elections as we think of them in the West. Nazarbayev regularly wins reelection with more than 90 percent of the vote. (In the last election, the candidates running against Nazarbayev claimed they voted for him.)4

  In short, Nazarbayev gets what he wants, one way or another. Despite a long marriage and an airline stewardess for a mistress, he was the father of only three daughters—no sons. Lacking a male heir, he arranged a relationship with the former Miss Kazakhstan Assel Issabayeva, and impregnated her via test tube. On April 2, 2005, she gave birth to his Sultanchik. Problem solved.5

  According to the Huffington Post, “Nazarbayev himself is rumored to be one of the richest men in the world, although no one knows exactly how rich, since he is alleged to have hidden interests in a variety of businesses.” Kazakhstan’s five billionaires all have close ties to Nazarbayev. Two of them are his relatives.6