November 22, 2007

New Ethics Woes For Clinton

InfoUSA now faces an SEC probe, one that could indirectly, at least, involve Bill and Hillary Clinton in the middle of an election campaign. The data processing company spent millions on Bill Clinton as a consultant and has flown Hillary around on its corporate jets. Now the SEC wants a look at the company's books, spurred on by stockholders who sense something amiss in the benefits showered on the former First Couple:

The Securities and Exchange Commission has launched an investigation into InfoUSA, a Nebraska company that used corporate funds to fly Hillary Rodham Clinton around the country, and one of only two companies to put Bill Clinton on its payroll after he left the White House.

The firm, a major provider of database-processing services, disclosed little about the nature of the probe in a filing to shareholders released yesterday.

The two-sentence filing said only that InfoUSA received a letter last week "informing the Company that the SEC is conducting an informal investigation . . . and is requesting the voluntary production of documents relating to related party transactions, expense reimbursement, other corporate expenditures and certain trading in the Company's securities." ...

Two sources familiar with the company's troubles suggested that investigators would focus their attention on executives' use of company money to feather their own nests. Gupta has been a major financial supporter of the Clintons since he met the president in the mid-1990s. Gupta and his company donated $1 million to help underwrite a lavish year 2000 New Year's Eve celebration at the White House and on the Mall.

He paid the former president $200,000 to deliver a speech to InfoUSA executives in Papillion, Neb., and signed the former president to a $3.3 million consulting deal. For the past four years, both Clintons have used Gupta's corporate plane, flying to Switzerland, Hawaii, Jamaica and Mexico -- about $900,000 worth of travel, The Post reported in May.

At the time this hit the news earlier in the year, some wondered why the SEC had not already begun an investigation into the publicly traded company. The political difficulties of conducting an investigation into a firm so closely connected to a presidential candidate are obvious. Even with stockholders going public with their complaints, the appearance of a political attack probably caused the SEC to take this very, very slowly and carefully.

Hillary Clinton hardly needed another ethics probe into her inner circle. She already faces a lot of questions regarding her close association with Norman Hsu, who apparently defrauded investors out of $60 million while pressuring them to contribute to Hillary's campaign. Her team also has an unrelated set of allegations to defend regarding suspect contributions from the Fujian community, where it appears straw donors helped launder some cash into her coffers.

InfoUSA hits at perhaps her most vulnerable point: Bill. Despite his popularity, few people consider him to have worthwhile personal ethics. Unlike the other scandals, this actually involves Bill and Hillary personally. If the SEC finds enough irregularities to file charges against InfoUSA, their association with the company will be another albatross around her neck -- an additional burden she or the Democrats hardly need in this cycle.


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