THE DNC'S LEGAL CHIEF September 10, 1997 Transcript

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A RealAudio version of this report is available. KWAME HOLMAN: The Senate Governmental Affairs Committee today continued to hear from those in charge of the Democratic National Committee during the 1996 presidential campaign. Washington lawyer Joseph Sandler was then and is now general counsel of the DNC. He defended the way his party amassed $350 million in political contributions, even though a small portion of it was returned because it came from questionable sources. JOSEPH SANDLER, General Counsel, Democratic National Committee: That's not a perfect record, to be sure, Mr. Chairman, but surely it demonstrates that the DNC did not deliberately solicit improper or illegal contributions, or turn a blind eye to the receipt of such contributions. In fact, the exact opposite is true. The officers and staff of the DNC during these past four years worked long and hard, often at great personal sacrifice, to vindicate the ideals of the Democratic Party. KWAME HOLMAN: Sandler then turned to an examination he carried out of a controversial set of some 47 fund-raising phone calls Vice President Al Gore made from his offices in 1995 and '96. In March, the Vice President told a news conference the calls did not violate prohibitions against raising political money from government facilities because the money he raised was unregulated, so-called "soft money." VICE PRESIDENT AL GORE: There is no controlling legal authority, no case ever brought, ever decided, that says that is a violation of law. KWAME HOLMAN: In the month since then Attorney General Janet Reno essentially has agreed with the Vice President, saying she would not ask for an independent counsel's probe of the fund-raising calls because they involved soft money. Today, DNC Counsel Sandler said his analysis also showed the Vice President was soliciting soft money, also known as non-federal campaign funds. JOSEPH SANDLER: All the materials that we have seen clearly indicate that the Vice President was soliciting non-federal money. KWAME HOLMAN: But that assertion was called into question a week ago when the Washington Post reported part of the funds Gore solicited went to so-called hard money accounts at the DNC, accounts regulated by federal law. Shortly thereafter, the Justice Department said it would begin a review that could result in a call for an independent counsel investigation. But the DNC's Sandler said the Vice President didn't know the funds were going to regulated accounts. JOSEPH SANDLER: Our procedure was to deposit the entire amount in the federal account, transfer the excess portion to the non-federal account, and because of internal DNC procedures, of which the Vice President would have no reason to be aware, the DNC--after the fact and without the Vice President's knowledge--deposited a small percentage of a portion of those contributions that he had solicited into our federal account. KWAME HOLMAN: Republican Counsel Sandy Mattice brought forward DNC memos that indicate the President and Vice President were advised the DNC was putting the money Gore raised into regulated hard money accounts. SANDY MATTICE, Republican Counsel: The issue that we're discussing is, is what may have been the Vice President's state of mind about whether he was raising hard or soft dollars. Go down to the final paragraph on that page of the document that says federal money is the first $20,000 given by an individual, $40,000 for a married couple, any amount over $20,000--over this $20,000 amount from an individual is considered non-federal individual. That is a policy, and I think that's consistent with what you just said, correct? JOSEPH SANDLER: I think, Mr. Mattice, this is Mr. Marshall's way of explaining the federal contribution limits in plain English. SANDY MATTICE: Okay. Well, in any rate, it does say that the first $20,000 given by an individual is federal money. I mean, it says that. JOSEPH SANDLER: Correct. SANDY MATTICE: Okay. Now, I just want to establish that this memo from Mr. Marshall was, in turn, passed along apparently, if you'll look at the first page of Exhibit No. 1065, to both the President and the Vice President on February 22, 1996, by Harold Ickes. You see that? JOSEPH SANDLER: I see it. This is not our document. SANDY MATTICE: I realize that. Have you ever seen it before? JOSEPH SANDER: I don't believe so, unless he showed it to me in my deposition, I wouldn't have seen it. SANDY MATTICE: But it does appear that Mr. Ickes passed along to the President and the Vice President the information that the first $20,000 of money raised was going to go into the DNC's federal account to the President and Vice President. And I just want to make sure--you don't know--do you know that the Vice President did indicate to the donor which accounts their moneys would be deposited into? JOSEPH SANDER: I don't know. I think it would be highly unusual for the Vice President even to be familiar with the seventeen or twenty different accounts maintained by the DNC, let alone discuss that in a two- or three-minute conversation with the donor. I don't know firsthand. It stretches, the credulity to surmise that. KWAME HOLMAN: Committee members also asked about a New York Times report today charging the DNC diverted some $2 million in soft money contributions into regulated hard money accounts, placing 62 donors in jeopardy of violating contribution limits. SEN. JOSEPH LIEBERMAN, (D) Connecticut: I found the story in the Times this morning to be very troubling, really awful, in the sense that contributors had their money allocated to accounts which they were not aware of. How do you explain how this happened? JOSEPH SANDLER: The-- SEN. JOSEPH LIEBERMAN: Let me put it more aggressively and have you respond to this. Was it carelessness, or in a sense bad intent, which is to say intentional carelessness because of the desire to put more money into the federal account? JOSEPH SANDLER: No. It was certainly not intentional in any way in that regard. The first months of 1996, with a change of staff in the finance administrator in our accounting department, it was not done properly. SEN. JOSEPH LIEBERMAN: There's an implication in the article, at least by one or two of the contributors quoted, that the first they heard about it--I may be reading it wrong--was when the reporter from the Times called them, is that not correct, or is it possible that that is correct? JOSEPH SANDLER: It is possible in some cases that--well, first of all, when this was corrected retroactively, unbeknownst to us, the people who were doing it did not go back far enough in time, all the way back to January, as they should have. That was a mistake. KWAME HOLMAN: Tomorrow, the committee will hear from National Security Adviser Sandy Berger, easily the most senior Clinton administration official yet to be called. Berger is expected to be asked about foreign-born contributors who attended presidential fund-raising events over the objections of national security officials.

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