The Whitewater controversy (also called the Whitewater scandal, Whitewatergate, or often simply Whitewater) was an American political controversy that began with the real estate dealings of Bill and Hillary Clinton and their associates, Jim and Susan McDougal in the Whitewater Development Corporation, a failed business venture in the 1970s and 1980s.
David Hale, the source of criminal allegations against President Clinton in the Whitewater affair, claimed in November 1993 that Clinton, while governor of Arkansas, pressured him to provide an illegal $300,000 loan to Susan McDougal, the partner of the Clintons in the Whitewater land deal. Jonathan Broder and Murray Waas, 17news.html" target="_blank">"The road to Hale", _Salon.com, March 17, 1998. Accessed August 25, 2007. This allegation by Hale was questionable, as Hale had not mentioned Clinton in reference to this loan during testimony in the original FBI investigation of the failure of Madison Guaranty in 1989. Hale also had a history of creating dummy companies, then looting federal funds, such as SBA loans, from them, and allowing them to fail. Only after coming under indictment in 1993 for charges in just such a scheme did Hale make allegations against Clinton. Murray Waas, 17news.html" target="_blank">"The story Starr did not want to hear", _Salon.com, August 17, 1998. Accessed August 25, 2007.
A New York Times article published during the 1992 U.S. presidential campaign reported that Clinton and his wife had invested in and lost money in the Whitewater development project. Jeff Gerth, blank">"Clintons Joined S.& L. Operator In an Ozark Real-Estate Venture", March 8, 1992. Accessed April 30, 2007.
A _U.S. Securities and Exchange Commission investigation did result in convictions against the McDougals for their role in the Whitewater project, but the Clintons themselves were never charged. Bill Clinton's Lt. Governor, Jim Guy Tucker, was also convicted and served time in prison for his role in the fraud. Susan McDougal later served time in prison for contempt of court for refusing to answer questions relating to then-Gov. Clinton's role in Whitewater. Three separate inquiries found that insufficient evidence remained to charge the Clintons with criminal conduct in the land deal. blank">"Ray: Insufficient evidence to prosecute Clintons in Whitewater probe", _CNN, September 20, 2000. Accessed April 30, 2007.
The term Whitewater is also sometimes used to include other controversies from the Bill Clinton administration, especially those such as Travelgate, Filegate, and the circumstances surrounding Vince Foster's death, that were investigated by the Whitewater Independent Counsel.
