Hil pal focus of donation payback probe
[Daily News Exclusive]
By GREG SMITH
DAILY NEWS STAFF WRITER
The FBI is investigating allegations that Denise Rich, the songwriter and wealthy Democratic Party fund-raiser, illegally reimbursed relatives and employees who donated to Hillary Clinton's Senate campaign, the Daily News has learned.
A grand jury is questioning witnesses in Manhattan Federal Court about the donations, as well as money donated to the New York State Senate 2000 campaign that ultimately supported Clinton, according to two sources.
One source said the FBI also is looking into possible obstruction of justice charges involving Rich.
The inquiry is part of a three-year-old probe that began after Denise Rich's ex-husband, then-fugitive financier Marc Rich, won a pardon from President Bill Clinton on his last day in office.
Denise Rich, a longtime Clinton pal and contributor, immediately came under investigation.
When the pardon scandal broke, she allegedly hired a lawyer for James Hester, a former employee who now says he was pressured to donate $2,000 to Clinton, a source said.
Yesterday, Hester's lawyer, Brad Simon, declined to comment except to acknowledge his client was questioned by the FBI recently.
"My understanding is the investigation is being actively pursued," Simon said.
Investigators also are looking into whether others were pressured to do the same with the promise of reimbursement, one source told The News.
Agents want to know whether Rich reimbursed several family members and associates who gave $5,000 each on Oct. 7, 1999, to N.Y. Senate 2000. That committee in turn supported Clinton.
Those who donated include her daughters, Ilona Malka Rich, an art gallery curator, and Daniella, an actress, her son-in-law, Phillip Aouad, and several employees of her recording company, IGD Music and Media, two sources told The News.
During the week in November 1999 in which Hester gave $2,000 to Clinton, the Rich daughters and son-in-law made identical donations, records show.
Denise Rich spoke several times to the FBI and prosecutors and has yet to be charged with any wrongdoing.
A spokesman for Manhattan U.S. Attorney James Comey declined comment.
Denise Rich's spokesman, Howard Rubenstein, also declined to comment, as did Sen. Clinton's office.
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