Bill Clinton's disclosures: Questions yet

by Andrew Zajac

Last month, after his wife was nominated to be secretary of state, former President Bill Clinton attempted to put an end to speculation about his overseas fundraising by disclosing the names of some 208,000 donors to his foundation, which has collected more than $500 million to pay for a presidential library and to combat AIDS, malaria and other scourges.

But nowhere on that list was the name Sakura Capital Management Co. Ltd.

In 2003 Sakura, a shadowy, short-lived Japanese-American start-up company, paid Bill Clinton $500,000, the highest cash fee he has yet reported receiving for a speech, for a talk he never delivered.

As the Senate Foreign Relations Committee takes up Sen. Hillary Clinton's nomination today, she is expected to parry questions about whether she might be influenced in any way by any of her husband's donors by pointing to her husband's new openness. But as the Sakura tale illustrates, the disclosure does not answer all questions about Bill Clinton's associations.

Despite the disclosures, the former president's sprawling business and charitable activities retain the potential to complicate his wife's work as the nation's chief diplomat, said Robert Walker, former chief counsel of the House and Senate ethics committees.

"I think it remains a tricky, difficult situation, the safeguards that are in place notwithstanding," Walker said. "President Clinton's [previous] fundraising from foreign governments and foreign entities poses the potential for appearances of conflict. That's going to be there."

See the rest of the report on Bill Clinton's disclosures and unanswered questions in Tribune newspapers and here in the Swamp:

The Sakura money is shrouded in mystery and unanswered questions. Why was the fee so high, twice or three times what he was paid for other speeches on the same trip? Why was the speech canceled by Sakura, and why was Clinton paid the full amount anyway?

The company itself is murky. Sakura's former president, a New York securities dealer, says he only knew the last name of the partner who is said to have provided the money for the speech. The Panama-based former chairman of the company was the chairman of a bankrupt flooring company. Another figure in the company, a Japanese businessman, was accused in a 1998 lawsuit of helping defraud Casio Computer Co. Ltd. of $100 million.

Bill Clinton's spokesman at the William J. Clinton Foundation, Matt McKenna, declined to answer most questions about the speech, though he confirmed the payment from Sakura to Bill Clinton. The former president then donated the money to the foundation without taking a tax deduction, the spokesman said, which he said is why Sakura's name did not appear in last month's disclosures.

The payment was listed as personal income to her husband in Hillary Clinton's Senate financial disclosure form for 2003, he pointed out.

"He gave the foundation the $500K (less expenses), paid the taxes out of his own pocket and took no credit or deduction, " McKenna said.

Akira Hidaka, a Tokyo attorney listed on Sakura's now-defunct Web site as the firm's legal adviser in Japan, said he worked for the company briefly in 2003. He declined to disclose the identity of its Japanese principals but said his credibility was damaged by his association with the company.

Bill Clinton's involvement with Sakura was announced in a July 2003 press release written by veteran New York publicist Ken Sunshine.

Headlined "President William Jefferson Clinton to Address 'Embracing Our Humanity: Global Security in the 21st Century,' " it described an economic symposium hosted by Sakura to be "attended by several hundred of Japan's prominent civic and business leaders."

Clinton's Sakura engagement was to have been sandwiched around appearances in South Korea on Nov. 14, 2003, and Nisshin City and Kyoto in south central Japan on Nov. 19. His Sakura fee was double the $250,000 he was paid for the South Korea and Nisshin City speeches and more than triple the $140,000 he collected for his Kyoto appearance, according to Hillary Clinton's financial disclosure forms.

Sunshine said he wrote the releases at the request of John Matthews, a New York securities dealer who was listed as Sakura's president. Sunshine said Matthews is an old friend from Democratic political circles. Matthews managed an office for the late New York Sen. Daniel Patrick Moynihan in the late 1980s.

For his part, Matthews insisted that he had only a minor role in Sakura. "I was peripherally involved," he said.

But Sunshine's press release stated that "John Matthews, a financial services consultant, heads both offices in New York and Tokyo as president."

Matthews said he invested no money in the company and understood that financing came from a "Mr. Tanaka" in Tokyo. Matthews said he never met Tanaka, didn't know his full name and had no telephone number or other contact information for him.

Matthews said he dealt with Tanaka on the telephone and put him in touch with Clinton's representative, the Harry Walker Agency, of New York, which did not return messages seeking comment.

"I was just part of a corporation that was going to hold a conference and set up a financial services holding company" in Japan, Matthews said.

About a month before the Nov. 17 speech, Matthews said he received a call from Tanaka, announcing the cancellation.

"My guess is the [Japanese] partners had a fight. We were all supposed to go to Japan for the speech. I was very embarrassed," Matthews said.

He said Tanaka was an acquaintance of Sakura's chairman, Facundo Bacardi, who lives in Panama, and referred questions about Clinton's appearance back to Matthews.

In a biography on Sakura's Web site, Bacardi was described as chairman and president of Nations Flooring, a bankrupt carpet and flooring concern which eventually was liquidated. Matthews was listed as a director.

Matthews and others listed on the web site said that among those involved in setting up the company was Theoddor Tsuru, who in a 1998 suit filed in federal court in Manhattan was accused of helping defraud Casio Computer Co. Ltd. of $100 million. In 2000, Casio attorneys obtained a $64 million judgment against Tsuru. Efforts to reach Tsuru were unsuccessful.

Stan Brand, former general counsel of the House of Representatives, said that while Hillary Clinton was under no legal obligation to disclose details of the Sakura and other of her husband's engagements, such omissions could eventually hamper her foreign policy work.

"The question will come on a specific case. She will be forced to deal with an issue in a country where a contribution was made. The question will be 'what was the relationship' " between Bill Clinton and the donor, Brand said.

Hisako Ueno contributed to this report from Tokyo