Sunday, Jul 6, 2008
Ronald Burr confirmed to a friend and advisor that Olson was centrally involved in the Arkansas Project -- and led the charge to fire him after Burr demanded an audit.
May 24, 2001 | Editor's note: At the core of Democrats' criticism of solicitor general nominee Ted Olson is his inconsistent responses to questions about his involvement in the Arkansas Project, the $2.4 million investigation into the life of Bill Clinton, funded by conservative billionaire Richard Mellon Scaife and channeled through two nonprofit organizations run by the American Spectator magazine. Olson has adamantly asserted that he in no way played any part in managing the operation, and has claimed not to have heard about it until late in its life span, though he has been inconsistent in his answers about when he first learned of the project.
Now, on the day that Republicans are forcing a vote on Olson's confirmation, a friend and advisor to Ronald Burr, the deposed publisher of the American Spectator who once called for an internal "fraud audit" of the Arkansas Project, has written a letter faxed to Salon, reprinted below. According to previous reports in Salon, Olson was reported to have negotiated Burr's $350,000 severance package, which included "a provision that bars Burr from ever publicly discussing the circumstances surrounding his removal." Lemley says he played the role of "counselor and advisor to Ron during the events that led to his release by the American Spectator after thirty years of service." Lemley claims he learned from Burr that Olson knew of the Arkansas Project "if not in name then in its actions from the start, and Ted Olson led the charge to fire Ron Burr, the only executive at the American Spectator who had sought a forensic audit of the Arkansas Project."
Lemley alleges that Olson knew about the Arkansas Project more than three years earlier than he has said, because his "agreement in the winter of 1993-1994 to represent David Hale was a cornerstone of the project." David Hale, the chief witness against Clinton in the Whitewater investigation, was represented by Olson in order to quash a subpoena asking him to appear before the Senate Whitewater committee. Hale was the subject of a federal probe into whether or not Hale improperly received payments from Arkansas Project operatives. Burr could not be reached for comment Thursday about Lemley's letter. However, David Brock, a former American Spectator writer and now a chief Olson critic, told Salon, "I knew of Bud Lemley as an investment advisor to the American Spectator during years of the Arkansas Project. I knew at the time that they were close friends and that he was a confidante of Ron Burr." A call to Olson's office for comment was not returned by publication time. A Judiciary Committee staff member would neither confirm nor deny whether they had received the letter from Lemley.
The letter was copyedited and some relevant facts added in brackets.
-----------------------
My name is Ralph Lemley. I am a money manager with an office and business in Chicago, Illinois. I have been a personal friend of Ron Burr for 23 years. The following statement is a true rendition of my knowledge of the matter discussed.
I am releasing the statement because I have been approached by several reporters and asked about my relationship with my longtime friend Ron Burr, [co-founder and former publisher of the American Spectator], and my knowledge of the Arkansas Project. All my knowledge comes from conversations with Ron Burr during the year 1997, when I fell into the role of counselor and advisor to Burr during the events that led to his release by the American Spectator after 30 years of service. Recent news articles have suggested that Ted Olson discovered the Arkansas project in mid-1997 and sought an audit that closed down the project. These assertions are contrary to my firsthand knowledge of what really happened. Ted Olson knew of the Arkansas Project, if not in name, then in its actions from the start, and Ted Olson led the charge to fire Ron Burr, the only executive at the American Spectator who had sought a forensic audit of the Arkansas Project. And after Burr was fired, only a review and not an audit was conducted of the 501(c) 3 taxpayer-supported non-private foundation.
In my conversations with Ron Burr during 1997, Burr told me that Ted Olson was an integral part of the project because his agreement in the winter of 1993-1994 to represent David Hale was a cornerstone of the project. I spent the better part of 1997 counseling Burr, who had been with the Spectator since its inception in Bloomington, Indiana 30 years earlier. In our conversations, Burr said he was disturbed that over a three-year period almost two million dollars had been sent to a lawyer named Steven Boynton, at the direction of Spectator editor and co-founder Bob Tyrrell, to fund an operation named the Editorial Improvement Project. Burr told me the EIP was referred to as the Arkansas Project by those involved with it. [The money to fund the Arkansas Project came from Pittsburgh philanthropist Richard Mellon Scaife.] Burr, as publisher and treasurer of the American Spectator Foundation, had no idea how the money sent to Boynton had been spent.
In explaining his concern about the Arkansas Project, Burr told me he had received legal advice in 1995 and 1996 from two respected lawyers, William Lehrfeld and Mackenzie Canter, about IRS rules against excess benefits and"private inurement." Burr told me that he thought these proscriptions might apply to several directors of the foundation who were involved in the Arkansas Project, and result in the loss of tax-exempt status for the foundation. Because the Spectator was a charitable organization, the IRS was quite strict about directors being paid or receiving benefits greater than comparable work performed in the public sector. Burr also told me that the Spectator's regular auditor had raised questions on the same subject in a letter sent in early April 1997. Since the material in the letters was privileged, we didn't discuss the issue further, except that I urged Burr to obtain an audit of the project so that he would know how the money was spent.
Several days later Burr told me that he was being strongly opposed in his request for an audit by Bob Tyrrell and Ted Olson. During this time period Tyrrell sought to appoint Dave Henderson, who was a director of the foundation, to an oversight capacity in regard to Burr. In conversations about this appointment, Burr and I concluded that this appointment was the result of Burr seeking an audit of the project. Burr told me at this time that Henderson was Scaife's representative on the board of the American Spectator Foundation, and that Henderson, with the concurrence of Richard Larry of the Scaife foundations, had been instrumental in Olson joining the foundation's board in 1996.
The addition of Henderson to a management position at the American Spectator Magazine was discussed in full at a board meeting at the Waldorf-Astoria in New York in May 1997. In conversations with Burr before and after that meeting, he told me that Ted Olson had seconded the motion to give Henderson the management job and that the funding of the Arkansas project had been discussed. The reason Burr and I conversed about this meeting was that Burr saw the appointment of Henderson as an attempt to forestall his attempts to obtain an audit. Burr told me the Arkansas project was discussed at this meeting because the Scaife funds were behind in their payments and Burr was worried about paying Henderson's salary at the magazine, since Henderson was being paid by the Arkansas project. He also told me that mention of the Arkansas Project was not in the minutes of the meeting because a director had suggested that the minutes not reflect this discussion.
Get Salon in your mailbox!