Salon Newsreal | Blood money

T A B L E+T A L K
Do you agree or disagree with President Clinton's decision to bomb Iraq? Join the debate in Table Talk's International Issues area

R E C E N T L Y
Portrait of a political "pit bull"
By Russ Baker
Rep. Dan Burton has a few questions to answer about his own history of womanizing and alleged campaign finance irregularities.
(12/22/98)
What if it were President Packwood?
By Andrew Ross
Liberals must face up to their hypocrisy in backing a president who lied under oath in a sexual harassment lawsuit
(12/22/98)
Life of the party?
By Joshua Micah Marshall
With Livingston gone, Tom DeLay runs the party
(12/19/98)
On to the Senate
By Harry Jaffe
With impeachment behind him, the president carries on. And on (12/19/98)
A plague on all their houses
By Murray Waas
On Capitol Hill, partisan hard-liners have damaged the constitutional democracy they claim to hold so dear
(12/18/98)
- - - - - - - - - - - - - - - -
Browse the
Newsreal Archives
- - - - - - - - - - - - - - - -

spacer

BLOOD MONEY | PAGE 1, 2, 3, 4, 5
- - - - - - - - - -
The Arkansas Board of Corrections, run by a Clinton appointee, was repeatedly informed of problems with the prison medical program, including the plasma business. But it continued to return the contracts to HMA, despite other bidders.
How did HMA hold on to the contracts, despite the repeated scandals? It had the help of many high-profile Arkansans, including Leonard Dunn, who became HMA's president. Dunn, a Pine Bluff banker, has deep roots in Arkansas politics. He worked closely with Arkansas political legends, including former U.S. Sen. David Pryor and Clinton. In fact, Dunn was a senior member of Clinton's 1990 gubernatorial reelection team. While in the financial business, Dunn worked at several banks in Pine Bluff and Hot Springs, which served as HMA's lenders. In 1990, he purchased Jim McDougal's Madison Guaranty Savings and Loan, the notorious S&L whose involvement in an obscure land deal led to an investigation that culminated in President Clinton's impeachment.
In recent interviews, Dunn has downplayed his role in HMA. Twelve years ago, he didn't. In the state police investigation, an investigator wrote that Dunn "advised that he had been a former member of the State Claims Commission under Governor Pryor and that he was close to Governor Clinton as well as the majority of state politicians presently in office. Mr. Dunn explained that he was very fond of politics." Dunn added that he was "the financial portion of the corporation as well as the political arm." But in a recent interview, Dunn insisted, "I never took an active role in the company on a day to day operational basis."
Yet Dunn took the lead in negotiating with state officials to get HMA's contract renewed in 1985. One unique feature of that negotiation was the decision to hire an "ombudsman," or compliance coordinator, to smooth problems between HMA and the state. During the state police investigation, however, the ombudsman contract was repeatedly described as a "bribe." Arkansas Board of Corrections Chairman Woodson Walker told investigators that the ombudsman was his idea. "The governor [Clinton] was deeply concerned with HMA's past performance," Walker told investigators, and Clinton said "that I would be held personally responsible for the performance of whatever medical provider was chosen." Woodson recommended renewing HMA's contract, but with an ombudsman position added as a "safeguard" to ensure HMA's good performance.
Both Walker and Clinton suggested HMA hire Richard Mays, an Arkansas lawyer and Clinton-appointed judge, HMA president Dunn told investigators. "Dunn stated that Walker advised him that Mays was black (a plus in a system where most of the inmates are black), had good qualifications and was an outstanding attorney," according to investigators' notes.
Mays is no stranger to Clinton scandals. He was accused of trying to quash the federal case against David Hale, Kenneth Starr's key Whitewater informant whose personal credibility has been repeatedly challenged. Mays is also credited with leveraging Little Rock restaurateur-turned-international businessman Charlie Trie's first $100,000 donation to Clinton's 1992 presidential campaign. Trie, whose Chinese and Indonesian connections have been the subject of controversy and investigation, has been a conduit for several controversial donations to the Democratic National Committee.
Mays' ties to Clinton continued in Washington. A former finance vice chairman of the DNC, Mays and his wife, Jennifer, stayed in the Lincoln Bedroom and attended White House state dinners. Mays did not return repeated calls from Salon about this story.
Dunn told investigators that HMA hired Mays for a two-year contract of $25,000. But during the investigation, no contract could ever be found, and the ombudsman position was considered by many within the prison system as a bribe. When asked about Mays' contract, prison Health Services Administrator Sam Jordison "appeared to be quite uncomfortable," investigators wrote. Jordison didn't call the Mays contract a bribe, but he did say, "I've talked to Mr. Mays on two or three occasions, and I never really knew what the hell he wanted. I do feel there was something here between Mr. Walker, Mr. Mays and HMA."
Henderson disputed that. He admitted to investigators that he "agreed to include the ombudsman so as not to endanger the continuing contract." In fact, the only work Henderson recalls Mays doing was helping create an affirmative action program and an employee handbook -- although affirmative action issues had not been at the center of allegations against HMA.
"[Mays] has met with us on three or four occasions and has mediated in some problem areas we have had," Henderson told investigators. "For a person who I would really not have hired on my own, Mr. Mays had been an asset in the overall operation of HMA." Ultimately, however, investigators were never able to find the contract that detailed Mays' official duties, or any record of how much money he received. But whatever Mays' official duties, hiring an ombudsman got HMA the contract, once again.
Not for long, however. The critical report by ILPP eventually drew blood. HMA was placed on probation following the report's release, and a few months later, the firm lost its contract to provide prison health care. HMA dissolved in 1986. Henderson says he wanted out of the plasma business. "It was getting too difficult to sell," he says. He still lives in Arkansas and works for a company that provides medical care in several Pennsylvania prisons.
N E X T+P A G E+| High-risk population? "I disagree with that"

- - - - - - - - - - - - - - - - -
Become a Salon member. Click here.

T A B L E+T A L K Do you agree or disagree with President Clinton's decision to bomb Iraq? Join the debate in Table Talk's International Issues area R E C E N T L Y Portrait of a political "pit bull" By Russ Baker Rep. Dan Burton has a few questions to answer about his own history of womanizing and alleged campaign finance irregularities. (12/22/98) What if it were President Packwood? By Andrew Ross Liberals must face up to their hypocrisy in backing a president who lied under oath in a sexual harassment lawsuit (12/22/98) Life of the party? By Joshua Micah Marshall With Livingston gone, Tom DeLay runs the party (12/19/98) On to the Senate By Harry Jaffe With impeachment behind him, the president carries on. And on (12/19/98) A plague on all their houses By Murray Waas On Capitol Hill, partisan hard-liners have damaged the constitutional democracy they claim to hold so dear (12/18/98) - - - - - - - - - - - - - - - - Browse the Newsreal Archives - - - - - - - - - - - - - - - -
		BLOOD MONEY \| PAGE 1, 2, 3, 4, 5 - - - - - - - - - - The Arkansas Board of Corrections, run by a Clinton appointee, was repeatedly informed of problems with the prison medical program, including the plasma business. But it continued to return the contracts to HMA, despite other bidders. How did HMA hold on to the contracts, despite the repeated scandals? It had the help of many high-profile Arkansans, including Leonard Dunn, who became HMA's president. Dunn, a Pine Bluff banker, has deep roots in Arkansas politics. He worked closely with Arkansas political legends, including former U.S. Sen. David Pryor and Clinton. In fact, Dunn was a senior member of Clinton's 1990 gubernatorial reelection team. While in the financial business, Dunn worked at several banks in Pine Bluff and Hot Springs, which served as HMA's lenders. In 1990, he purchased Jim McDougal's Madison Guaranty Savings and Loan, the notorious S&L whose involvement in an obscure land deal led to an investigation that culminated in President Clinton's impeachment. In recent interviews, Dunn has downplayed his role in HMA. Twelve years ago, he didn't. In the state police investigation, an investigator wrote that Dunn "advised that he had been a former member of the State Claims Commission under Governor Pryor and that he was close to Governor Clinton as well as the majority of state politicians presently in office. Mr. Dunn explained that he was very fond of politics." Dunn added that he was "the financial portion of the corporation as well as the political arm." But in a recent interview, Dunn insisted, "I never took an active role in the company on a day to day operational basis." Yet Dunn took the lead in negotiating with state officials to get HMA's contract renewed in 1985. One unique feature of that negotiation was the decision to hire an "ombudsman," or compliance coordinator, to smooth problems between HMA and the state. During the state police investigation, however, the ombudsman contract was repeatedly described as a "bribe." Arkansas Board of Corrections Chairman Woodson Walker told investigators that the ombudsman was his idea. "The governor [Clinton] was deeply concerned with HMA's past performance," Walker told investigators, and Clinton said "that I would be held personally responsible for the performance of whatever medical provider was chosen." Woodson recommended renewing HMA's contract, but with an ombudsman position added as a "safeguard" to ensure HMA's good performance. Both Walker and Clinton suggested HMA hire Richard Mays, an Arkansas lawyer and Clinton-appointed judge, HMA president Dunn told investigators. "Dunn stated that Walker advised him that Mays was black (a plus in a system where most of the inmates are black), had good qualifications and was an outstanding attorney," according to investigators' notes. Mays is no stranger to Clinton scandals. He was accused of trying to quash the federal case against David Hale, Kenneth Starr's key Whitewater informant whose personal credibility has been repeatedly challenged. Mays is also credited with leveraging Little Rock restaurateur-turned-international businessman Charlie Trie's first $100,000 donation to Clinton's 1992 presidential campaign. Trie, whose Chinese and Indonesian connections have been the subject of controversy and investigation, has been a conduit for several controversial donations to the Democratic National Committee. Mays' ties to Clinton continued in Washington. A former finance vice chairman of the DNC, Mays and his wife, Jennifer, stayed in the Lincoln Bedroom and attended White House state dinners. Mays did not return repeated calls from Salon about this story. Dunn told investigators that HMA hired Mays for a two-year contract of $25,000. But during the investigation, no contract could ever be found, and the ombudsman position was considered by many within the prison system as a bribe. When asked about Mays' contract, prison Health Services Administrator Sam Jordison "appeared to be quite uncomfortable," investigators wrote. Jordison didn't call the Mays contract a bribe, but he did say, "I've talked to Mr. Mays on two or three occasions, and I never really knew what the hell he wanted. I do feel there was something here between Mr. Walker, Mr. Mays and HMA." Henderson disputed that. He admitted to investigators that he "agreed to include the ombudsman so as not to endanger the continuing contract." In fact, the only work Henderson recalls Mays doing was helping create an affirmative action program and an employee handbook -- although affirmative action issues had not been at the center of allegations against HMA. "[Mays] has met with us on three or four occasions and has mediated in some problem areas we have had," Henderson told investigators. "For a person who I would really not have hired on my own, Mr. Mays had been an asset in the overall operation of HMA." Ultimately, however, investigators were never able to find the contract that detailed Mays' official duties, or any record of how much money he received. But whatever Mays' official duties, hiring an ombudsman got HMA the contract, once again. Not for long, however. The critical report by ILPP eventually drew blood. HMA was placed on probation following the report's release, and a few months later, the firm lost its contract to provide prison health care. HMA dissolved in 1986. Henderson says he wanted out of the plasma business. "It was getting too difficult to sell," he says. He still lives in Arkansas and works for a company that provides medical care in several Pennsylvania prisons. N E X T+P A G E+\| High-risk population? "I disagree with that" - - - - - - - - - - - - - - - - - Become a Salon member. Click here.