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More detail on the Lasater/Clinton connection.

THE ENFORCER AND THE BROKEN MAN
By Ambrose Evans-Pritchard
THE CLINTON CONTROVERSY
Ambrose Evans-Pritchard meets a man who has escaped three murder attempts. Now he lives in hiding with his family. He suspects that his links to an Arkansas company - a big contributor to Clinton's campaign funds - and a woman now senior in the White House made him a marked man

DENNIS Patrick was once a rising star in the Appalachian coal town of Williamsburg, Kentucky. He had made his mark as the youngest Circuit Court Clerk in the nation. The Republican Party was asking him to run for statewide office.

Now 42, he digs ditches for a living. For the past seven and a half years he has been in hiding with his wife and two children, afraid for his life. His friends do not know whether he is alive or dead.

He still does not know for sure what turned his life upside down. But he now suspects that it is related in some way to an investment banking firm in Arkansas called Lasater & Co.

The firm's owner, Dan Lasater, was the biggest contributor to the Arkansas campaign funds of Bill Clinton. The relationship between Lasater and Clinton, once intimate, has cooled over time but the connection between Lasater's world and that of the Clintons lives on in the person of Patsy Thomasson, staff director of the White House.

Thomasson was Lasater's deputy and confidante throughout the 1980s. As executive vice-president of the firm, she was in charge of operations, and was viewed by the rest of the staff as the main liaison between Lasater & Co and the Little Rock political establishment. In the late 1980s she served as head of the Arkansas Democratic Party.

When Lasater was sent to prison in 1986 for drug distribution - according to police files he served lines of cocaine on silver trays at parties - it was Thomasson who managed his business empire.

As head of personnel at the White House, she has access to confidential files on every staff member. Known as the Enforcer, she is said to be fiercely loyal to President Clinton.

Patrick was flabbergasted when he learned that she is now at the apex of power. He first heard about it in February on the radio, and it brought back of a flood of confused memories.

He rummaged through a pile of documents at home and unearthed a wad of trading receipts from a brokerage account opened in his name at Lasater & Co. According to the tickets, which he claimed he had never fully understood before, his account bought tens of millions of dollars worth of bonds in late 1985. On a single day, August 21, it purchased a mixed bag of Federal Home Loan Mortgage Corporation bonds worth $23.5 million.

"Not bad for a country hick from Appalachia," joked Patrick bitterly. He calculates that his total net assets then were about $60,000, including his house.

He claims that the transactions took place without his knowledge, but admits that he did become entangled with Lasater & Co for a brief period in 1985. It began when an old friend from college, Steve Love, took him fishing in the Gulf of Mexico and tried to persuade him to open an account. Patrick refused. The account was opened anyway, and credited with $21,000. Unwisely, he accepted the "profits". Over the next weeks he was wined and dined in Little Rock, and was even taken dove hunting in a party that included Clinton. Then Lasater & Co suddenly dropped him.

Love now lives in a small town in Pennsylvania. He was stunned when contacted by The Sunday Telegraph, saying that he too had been living underground for several years. "I was used by Lasater, and flushed away, my whole life destroyed. I finished up sleeping on park benches."

He said he was deeply sorry for what happened to Patrick, and denies having made the monster bond trades in the account. Those were done by a more senior broker, he said, for reasons that he dared not talk about.

It appears that the account was used to move large sums of money, but the purpose of the transactions is unclear. What is clear is that while this irregular bond trading was going on, Thomasson was the "financial and operations principal" of the broking house - one of the most senior figures in the firm. According to the Securities and Exchange Commission, she held the key 24 and 27 series licences, making her one of the most highly qualified broking principals in the country.

It was in late 1985 that Patrick's life began to fall apart. Somebody started sending paedophile literature to the Court House as if he had ordered it. Rumours circulated that he was involved in drugs. His house was fire-bombed. There were three separate attempts to have him assassinated.

"I never knew what was happening to me," he said in a melancholy voice, glancing nervously around the restaurant where we met. "All of a sudden I was tainted and nobody wanted to get near me. People would walk out of the barber shop when I came in."

He went to the police for protection but they told him his troubles were his own fault: he had got mixed up with drug dealers, they said, and he would have to look after himself.

So he bought a bullet-proof vest, booby-trapped his car and turned his house into a fortress. While his pregnant wife slept at night, he kept watch with a shotgun and an arsenal of loaded revolvers. Finally, he packed up the family and vanished.

After each assassination attempt the gunmen were arrested, prosecuted and served time in prison. In the police interrogation report of one, which was given to The Sunday Telegraph, the man confessed that he had been hired to murder Patrick and his wife for $20,000.

Local newspapers attributed the murder attempts to a dispute between Patrick and his business partners over some marginal oil-and-gas leases in Kentucky. But last month an investigator from the Bureau of Alcohol, Tobacco, and Firearms said he always had his doubts. "Somebody, somewhere, was really determined to kill this guy," he said.

Patrick wants the FBI to investigate whether the bond trading through his account at Lasater & Co had anything to do with the attempts on his life. Could it be, he asks, that it involved some impending court case, perhaps involving bankrupt savings and loans - the US equivalent of British building societies.

The Patrick story raises questions about the involvement of Lasater & Co in the S & L fraud that has cost US taxpayers hundreds of millions of dollars.

The Sunday Telegraph has transcripts of a 1986 meeting in Little Rock in which two Lasater brokers discussed a "scam" they were engaged in. Bonds were rotated through several accounts - including Patrick's - in a process of "churning", intended to generate commissions. When the principal on the bonds had been whittled down to a fraction of their face value, they would be dumped on a federally insured S & L. It is not clear how the scheme worked, or how the S & Ls were induced to act against their own interests.

The brokers listed several S & Ls in Illinois that had "taken the hit" from Lasater & Co. Most of them went bankrupt soon afterwards, leaving taxpayers to foot the bill.

Hillary Clinton and the late Vince Foster were the lawyers hired by the government on behalf of one of these, First American, to pursue a $3.3 million suit against Lasater. The Chicago Tribune has commented that their role in the suit was a flagrant case of conflict of interest, given the interlocking relationship between Lasater and the Clintons in Arkansas.

The suit was settled for $200,000, widely viewed as a surprisingly small sum. It was a secret agreement, with a strict ban on any dissemination of the facts of the case. As a result it is extremely difficult to establish exactly how or why the S & L collapsed. Congressional investigators are beginning to ask whether Hillary Clinton and Foster were involved in an attempt to draw a veil over Lasater's role in the whole S & L scandal.

There are further grounds for disquiet. Thomasson was one of the White House aides who entered Foster's White House office in the early hours on the night after his death on July 20 last year. Key documents were removed relating to Whitewater and other matters. Last Thursday Robert Fiske, the special prosecutor on Whitewater, issued a subpoena for all the documents relating to the death of Foster.

Over the next few weeks the activities of Dan Lasater - and, by association, Thomasson - are likely to come under close scrutiny in Washington. Senator Alphonse D'Damato, the ranking Republican on the Senate Banking Committee, intends to investigate the cosy way in which underwriting business for $660 million in state bonds was steered to Lasater & Co.

Among the many questions being examined is whether there were kickbacks to the Clinton campaign. It is reported that Lasater bond salesmen were encouraged to contribute to the Clinton war chest on the understanding that they would be reimbursed by the company. Former employees of Lasater describe a virtual tithing system.

D'Amato also wants to put the spotlight on the Arkansas Development Finance Authority (ADFA), a bank created by Governor Clinton in 1985 which was not subject to federal and state oversight. The ADFA board, which was appointed by Clinton, chose Lasater & Co to be the underwriter for most of its original bond issues.

There may be more to come yet. A book published in March, Compromised: Clinton, Bush, and the CIA, alleges that Dan Lasater was laundering money on a large scale through the bond system.

Evidence for this is scant, and mostly circumstantial. What has been missing up to now are specific, detailed examples of his brokers' bond trading.

Which is why Patrick's trading slips are so important.