Rosen Is Racked: Clinton Hondler On Trial In L.A.

At first, the case against David Rosen was little short of unreal: He was the target of a civil suit filed by a prison inmate in Brazil. His co-defendant was Bill Clinton.

Then, one morning early in 2003, a half-dozen F.B.I. agents raided his office in the Lincoln Park neighborhood of Chicago, according to one person who was there at the time. Mr. Rosen, composed as ever in his bespoke suit, stood talking to his lawyer and patron, Myron Cherry, while the agents herded his staff into the kitchen, rifled through drawers and downloaded Mr. Rosen’s neatly, almost obsessively compiled records from computer hard drives.

“That’s when it moved from surreal to real,” said Chris Deri, a friend who worked with Mr. Rosen on Al Gore’s Presidential campaign.

The 38-year-old Mr. Rosen, a consummate political salesman who started his career selling books door-to-door, didn’t know it at the time, but he was already the subject of a sealed indictment by a federal grand jury in California. Now he’s on trial in a federal court in Los Angeles, charged with three counts of filing false reports with the Federal Election Commission. Each count carries a maximum penalty of five years in jail and $250,000, and Mr. Rosen is expected to take the stand in the trial, which began May 10 and could last another two weeks. Mr. Rosen was Hillary Clinton’s Finance director in 2000.

Clinton’s enemies, as well as her defenders, have tried to cast this trial in broader political terms: the latest sign of Clintonian criminality for the Hillary haters, and the latest evidence of the right-wing conspiracy for her backers. And a partial F.B.I. recording leaked to the New Orleans Times-Picayune of a conversation between Mr. Rosen and another fund-raiser offers a hint that he may have considered passing the buck to Mrs. Clinton or one of her top aides:

“The former White House wanted to … argue the case in a certain way,” the Times-Picayune quoted Mr. Rosen as saying. “And I did it for them. Like, I bit the bullet and went in as a guinea pig, and argued their argument for me. Instead of frettin’ and runnin’ and coverin’ my ass, I was a good soldier …. So far it’s worked out, but I coulda done it a lot different.”

To Mrs. Clinton’s organized critics, that’s a tantalizing hint. But Mr. Rosen, whose friends say he places a high value on personal loyalty, has shown no sign of turning on his former boss. And so it’s Mr. Rosen in the dock, even as the politicos on both sides whisper that the real culprits are elsewhere. Indeed, prosecutor Peter Zeidenberg has stressed Mrs. Clinton’s innocence in an apparent effort to keep the jurors focused on Mr. Rosen.

“You will hear no evidence that Hillary Clinton was involved in any way, shape or form,” the assistant U.S. Attorney said in his opening statement. “In fact, it’s just the opposite. The evidence will show that David Rosen was trying to keep this evidence from the campaign.”

Unlikely Star

Mr. Rosen is, in many ways, an unlikely figure to occupy the center of a high-stakes prosecution involving names from the Clintons to Cher and Diana Ross. Though he has spent the last few years at the top of the high-stakes, high-gloss Democratic fund-raising world, with clients that include former Presidential candidates Dick Gephardt and Gen. Wesley Clark and Governors Tom Vilsack and Rod Blagojevich, he arrived late on the political scene, and through an unconventional route. Those who know him-including most of the major players in the Democratic Party-are wondering whether his bootstrap intensity and visible hunger mesh with the prosecution theory that he panicked over mounting unexpected expenses for the extravagances he commissioned as part of his fund-raising, like Cher’s private jet.

The son of a doctor and a professor of religion, Mr. Rosen is an anomaly in the often blow-dried world of political fund-raising. He isn’t the son of a major donor or politician, or a Washington insider, or a former political staffer. He is, he liked to remind his colleagues, a former door-to-door salesman with an ambition and intensity that grated on some of his peers, but which made him one of the Democratic Party’s most successful money men.

(Attempts to reach Mr. Rosen at his office through his lawyer, Paul Sandler, didn’t yield a response. Many of Mr. Rosen’s associates, citing the ongoing prosecution, declined requests to comment for this story.)

Before Mr. Rosen switched to politics, he was the star salesman for Southwestern Co., a 150-year-old direct-selling company based in Tennessee, which dispatches thousands of college students to small towns every summer to sell educational books door to door. Dressed neatly in golf shirts and shorts, and up at 6 a.m., the salespeople are a feature of the small-town South and Southwest, and the program has a record of breeding politicians, from Senator Jeff Sessions of Alabama to former Independent Counsel Kenneth Starr.

Mr. Rosen was one of the best salesmen Southwestern ever had. He spent an unusual 10 years at the company, according to a company spokesman, after setting the record for first-year sales in 1984. He was so good that, by the time he left the company, he was making sales at five out of every six homes he visited, as a Southwestern official recalled to Crain’s Chicago Business in 2002, when Mr. Rosen was listed as one of the magazine’s top “Forty Under Forty.” (Company officials declined to speak about Mr. Rosen for this story.)

Mr. Rosen told the magazine that his door-knocking experience translated smoothly into politics.

“You can use it whether you’re selling airplanes, insurance or politicians,” he said.

Mr. Rosen’s life in Chicago, meanwhile, brought him unexpectedly into politics. Though he lacked family connections to Washington-he was married at the time to a Chicago police officer-he met a former chairman of the Democratic National Committee, David Wilhelm, when Mr. Wilhelm was his professor at DePaul University in Chicago.

Mr. Wilhelm put his eager student in touch with Democratic Party officials, and by the mid-1990′s, Mr. Rosen was working full-time as a fund-raiser for the Democratic National Committee in Washington. His ability to cultivate Democratic Party donors twice his age impressed his peers, including Mr. Deri, who met him in the run-up to the 1998 Congressional elections, when Mr. Rosen was fund-raising for Vice President Al Gore’s political-action committee in the Midwest and Mr. Deri was doing the same on the East Coast.

At a gathering of high-level donors in Nashville, Mr. Deri recalled, the staff fund-raisers were introduced from the stage, usually to a round of polite applause. Then Mr. Rosen was introduced.

“They said David’s name, and it was like 100 grandparents at a combination graduation–bar mitzvah, and the guy had scored a touchdown,” recalled Mr. Deri, who now works in public relations. “They just stood up and applauded. I remember, I called my wife afterward and I said, ‘I don’t know if I’m cut out for this. I don’t have the intensity to have relationships with all these people in a way that I could ever elicit that kind of reaction.’”

“He was very successful because he was very good with people. He did things in a very soft way-I don’t think he ever was a hard, demanding kind of guy,” said Bill Singer, a prominent Chicago Democrat. “I would stand by him in a minute.”

But what many donors found charming, some of Mr. Rosen’s peers and subordinates found grating. He pushed his subordinates hard and bragged about his access to the rich and powerful-something that has proved embarrassing on leaked prosecution recordings of Mr. Rosen’s conversations.

“He was the quintessential salesman,” said a former colleague on the Clinton campaign, of which Mr. Rosen was national finance director. “He was a little freewheeling, but he was no dummy.”

He also stood out in a world populated largely by well-coiffed young women who fit easily into the expensive world of big donors, and while some fund-raisers return again and again to established lists of donors, Mr. Rosen specialized in bringing in new money from Chicago entrepreneurs and other sources, people and companies that hadn’t ever participated in politics before. He wore his confidence on his sleeve; in fact, he had a tailor periodically appear at his office to measure him for custom suits.

But Mr. Rosen was also unusually successful, one of the best in the business. Indeed, he viewed himself as a bringing a new kind of professionalism to a business of personal relationships and small shops. When he created his own company after the Clinton campaign, he called it the Competence Group-a thinly veiled criticism of some of his competitors.

“He was frustrated when sometimes his trade was done by somebody really junior or somebody who didn’t have all the skills,” Mr. Deri said. “He wanted to make it a profession.”

And so the Competence Group, run out of the ground floor of a building he owns on Altgeld Street (Mr. Rosen lived upstairs) started big, with several employees and money from some of his wealthy connections.

“He always had to do things in a big way,” said another Democratic fund-raiser.

People familiar with the business said that Mr. Rosen had financial support from a number of Democratic donors, including Myron Cherry, a lawyer and leading Chicago Democrat. A person who responded to a call to Mr. Cherry said that Mr. Cherry was “not an investor” in the business but didn’t dispute the claim that the lawyer had given Mr. Rosen money. (The person who said he spoke for Mr. Cherry declined to give his name; the trial has made many of Mr. Rosen’s friends skittish about speaking to the press.)

Sketchy Characters

Even with the shadow of the investigation hanging over him, Mr. Rosen prospered in the last campaign cycle, with two Presidential campaigns as clients. Just after the 2004 election, he married a former aide to Mrs. Clinton, Melissa Rochester, in Chicago. But since his indictment was unsealed on Jan. 7, the focus of his life has returned to the glitzy Hollywood fund-raiser held in August of 2000 and featuring performances by Cher, Michael Bolton and Melissa Etheridge. Tickets cost $25,000 per couple for dinner and $1,000 for the concert. The guests included Brad Pitt and Muhammad Ali.

The details of the case against Mr. Rosen are highly technical, but the gist is that he underestimated the expenses of the Hollywood fund-raiser. This would allegedly have been useful to the Clinton campaign, because it would free up “hard money”-limited contributions that could be used for television advertising under campaign-finance regulations, if they were not spent covering the fund-raiser’s costs. But while the campaign reported costs around $400,000, prosecutors allege that expenses such as first-class commercial airfare for the stars’ entourages and expensive hotel rooms drove the total price much higher.

The prosecutor told the Los Angeles jury that Mr. Rosen told friends about an earlier Clinton fund-raiser that had cost more than it took in, and that the repeat of such an event would be a “career killer.”

“As costs mounted, this man began to panic,” said Mr. Zeidenberg, the prosecutor, pointing at the seated Mr. Rosen. “What would happen if he screwed up twice in a row?”

The party was hosted by two men who are now-as Mrs. Clinton’s lawyer likes to point out-both in federal custody on unrelated fraud charges.

One of them, Peter Paul, was a convicted felon who has since served time in a Brazilian prison and is now awaiting sentencing on a stock-fraud conviction. Mr. Paul, who filed suit against Mr. Rosen and Mr. Clinton, was the celebrity wrangler for the Los Angeles fund-raiser.

Mr. Rosen’s lawyer has argued that his client was duped by con men. And he has told friends that it wasn’t his job to vet Peter Paul, whose earlier criminal conviction would have been expected to raise flags with the Secret Service vetters and with the Washington law firm of Ryan, Phillips, Utrecht and MacKinnon, which was also vetting participants in the campaign. (Howard Wolfson, a Clinton campaign spokesman, said Ryan Phillips would have no comment on its role in the fund-raiser.)

Mr. Paul, who has launched a campaign to pin the alleged campaign violations on Mrs. Clinton, told The Observer that neither the prosecution nor the defense case makes sense, and that he would only have given money at the Clintons’ own urging.

“David Rosen couldn’t convince me to give anyone anything,” he said.

Mr. Rosen’s loyalty to the Clintons has been repaid, so far, by fierce defenses from Clinton spokespeople and quiet support from his cadre of donors. And the trial, in which most of the witnesses seem to hail from one corner or other of a sleazy underworld, hasn’t painted a flattering picture of the world of political fund-raising that Mr. Rosen mastered.

“What happened to David is what happens to everyone involved in this world,” Mr. Deri said. “You’re put in contact with sketchy characters all the time, and part of your job is to take direction as to who you’re supposed to be in contact with.”