The Clintons and the Ties That Bind

Former President Bill Clinton brimmed with excitement when he announced Delos Living LLC’s new plans at a 2012 meeting of the Clinton Global Initiative. “This is a really cool commitment,” he said. “I wish I were part of it–well, I sort of am now.”

He was about to pitch the group to a global audience, touting a for-profit enterprise funded and advised by his donors and friends. The idea was to create a new proprietary wellness standard for real estate by adding healthful features to interior spaces, such as cork-lined flooring, vitamin C–infused showers and electromagnetic shielding in the walls. Clinton presented the concept as a philanthropic effort more than a business. “Not just a green-building standard,” Clinton said, using prepared remarks that would form the linchpin of the company’s marketing efforts. “A well-living standard.”

Over the coming years, as Delos Living rebranded luxury properties, the company also gave between $500,000 and $1 million to the Clinton Foundation. One of the company’s construction partners, Webcor, gave $100,000 to $250,000; and a second partner, Shangri-La Construction, was founded by Clinton’s friend Stephen Bing, who has given between $10 million and $25 million. Terry McAuliffe, a former Clinton aide, was an adviser to the company before becoming governor of Virginia. In 2013, at another foundation event, Delos Living announced that it would build a children’s center in Haiti named after the former President. “Thank you,” Clinton said of the honor, before promoting the company’s proprietary ideas once more.

In short, this did not appear to be a normal charitable donation, but then the Bill, Hillary and Chelsea Clinton Foundation is not a normal charity. Lacking the deep pockets of other global philanthropies that are backed by billionaires like Bill Gates and Michael Bloomberg, the Clinton Foundation leans heavily for its funding on the family’s web of connections. And as the Clintons have worked to raise money, they have not been averse to calling on people they have helped over the years or providing promotional opportunities to donors.

As Hillary Clinton finalizes preparations for another presidential campaign, those practices have come under renewed scrutiny. During her time as Secretary of State, the foundation accepted donations from American corporations and foreign countries that were seeking the favor of the U.S. government. In at least one case, the foundation failed to notify the State Department about a donation from Algeria that passed through the foundation to help Haiti, a possible violation of an agreement signed when Clinton became the nation’s top diplomat. The foundation has denied any impropriety in these arrangements and maintains that donors like Delos Living were featured on the event program because of the altruistic potential of their work, not their financial contributions. “When people support the Clinton Foundation, they do want something in return. They want to see lives improved; they want to see the circle of opportunity extended around the world; they want to see communities, businesses and governments working together to address problems that we all face,” said Craig Minassian, a foundation spokesman.

Promoting donors is not the only way the Clintons have pressed the boundaries as current and former federal officials. In early March, Clinton advisers acknowledged to the New York Times that as Secretary of State, Hillary Clinton exclusively used a private email account run through a personal server at her home in Chappaqua, N.Y., for government business. That decision did not violate the law, but it contradicted ethical guidance from the Obama White House, which called for officials to use government accounts both for security reasons and to maintain a public record. Veteran operative John Podesta, who is likely to lead Hillary Clinton’s 2016 campaign, criticized the Bush Administration in 2007 for a similar practice of using private email. “At the end of the day, it looks like they were trying to avoid the records act,” he told the Wall Street Journal.

Clinton aides have recently turned over about 55,000 pages of emails to the archives of the State Department. But that will not be the end of the issue, as Republicans have promised further investigations, including possible subpoenas for documents that were not yet handed over to the department.

Such controversies have stirred concern among Democrats in Washington, who worry about harm to her reputation before the general election. “There is this whole dark part of the Clinton world, and nobody wants it to come back,” said one former Clinton adviser, who did not want to be named criticizing the party’s likely heir.

In 2014, with Hillary Clinton out of office and planning a presidential campaign, the foundation redoubled efforts to build a $250 million endowment. That same year, according to the foundation’s disclosures, it raised money from more than 1,000 donors and event sponsors. Contributions of at least $500,000–and possibly far more–came from companies like Goldman Sachs, Dow Chemical, Toyota Motor Corp. and Britain’s Standard Chartered Bank, which was fined $300 million by regulators last year for weak money-laundering safeguards.

Among the recent donors were businessmen who may in part owe their professional success to their access to powerful people. Vinod Gupta, a longtime political benefactor who hired Bill Clinton as a consultant to his company as recently as 2005, has given between $1 million and $5 million to the foundation, including donations in 2014. Investors in his former company InfoUSA sued Gupta for allegedly wasting company money on the Clintons. According to legal filings, InfoUSA estimated that Clinton’s consulting work may have led to business in excess of $40 million. Gupta declined to comment through spokesmen.

Delos Living, meanwhile, has continued to announce new projects. Among them are a WELL-certified Los Angeles office for the multinational real estate firm CBRE, whose board members include Laura Tyson, a former Clinton Administration official who has worked on several foundation projects; and Mickey Kantor, a former Commerce Secretary who chaired Bill Clinton’s 1992 campaign. CBRE consultants helped represent the Clinton Foundation in 2011 real estate negotiations for their New York offices. Lately, the firm has been helping Hillary Clinton’s staff find New York–area office space for the 2016 race.

–WITH REPORTING BY SAM FRIZELL/NEW YORK CITY; PRATHEEK REBALA AND HALEY SWEETLAND EDWARDS/WASHINGTON