Prosecutors are trying to determine if Hillary Clinton assisted a series of fraudulent land transactions when she was a private Arkansas lawyer.

BBC Correspondent Philippa Thomas reports from Washington (1'18")

They are due to report their results on Thursday, but have already announced that former partner Susan McDougal faces two counts of criminal contempt and one count of obstruction of justice.

She has already served an 18-month sentence for her refusal to testify to the grand jury, and will face a jury trial on the new criminal charges.

Kenneth Starr is accused of a politcally motivated investigation

McDougal claims independent counsel Kenneth Starr is trying to force her to lie about the Clintons in a politically-motivated bid to link them to a string of illegal business deals in Arkansas in the mid-1980s.

But Mr Starr noted that the indictment did not charge any wrongdoing by President Clinton or the First Lady.

His spokesman, Charles Bakaly, said prosecutors had repeatedly asked President Clinton to persuade McDougal to talk to the grand jury but all their requests were turned down.

But White House Counsel Charles Ruff angrily rejected as "reckless and irresponsible" the suggestion by prosecutors that Mr Clinton should have intervened personally in McDougal's case.

"The president has always urged everyone to tell the truth. At the same time, he understands that it is not appropriate for him to intervene personally in this matter,"

Lawyers for the President say he will not intervene in this matter

He described as "reckless and irresponsible" any suggestion that the president should do otherwise.

Mr Ruff also released two letters to Mr Starr, dated April 4, 1997 and Nov. 17, 1997 in which he had told the prosecutor it would be "entirely inappropriate" for Mr Clinton to intervene.

McDougal's attorney, Mark Geragos, attacked Mr Starr after the indictments were announced.

"It's shameful. It makes me angry both as her lawyer and an American," he said.

Susan McDougal, pictured with her late ex-husband who died two months ago`

McDougal and her former husband, James McDougal, were convicted on fraud and conspiracy charges in the first Whitewater trial in 1996.

After his conviction, James McDougal agreed to co-operate with Mr Starr but he died from a heart attack in a Texas prison almost two months ago.

It now seems very unlikely that an indictment will be handed down against the First Lady, when the Little Rock grand jury completes its two years of work on Thursday.