Kalmen Stern, David Goldstein, Benjamin Berger and Jacob Elbaum, residents of the Chasidic village of New Square, had been convicted in 1999 on charges of swindling the government of $40 million in student grants, small-business loans and housing subsidies. They were sentenced to prison terms ranging from 30 months to 78 months.

Berger's sentence was reduced by Clinton from 30 months to 24 months, while Stern, Goldstein and Elbaum received reductions to 30 months.

The four men are followers of Rabbi David Twersky, the Skverer rebbe, who participated in an enthusiastic town reception last Aug. 7 for Hillary Clinton in her U.S. Senate campaign against Republican Rick Lazio. Mrs. Clinton subsequently received the votes of 1,359 New Square residents, compared to only 10 for Lazio. This contrasted with the votes in the Nov. 7 election of Chasidim in the nearby villages of Kiryas Joel and Kaser, which together favored Lazio over Mrs. Clinton by a margin of 3,480-152.

Since the furor erupted over the grants of clemency, Senator Clinton has said that the issue did not come up during the August campaign stop in New Square, located about 20 miles north of New York City in Rockland County. However, the New York Post, quoting unidentified sources, has reported that the matter in fact was discussed either during the visit in which Mrs. Clinton met with both Rabbi Twersky and his wife, or closer to the election. The newspaper identified Paul Adler, then a Rockland County Democratic party official, as a behind-the-scenes player. Adler since has been indicted by federal officials on an unrelated corruption charge.

Prior to the election, a letter from President Clinton was posted in the main synagogue in which he said he looked forward to making his own visit to New Square someday.

On Dec. 22, Rabbi Twersky and the deputy mayor of New Square, Izzy Spitzer, met President Bill Clinton and then Senator-elect Clinton in the White House Map Room, where the issue of clemency was discussed, along with other issues like the Middle East peace process and education, according to Rabbi Mayer Schiller, a spokesman for New Square.

What White is probing is whether clemency was promised before Mrs. Clinton was elected to the Senate, in exchange for a promise by the Chasidic leaders to urge a bloc vote for Mrs. Clinton's candidacy.--Donald H. Harrison