Prior to taking office, Bill and Hillary Clinton had invested in the Whitewater Development Corporation, a real estate development company owned by Jim McDougal and Susan McDougal that quickly went bankrupt. The McDougals were later charged with fraud due to their activities connected to a savings and loan association. The July 1993 death of Deputy White House Counsel Vince Foster raised new allegations about the Clintons' connections to the savings and loan associations, marking the start of what became known as the Whitewater controversy. To defuse allegations stemming from Foster's death, Clinton authorized Attorney General Reno to appoint a special prosecutor under the terms of the Ethics in Government Act. Later, a special three-judge panel convened and appointed Ken Starr, a former U.S. solicitor general, as an independent counsel charged with investigating the Whitewater controversy. Starr's investigation expanded beyond Whitewater, in part because of a sexual harassment lawsuit filed against Clinton by Paula Jones, a former Arkansas employee.