The indictment, handed down by an investigative panel in Arkansas that is completing its last week of work, charged McDougal with two counts of criminal contempt of court and one count of obstruction of justice. She will now face a jury trial on the new criminal charges.

The charges come nearly two years after she first refused to testify before a Federal panel after being convicted by a jury on fraud charges related to the failed savings and loan at the centre of the original Whitewater investigation.

McDougal has already served 18 months for civil contempt for refusing to answer questions before the panel, the maximum time a Federal judge can order.

She was freed in March and is currently serving a prison sentence for the fraud charges stemming from her 1996 trial.

She wasbrought back before the panel last month and again refused to answer prosecutors' questions.

McDougal claims Special Prosecutor 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.

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

"We asked that the President urge mcdougal to testify truthfully to the grand jury and that was declined," Bakaly said. "We made those communications to the White House Counsel's office repeatedly and those requests were rejected."

Bakaly also expressed his frustration with McDougal's continued refusal to testify.

William Henley, Susan McDougal's brother, said before the indictment that she expected to take any new charges to trial so that she can present evidence concerning recent allegations that a key prosecution witness mayhave received financial assistance from conservative critics of President Clinton.

"I think it is going to give us an opportunity to show what a tainted investigation this was. ...If it will give us the opportunity bring evidence forward and to bring witnesses forward, Susan is more than willing to go through this," Henley said.

The grand jury in Arkansas, which is set to expire on Thursday after two years of work, reconvened on Monday as Starr continued investigating Webster Hubbell, McDougal and Hillary Clinton.

The investigation has narrowed its focus in recent months to Hillary's legal work for the savings and loan that Susan McDougal once owned with her former husband, the late James McDougal.

Prosecutors are trying to determine if Hillary, while a private Arkansas lawyer, assisted a series of fraudulent land transactions in the mid 1980s carried out by McDougal.