A team of attorneys is representing the Clintons in negotiations with Obama officials, in talks which have taken place this week at a law firm in Washington.
Hillary Clinton still carries a substantial debt from her presidential campaign and if she were to become secretary of state she would face restrictions on her ability to retire it. As of Oct. 1, she owed nearly $8 million to campaign vendors.
In a 2001 advisory opinion, the federal Office of Special Counsel said a federal employee who still had a campaign debt would be prohibited from "personally soliciting, accepting or receiving political contributions." Clinton could name an agent from her campaign committee to continue to organize and hold fundraising events to retire the debt. Clinton would be limited to attending a fundraising event and stating her appreciation to donors.
According to Clinton's report, nearly $5.3 million of her debt as of Oct. 1 was money owed to the firm of Mark Penn, who served as her senior adviser and pollster.
Aides familiar with the vetting said it has gone smoothly and both Clintons had been fully cooperative with the process. One Clinton adviser noted that former President George H.W. Bush has given paid speeches and participated in international business ventures since his son, George W. Bush, has been president - without stirring public complaints or controversy about a possible conflict of interest.
Bill Clinton's network of business deals and charitable endeavors became an issue during Hillary Clinton's run for the Democratic presidential nomination.
One Democrat who advised her campaign said few of her senior strategists knew anything about the former president's business arrangements and whether they would hold up under scrutiny if she won the nomination. The adviser spoke on background, not authorized to speak publicly for Hillary Clinton's political operation.
During his primary campaign against Hillary Clinton, Obama pressed the former president to name the donors to his library. Bill Clinton refused, saying many had given money on the condition that their names not be revealed. He promised to make the donors' names public going forward if his wife won the Democratic nomination.
The former president has engaged in other deals that could complicate his wife's work with foreign governments as secretary of state. Records show he raised money for his foundation from the Saudi royal family, Kuwait, Brunei and the Embassy of Qatar, and from a Chinese Internet company seeking information on Tibetan human rights activists.
While many people familiar with the New York senator's thinking say she is inclined to take the secretary of state's job if it is offered, others say she is also considering the consequences of leaving the Senate, where she had hoped to take a leading role on health care reform and other issues.
"Would she be willing to give up her independent stature in the U.S. Senate, Robert F. Kennedy's seat, to be in the Cabinet? It will be a considerable decision for her," said Lanny Davis, a former Clinton adviser not involved in the vetting. "It's a completely different life than you lead in the Senate, where you are your own spokesperson, your own advocate. When you join the Cabinet of the president of the United States, that is no longer the case."
Clinton declined to discuss any part of the selection process Tuesday. "I've said everything I have to say on Friday," she said.
At the State Department, the prospect of Clinton as secretary is creating some anxiety among career foreign service officers worried that she would install her own loyalists and exclude them from policy-making. Some at the State Department see her as a foreign policy lightweight, although there is grudging acknowledgment of her star power.