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Foreign Lobbies Took the Guise Of Nonprofits
The publicity provided a counterweight to Kim's troubles at home. He and other executives at Hanwha were under criminal investigation for allegedly bribing politicians in the company's 2002 takeover of state-controlled Korea Life. Within weeks of Clinton's visit, Kim and other Hanwha executives were barred from leaving Korea. One was later convicted in a bribery scheme. In February 2005, Kim was questioned by prosecutors but not charged.
The fact that the Korea council was a registered foreign agent was revealed in a March 2005 Post article. Some Congress members and aides who went on the trips said they had not known about the registration.
Former secretary of state Henry A. Kissinger, the best-known member of the Korea council's board, resigned, telling aides he had not known it was a lobbying operation.
A Scant Paper Trail
Like the Korea council, the U.S.-Malaysia Exchange Association sponsored trips by members of Congress and staffers. Some began with a meeting with Kim in Korea and finished with beach time in Langkawi courtesy of the Malaysia association.
The lawmakers and aides said they believed their travel was a legitimate function of a nonprofit group. In fact, the group's work was carried out on behalf of the Malaysian government and was funded by Malaysian business interests, both of which sought to improve the Islamic nation's image with U.S. politicians, according to public records and people familiar with the operation of the lobbying firms.
Much remains unknown about the U.S.-Malaysia Exchange Association because the only public documents are its incorporation papers and the biannual reports it filed with the District. On its board of directors were two Malaysian ruling-party officials, Jamaludin Jarjis and Megat Junid; former Wyoming senator Malcolm Wallop (R); and Stewart of Alexander Strategy.
According to the IRS, the group never filed a tax return. The IRS said the association was granted nonprofit status, but the agency could not locate the application.
The congressional trips were organized by and billed to Alexander Strategy, according to people familiar with the operation of the lobbying firm. Alexander Strategy received $620,000 in fees that originated with Malaysian business interests and was routed through a Hong Kong firm called Belle Haven Consultants, according to documents filed by Alexander Strategy with the Justice Department. Belle Haven also paid the Harbour Group $240,000, records show.
Wallop, who was hired to lobby for Belle Haven, said in an interview this summer that the Hong Kong firm got its money from P.K. Baru Energy in Malaysia. That company, he said, was one of the businesses that wanted to improve the nation's image in the United States after a disastrous 1998 visit by Vice President Al Gore, who walked out of a banquet to protest alleged human rights violations and anti-Semitic comments by Prime Minister Mahathir Mohamad.
"They wanted to make it known that it was a more civilized and courtly place than that," Wallop said. "A way to achieve that was to meet members of Congress." Some lawmakers who went on the trips received briefings from Belle Haven executives about Malaysia's strategic importance.
In their last two years of filings, Belle Haven's U.S. lobbyists reported that the Hong Kong firm was doing its work on behalf of the Malaysian government.
In 2002, the lobbyists took large delegations to Malaysia and Langkawi, including staffers to Rep. J. Dennis Hastert (R-Ill.), Sen. Harry M. Reid (D-Nev.), Rep. Richard K. Armey (R-Tex.) and Rep. Gregory Meeks (D-N.Y.). Meeks himself and Rep. Pete Sessions (R-Tex.), both on the House Financial Services Committee, went on one of the trips and met with officials of Malaysia's Islamic banks; the lawmakers' expenses were paid by a Malaysian think tank.