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Fund-Raising Probe Goes Public This WeekBy Lena H. Sun
Washington Post Staff Writer
Sunday, July 6, 1997; Page A14
Investigators preparing for Senate hearings that open this week have traveled thousands of miles, ridden ferries in Macao, dodged anti-U.S. protests in Jakarta, and even trekked to a Buddhist order's mountaintop headquarters in Taiwan.
They've scoured White House e-mail, telephone logs of the Democratic National Committee, and complex international financial transactions. They have their own "Deep Throat," an anonymous government source who regularly suggested fruitful areas to probe until he suddenly cut off telephone contact.
Those efforts have turned up some tantalizing nuggets about John Huang, the former Democratic National Committee fund-raiser who is at the center of the controversy, as the Senate panel investigating campaign finance abuse opens televised hearings Tuesday.
Still, don't expect the Senate panel to tie up all of the scandal's mysteries as neatly as an Agatha Christie novel. While Republicans say the hearings will produce substantive revelations about the role of foreign money and national security breaches, the panel has been stymied on some fundamental questions, sources on both sides of the aisle agree.
If there was a plot by foreign governments to pump money into U.S. elections, was it implemented, and if so, how?
Where did the three men who raised most of the questionable money for the Democratic Party last year Huang, Charles Yah Lin Trie, and Johnny Chung get their funds?
Was Huang engaged in an effort to funnel illegal funds into the campaign? If so, did anyone at the Democratic National Committee or in the Clinton administration know about it?
Did Huang pass classified information to his former employer, the Lippo Group?
These questions remain unanswered largely because some key witnesses are not cooperating. Trie, a former Little Rock restaurateur and friend of President Clinton, has fled overseas. Trie's Macao business partner, another important figure, hung up on an investigator who surprised him by calling his mobile phone.
Some others, like Huang, have invoked their privilege against self-incrimination. Former top DNC officials who have been enormously successful in business and politics have suffered major memory lapses. And partisan fighting has slowed the panel's ability to give witnesses immunity.
Ultimately, the answers to these questions may have to come from the Justice Department, which is conducting a separate criminal investigation into allegations of illegal foreign influence in last year's election.
Sen. Fred D. Thompson (R-Tenn.), who heads the Senate Governmental Affairs Committee and more than two decades ago was chief minority counsel to the Senate Watergate committee, has said he wants to let Americans look behind the curtain of government and the operations of last year's campaign.
"Is there a bombshell that is going to stand America on its head? I don't think so," said Paul S. Clark, committee spokesman. "But it's going to be productive and . . . new information will be given to the American public. . . . "
The hearings' first phase which will focus on foreign money will run possibly until the first week of August. Most of the allegations deal with the Democrats' 1996 presidential campaign, but Republicans also will have to answer charges that they illegally used foreign money.
For example, the National Policy Forum, set up by then-Republican National Committee Chairman Haley Barbour in 1993, received more than $700,000 in 1996 from a U.S. company controlled and funded by a Hong Kong business executive, Ambrous Young. The NPF has been described in documents as a "subsidiary" of the RNC. After Young's assistance to the NPF was disclosed recently, Republicans returned more than $100,000 in campaign contributions from him, his company or relatives.
The second phase, to begin after Labor Day, will focus on "soft money," the large, unregulated donations that corporations, unions and wealthy individuals give to the national parties and "reforming the system a little bit," spokesman Clark said.
The list of 30 potential witnesses in the first phase is heavily focused on individuals associated with Huang.
The committee is expected to call former White House and DNC officials to testify about the Clinton administration's need for cash after the Republicans swept Congress in 1994. Among the potential witnesses are Harold Ickes, Clinton's former deputy chief of staff who coordinated the president's reelection effort, former DNC co-chairman Don Fowler, former finance chairman Marvin Rosen, and former finance director Richard Sullivan.
Huang, the former head of the Lippo Group's U.S. operations, joined the Commerce Department as a midlevel official in mid-1994, and had unusual access to Clinton. He left the department for the DNC in December 1995 and became its chief fund-raiser in the Asian American community, collecting about $3 million. Republicans allege that Huang funneled money from Asian interests abroad to the DNC, and the DNC has returned much of the money he raised. Huang has denied wrongdoing.
While at the Commerce Department, Huang received classified briefings on Asia, even while he maintained ties to the Lippo Group. He called Lippo's Los Angeles office numerous times, sometimes soon after secret briefings or the receipt of classified documents.
The hearings also are likely to focus on the alleged laundering of campaign donations at the Hsi Lai Buddhist Temple in Southern California that hosted a fund-raiser featuring Vice President Gore in April 1996. And they are expected to explore what investigators have described as "straw donations" channeled through two Gaithersburg women from Trie's Macao business partner.
The temple fund-raiser was organized by Huang and another California Democratic Party activist, Maria Hsia. Among the temple-related witnesses who may testify are the abbess and bookkeeper. The temple repaid individuals who donated to three Democratic fund-raisers all organized by Huang including the controversial event attended by Gore, according to an internal Senate memo.
Investigators said bank records and other research suggest a temple "money-laundering" scheme that also extended to a February 1996 fund-raiser at the Hay-Adams Hotel in Washington and a July 1996 dinner at the Century Plaza Hotel in Los Angeles.
With regard to Trie, who worked closely with Huang, investigators are likely to call the two Gaithersburg women who were reimbursed for their donations, possibly from money that came from a foreign source, Trie's business partner, Ng Lap Seng.
Trie, who is believed to be in China, has denied wrongdoing.
Staff writers Ruth Marcus and Dan Morgan contributed to this report.
© Copyright 1997 The Washington Post Company