Former top Reagan administration White House aide Michael K. Deaver over-reported by $950,000 contracts his public affairs company has with the South Korean government, company officials acknowledged yesterday.
In its original filings with the Justice Department's Foreign Agent's Registration Office, the Deaver firm, Michael K. Deaver and Associates, said it had been hired by the Korean government, a Korean government organization and a Korean public foundation, each paying $475,000 for one year.
The Korean Embassy, however, reacting to news reports detailing the extent that former high Reagan administration officials and influential Reagan-Bush campaign aides were representing foreign interests, denied Korea was paying $1.425 million to Deaver. Embassy officials said Korea only had one $475,000 contract with the Deaver firm, not three.
Yesterday, Deaver made it official, eliminating claims to two of the contracts, which the company said had been filed during a period of confusion over which organization would be the conduit for funds for a single contract. According to new documents placed in the public file at the Justice Department, the Deaver firm listed its contract with the Korean Broadcasting Advertising Corp. as "terminated." In addition, William F. Sittmann, a Deaver vice president, said in a telephone interview that the contract with the Korean government never existed.
"The Registrant [Michael K. Deaver and Associates] is no longer retained by the foreign principal," the Korean Broadcasting Advertising Corp., the new document said.
Which leaves Deaver with International Cultural Society of Korea as his $475,000-a-year client. In the original filing, that organization was listed as a "public foundation."
In a new filing, however, the Deaver firm said, "We have been informed that the International Cultural Society of Korea is a private nonprofit organization" that gets its funds from "commissions from government advertising, membership dues and donations from business circles."
"The reason that there were three registrations filed is that we have to file with the Justice Department within 10 days of receiving a contract. Every time we'd get a contract with the Koreans they would have a different group listed. The Koreans were trying to figure out what arm we would work with," said Sittmann, who also served in the Reagan White House.
On Capitol Hill, meanwhile, Commerce Secretary Malcolm Baldrige brushed aside concerns of congressional Democrats that government trade policies are being undermined by former Reagan administration officials and Reagan-Bush campaign aides who now are being paid millions of dollars to represent foreign governments and corporations.
"The problem is overrated," said Baldrige, who is responsible for carrying out many Reagan administration trade policies. "I haven't actually come in contact with any former high level officials who have tried to twist my arm unduly."
Deaver is the most prominent former Reagan aide representing foreign governments and corporations. Although he retired as deputy White House chief of staff last May, he retains his White House pass and remains a confidant of the president and Mrs. Reagan.
Two other public relations firms with close ties to the Reagan White House -- Gray and Co. and Black, Manafort, Stone & Kelly -- also are getting millions of dollars in fees from foreign clients, many of them engaged in trade battles with U.S. firms or the U.S. government.
"All the work that you do is futile if there is one call to the White House from a former colleague who says, 'Block Baldrige,' " said Rep. Don Bonker (D-Wash.), who was chairman of a House Foreign Affairs Committee hearing yesterday on U.S. trade problems.
"There have been some calls," the Commerce secretary acknowledged, "but Baldrige hasn't been blocked."
He said South Korea failed to stop President Reagan from ordering an unfair trade practices investigation into charges that U.S. insurance companies are not allowed to sell policies in the Korean market and that the president ordered an investigation into charges that Japan unfairly dumps semiconductors in the United States despite heavy lobbying against such an investigation.
"I did hear there were a lot of lobbyists calling on the White House" in the semiconductor case, Baldrige said. "That's legal," he continued, "as long as there is not any improper use of influence, and there wasn't."