The Federal Election Commission disclosed yesterday it has imposed a record-setting $719,000 in fines against participants in the 1996 Democratic Party fundraising scandals involving contributions from China, Korea and other foreign sources.
The FEC documents describe Democratic fundraisers who set specific prices for foreign nationals to make illegal campaign contributions in return for meetings with then-President Bill Clinton and Vice President Al Gore. A Democratic finance vice chair, for example, said organizers would have to contribute $100,000 in return for Gore's appearance at a Buddhist temple in Los Angeles.
Those penalized included the Democratic National Committee, the Clinton-Gore campaign, the Buddhist temple and nearly two dozen people and corporations acting as conduits for illegal contributions. All have agreed to pay, according to the documents.
The total in fines would have been significantly higher except that some of the corporations have folded and others were dummy operations, with no assets, set up as conduits for money from China, Venezuela, Canada and other countries. Foreign individuals and organizations are barred from contributing to federal elections. In some cases, foreigners who would have been subject to fines could not be located and served with papers. In other cases, the individuals pleaded guilty in criminal cases and are bankrupt.
The DNC was fined $115,000, the Clinton-Gore campaign $2,000, and the Buddhist Progress Society $120,000. In the conciliation signed by DNC lawyer Joseph Sandler, the party agreed to pay the fine and to "disgorge [another] $128,000" to the U.S. Treasury, representing illegal contributions that were not returned to donors.
In a separate document, the FEC said it decided to drop cases against contributors of more than $3 million in illegal DNC contributions because the respondents either are "out of the country and beyond our reach, or corporations that are defunct."
In more than 400 pages of documents, the FEC detailed a variety of illegal fundraising schemes in the 1996 Clinton reelection organization.
In some respects, the 1996 fundraising efforts by the Clinton White House and DNC were a Democratic counterpart to the Republican Watergate scandals of 1972. Just as Watergate was followed by the campaign finance laws of 1974 and 1976, disclosures of the 1996 activities played a crucial role in prompting Congress to enact the McCain-Feingold campaign finance bill this year.
The FEC describes how John Huang, a DNC finance vice chair in 1996, "set a goal of raising $7 million from the Asian-American community." This effort included the luncheon with Gore at the Buddhist temple, as well as a "coffee" at the White House and a "birthday dinner for President Clinton" at the Waldorf-Astoria Hotel in New York.
Huang, a central figure in the fundraising controversy, pleaded guilty in 1999 to conspiracy to defraud the FEC. He was sentenced to one year's probation and fined $10,000. The FEC documents detail several illegal contributions stemming from Huang's efforts, including:
* $250,000 from Cheong Am America Inc., a subsidiary of a Korean firm, Ateck Co. "On April 8, 1996, Cheong Am officials met briefly with President Clinton and gave John Huang . . . an envelope with a corporate check for $250,000 made out to the DNC," according to the FEC. The amount represented $50,000 for each of five company officials who met with Clinton.
* Huang received $40,000 from Indonesian nationals Arief and Soroya Wiriadinata that was deposited in the DNC's federal account in June 1996.
* Huang accepted $327,500 from Pauline Kanchanalak of Thailand, who attended "a White House 'coffee' with President Clinton on June 18, 1996." The FEC said Kanchanalak "paid a total of $277,500 for the coffee in installments" made out to state parties in order "to satisfy Pauline Kanchanalak's desire to avoid media attention."
The FEC documents indicate that Huang has agreed to pay a $95,000 fine.
The documents also describe how Robert S. Lee, a California developer, negotiated the price of a meeting between President Clinton and several executives of II Sung Construction, a Korean company. The documents say Lee met Larry Wallace, an Arkansas lawyer with DNC ties, to seek the meeting. Wallace told Lee "that he could arrange the meeting at a DNC fundraiser, but a donation would have to be made to the DNC." Wallace and Lee "agreed on a figure of $150,000."
The FEC fined Lee $250, noting that the penalty would normally be 200 percent of the violation, or $300,000, but Lee is $850,000 in debt and has already been sentenced to three years' probation on a misdemeanor.
The FEC documents are rich in detail on the behind-the-scenes world of political fundraising. They describe how Chien Chuen "Johnny" Chung brought 20 guests to a $1,000-per-person Clinton-Gore fundraising dinner in Los Angeles in 1995. Chung tried to pay with a $25,000 check, but it was refused by Karen Sternfeld, the campaign's deputy finance director for Southern California. She told Chung she needed 20 checks of $1,000 each from his guests.
The next day, Sternfeld asked Irene Wu, an employee of Chung's company, about the 20 checks, but was told the guests had scattered and the checks could not be obtained. According to the documents, Sternfeld said the checks did not have to be from the people who attended the dinner, and directed Wu to meet her at a restaurant later that day to deliver the money.
The documents said Wu and others then collected 20 checks of $1,000 each from "conduits," who were promised they would be reimbursed, and Chung later withdrew $20,000 in cash from his bank accounts to repay the conduit contributors.
Staff writer Susan Schmidt and researchers Alice Crites and Lucy Shackelford contributed to this report.