FBI Raids Former Firm of Rep. Kim : Investigation: Agents seize records and computer equipment in their probe of possible campaign violations.

FBI agents searched the offices of JayKim Engineers Inc. in Diamond Bar earlier this week, hauling off documents and computer equipment during a raid of the corporation that was owned until recently by Rep. Jay C. Kim (R-Diamond Bar).

Sources said the Virginia office of a prominent accountant whom Kim recently hired also was searched this week for records that could shed light on whether Kim secretly used money from his corporation to pay some campaign expenses in violation of federal law.

Armed with a search warrant and video cameras, half a dozen FBI agents spent all day Thursday at the corporate headquarters of JayKim Engineers in Diamond Bar, taking away paperwork and removing computer equipment containing company data, sources said. Employees were interviewed in private sessions for up to two hours.

Kim and his chief of staff, Sandra Garner, did not return telephone calls Friday. Kim’s accountant, J. Stanley Huckaby, who served as campaign treasurer to former President George Bush in 1988 and 1992, was unavailable for comment.

Kim’s son-in-law, David Kim, who is running the company, on Friday confirmed the FBI’s presence at JayKim Engineers but said the inquiry centers “on a matter of Jay Kim, the congressman.”

An investigation was opened this summer by the FBI and Internal Revenue Service after The Times reported in July that Kim had secretly used hundreds of thousands of dollars from his corporation to pay congressional campaign expenses in 1992. During this time, the firm was slipping toward insolvency, and not paying some of its bills or taxes.

David Kim said the company and its employees are not under investigation and have been cooperating with federal authorities.

Assistant U.S. Atty. Stephen Mansfield, who is in charge of the investigation, declined to comment.

The search warrant was issued after a recent dispute over the firm’s response to a grand jury subpoena for documents. FBI agents apparently have complained that the company did not cooperate fully in answering a subpoena that was issued in July.

Julie Birkel, former attorney for JayKim Engineers, countered in a letter to federal authorities in August: “If anything, in an abundance of caution, the company produced documents well beyond the scope of the subpoena rather than withholding documents as your FBI agents apparently were alleging.”

Records show that Birkel’s law firm advised officials at JayKim Engineers in assembling documents for the grand jury and for Huckaby.

Kim hired Huckaby in July to review his campaign expenditures and company books to determine whether his corporation improperly paid any of his 1992 campaign expenses. Huckaby’s report has not been released, but Kim has said Huckaby has identified only $30,000 in corporate expenditures for the campaign that should be reimbursed.

According to the firm’s records obtained by The Times, JayKim Engineers Inc. provided Kim’s congressional campaign with free office space, staff and office supplies. The firm also paid Kim’s salary and expenses during the 1992 election, as well as campaign bills ranging from airline tickets to telephone service, records show.

Kim has said he instructed his staff to set up a special JayKim Engineers account to track the corporation’s spending on the campaign. His staff, he said, was supposed to send the campaign a bill, but never did.

Kim’s former top financial aide Fred Schultz has said he presented Kim with a monthly tally of campaign expenses paid by the corporation but Kim ordered him not to send the campaign a bill. Schultz made the statement in a defamation lawsuit he filed against Kim in August.

The Times has reported that a computer printout of campaign expenses charged to the corporation totaled more than $400,000.

Among the voluminous records subpoenaed by the federal grand jury was an order to submit all computer data relating to expenditures, payments or transactions between JayKim Engineers Inc. and either Jay Kim or the Jay Kim for Congress Committee. The grand jury subpoenaed all corporate records pertaining to Kim’s campaign as well as the campaign for “any other candidate for federal elective office.”

Federal election law prohibits corporations from donating directly or indirectly to candidates for federal offices. During the last four years, records show, Kim used corporate money to reimburse himself for more than $2,000 in personal contributions to other politicians.

In August, JayKim Engineers Inc. was acquired by a group of investors headed by David Kim’s father, Jaycee Kim.

Jaycee Kim said that he was unaware of FBI activity at the firm Thursday but added, “We have nothing to hide.”

He said IRS agents reviewed the firm’s records for several days recently, but “I don’t know what they found. They don’t tell us anything.”

Spiegel reported from Los Angeles and Ostrow from Washington.