POLITICS : Entrepreneur Plays Key Role in Brown’s Financial Dealings : Nolanda Hill has emerged as a central figure as the commerce secretary’s investments undergo a federal investigation.

When President Clinton invited a small, select group of corporate CEOs to the White House for lunch in the summer of 1993, there was only one invited guest whose company was not listed among the Fortune 500.

Her name is Nolanda Hill, owner of a tiny, beleaguered firm known as Corridor Broadcasting Inc. and former business partner of Commerce Secretary Ronald H. Brown. By all accounts, Hill’s name was placed on the White House guest list by Brown.

Such experiences are not unusual for Hill, who by her own description was born on “the wrong side of the tracks” and has cultivated political and business connections to make her way among the rich and powerful in Washington.

In recent weeks, Hill, who boasts expensive tastes but who is millions of dollars in debt, has emerged as the main character in a slowly unfolding drama that began when Republicans in Congress began examining Brown’s investments.

The matter is being probed by the Justice Department and Federal Deposit Insurance Corp. and eventually could become the subject of a independent counsel’s probe into Brown’s business activities. On Thursday, Atty. Gen. Janet Reno announced a 90-day preliminary inquiry designed to determine whether she should ask the court to appoint an independent counsel.

Although Hill has kept most of her financial activities confidential, she has acknowledged defaulting on a $26-million loan while she was involved in a business partnership with Brown. Brown insists that he derived no benefit from the loan, which was made to another of Hill’s companies. But his financial association with her has attracted scrutiny because while she left the major debt unpaid, she bought out his interest in the other company for $412,000.

Congressional investigators also question whether financial benefits Brown received from Hill last year should have been specifically listed on his federal financial disclosure reports.

Through their lawyers and spokesmen, Brown and Hill have denied any wrongdoing. In letters to members of Congress, Brown has said that his now-dissolved business ties to Hill were entirely proper and that he never did anything for her as commerce secretary that would constitute a conflict of interest.

To congressional investigators, Hill has proven to be something of a mystery woman. Many business associates, one ex-husband and other acquaintances declined to talk about her with The Times. Only one photograph of her is publicly available, taken by the Washington Post in 1987.

In the past, Hill has told acquaintances that before she entered the business world she worked as either a professional singer or a classical pianist. But none claim to have seen her perform. She was listed in “Who’s Who of American Women” as a 1965 graduate of Stephen F. Austin University in Texas, but officials there say they have no record of her.

One of Hill’s first business transactions was a success, occurring in the early 1980s when she and her first husband, the late Sheldon K. Turner Jr., founded a television station in Dallas and then sold it in May, 1985, to media mogul Rupert Murdoch at a handsome profit.

After that, Hill, then married to prominent Dallas lawyer Billy B. Hill Jr., founded Hill Broadcasting--now Corridor Broadcasting--which owned small television stations in Washington and Boston. But Hill lost ownership of those stations in 1993 when Corridor defaulted on the $26-million loan.

Hill said she used the loan from Sunbelt Savings & Loan to buy and equip Washington’s Channel 50. One of her original partners in the venture was Thomas M. Gaubert, a Texas real estate developer, Democratic fund-raiser and S&L; owner with ties to Sunbelt who is serving a jail term for bankruptcy fraud and money laundering. Gaubert was represented for a time by Hill’s second husband.

While failing to repay the loan, investigators say, Hill maintained an opulent lifestyle using hundreds of thousands of dollars in corporate funds. Records show her firm paid for her first-class travel to Western Europe, Poland and Hungary, as she and Brown sought to arrange $20 million in oil purchases in 1991 and 1992 from the governments of Angola and Saudi Arabia. But the deals never materialized.

Her business outlays included luxury apartments in both Washington and Boston, thousands of dollars’ worth of cosmetics and a high-priced office directly across the street from Brown’s law firm, Patton, Boggs & Blow, according to the records.

In 1988, court records show, Hill filed a legal claim against a Nigerian taxi driver in Washington who she claims robbed her of between $80,000 and $100,000 of personal jewelry that she was carrying in a briefcase at the time. That same year, she paid $10,000 at a celebrity auction for a hat that once belonged to President Lyndon B. Johnson.

George J. Terwilliger III, Hill’s attorney, said it would be “really unfair” to conclude that she had squandered station assets on personal luxuries. “Operating TV stations is an expensive undertaking,” he said.

Beginning in 1990 as a friendship, Hill’s business partnership with Brown was mutually beneficial, even though it was not financially successful.

Hill made Brown a partner in First International Communications Inc.--one of her business entities--without requiring him to invest any money. Before he went to the Commerce Department in January, 1993, he valued his holdings in First International at between $500,000 and $1 million, making it his biggest single asset.

In return for his share of the company, Brown has said he gave Hill business advice. But the relationship with Brown also helped provide her entree to the White House and to elite circles of Democratic politics.

Hill also contributed to Brown’s fund-raising success at the Democratic National Committee.

In 1991 and 1992--at the same time she failed to make payments on her loan to Sunbelt--public records show that she and Corridor donated at least $77,825 to the party and Democratic candidates. Her $63,825 donation to the DNC put her in the same league with Shell Oil Co. and Chevron Corp.

In 1992, then-DNC Chairman Brown chose Hill to serve on the party’s convention site-selection committee, which one member described as the “ultimate perk” for prominent givers. Committee members made expenses-paid trips to several cities seeking the convention business, where they were treated to the best hotel accommodations, meals and other amenities.

When Brown became commerce secretary, Hill continued to rely on him for some business advice. He divested himself of his holdings in her firm after press accounts began to question whether his business ties might represent a conflict of interest.

Hill received the invitation to lunch with the President in 1993. Investigators also have found a memo Hill wrote on May 13, 1993, seeking Brown’s help in lining up a meeting with mid-level Commerce officials for John Foster, who became owner of her television stations after she defaulted. Commerce officials say that Brown did not arrange a meeting.

When Brown pulled out of First International, records show, the company’s primary asset was a promissory note from Corridor valued at $875,000, and that note provided its only income during 1993. First International had failed in a number of ventures, including efforts to import posters from Poland and to establish a satellite-television service in Eastern Europe.

After news of Hill’s unpaid loan was first reported by the Washington Post in November, 1993, Brown denied having any direct connection to Corridor Broadcasting. He has maintained that position, despite criticism about the financial relationship between the two firms.

Records show Hill arranged to pay $190,000 of Brown’s personal debts in 1994, after he relinquished his interest in First International on Dec. 15, 1993. In addition, he received three checks of $45,000 each from First International Limited Partnership--a separate firm--on April 15, July 21 and Oct. 15, 1993. Brown has said these were all part of the same deal to buy out his interest.

Records also indicate that the Jasas Corp., the Texas firm that bought Corridor Broadcasting’s assets from the FDIC for $3 million, contributed $72,000 toward the $190,000 that went to repay Brown’s personal debts.

Reid Weingarten, Brown’s lawyer, says Brown was unaware of Corridor’s indebtedness to First International and, instead, was under the impression that Hill’s businesses were thriving.

In addition, Weingarten dismissed as “hyper-technical” the growing congressional criticism of Brown’s failure to detail these payments fully on his annual financial disclosure report filed in May.

Nevertheless, Republicans in both the House and Senate have persisted in pressing for more information about his financial dealings with Hill.