S. Korean’s Firms Vanish After Gift to Democrats

The flamboyant South Korean electronics executive who ignited a national controversy in the United States with his illegal $250,000 contribution to the Democratic Party is now the center of a mystery in both Seoul and Los Angeles.

John Lee has not been heard from. His company, Cheong Am Business Group, which billed itself as Korea’s leading producer of outdoor electronic display boards, has vanished from its headquarters in Seoul and a subsidiary’s offices in Century City.

Left behind are telephone answering machines, a mailing address on Wilshire Boulevard and a web of confusion about a man who portrayed himself as a big player in South Korea and soon to become one on the West Coast of the United States.

“It’s like being captivated” by a ghost, said Kim Han Gil, a South Korean lawmaker, of the man who boasted of having friends in high government circles in South Korea, drove fancy cars and paid $250,000 to meet President Clinton.

A spokesman for Lee, Leonardo Kang, returning calls left on an answering machine, insisted Wednesday that the company was still operating in both Seoul and Los Angeles and had “nothing to hide.”

But he refused to disclose precisely where the company remained active, saying only that “somebody is going to destroy us” and adding mysteriously, “It’s not the proper time to tell you the whole truth.”

Lee himself could not be reached.

Lee’s actions and Cheong Am’s empty offices are likely to heighten the embarrassment for the Democratic National Committee, which appeared ready to accept the company’s generosity while asking few questions about the source of the funds. Democratic Party officials maintain that accepting Lee’s donation was an isolated mistake.

GOP Troubles Recalled

The intrigue recalled the difficulties the Republican Party had in 1992 with the $400,000 contributions made by Michael Kojima, a political unknown who subsequently sat at the head table at a fund-raiser with President Bush. He turned out to be a fugitive with a string of debts, including large amounts in child support.

Kang said that Lee was not hiding from creditors and “has no debts.” He offered to make Lee available at some future time.

The DNC returned Cheong Am’s money after being questioned about the contribution by The Times last month. The donation was illegal because Cheong Am’s American subsidiary was yet to generate any revenue, and foreign corporations are prohibited from donating to U.S. election campaigns. Moreover, foreign nationals such as Lee are barred from playing decision-making roles in making campaign contributions.

The Cheong Am disclosure helped trigger further revelations of large contributions to the DNC linked to a prominent Indonesian family with ties to Clinton. Some lawmakers, led by Sen. John McCain (R-Ariz.), a foreign policy advisor to Republican presidential nominee Bob Dole, have called for the appointment of a special counsel to look into the foreign donations.

Developing Doubts

Several well-known individuals in the Korean community in Los Angeles said they were initially impressed by Lee as an articulate, wealthy, well-connected businessman who suddenly appeared in Koreatown earlier this year, talking about buying a hotel and expanding his business in the United States. But they soon developed doubts.

Then, they said, he vanished.

“He talked big but he didn’t have the funds,” said George Chey, a board member of the Hanmi Bank in Koreatown and a Los Angeles resident for 40 years. He said of Lee and the company’s second-ranking executive, Young Chull Chung: “I think they were naive in the ways of America.”

Lee, who is in his 40s and prefers to be addressed as “Doctor,” told people he had a doctorate in psychology. Kang said that he was actually trained as a psychiatrist.

Lee expressed a desire to meet President Clinton to Mike Mitoma, the mayor of the city of Carson, Calif., and an international business broker. Mitoma, who visited Cheong Am’s offices in Seoul early this year, was seeking to assist the company in finding an American partner for a joint venture here last spring.

Mitoma said Lee sought the session primarily as a show of status. “It seemed to me he just wanted to say he knew the president,” the Carson mayor said in a recent interview. “He just wanted to have his picture taken with the president.”

Mitoma said he approached the DNC last year on behalf of Lee, after the businessman told him he wanted to meet Clinton. Mitoma said DNC officials arranged for Lee to meet Clinton at a $50,000-a-head fund-raising dinner in Washington in April, and Cheong Am subsequently bought five seats for $250,000. The DNC confirmed that Lee met Clinton at the fund-raiser.

Kang, Lee’s spokesman, agreed Wednesday that Lee’s interest was purely personal, not political. He said that Lee, who plays the piano and was a gospel singer in Korea, wanted nothing more than to be accompanied by Clinton on the saxophone.

“He has no interest in the Democratic Party,” Kang said of Lee. “He has a very personal interest in Mr. Clinton.”

Contribution Route

Cheong Am’s contribution went through John Huang, a vice chairman of the DNC’s national finance committee who specializes in Asian American donors and handled the Indonesia funds as well. The DNC has acknowledged that, in the Cheong Am case, its standard process of vetting contributions had “broken down.”

Huang, who had not earlier discussed the matter, said in written responses to written questions:

“I was under the impression, from discussions with the representatives of the company and other persons familiar with the company, that the company had already commenced actual operations in the U.S. I did not pose all of the proper questions to these representatives at the time and therefore did not question the source of the contribution.”

Mitoma apparently was one of those who participated in those discussions. He recalled that he was asked by someone from the DNC whether Lee had an American company. But he said he was not queried about whether the company was producing any revenue, nor was he asked about the residency status of Lee, who does not speak English and is generally accompanied by an interpreter.

Mitoma, who arranges joint ventures between Asian and U.S. firms, had visited Cheong Am’s headquarters in Seoul at the company’s invitation early this year. He said he was impressed with the firm, which expressed an interest in entering the U.S. market.

Mitoma said they “had just spent a lot of money remodeling their offices,” which he described as sumptuous.

Mitoma said he was picked up at the airport in Lee’s Rolls-Royce, one of a small number in South Korea, and taken around Seoul to see the enormous outdoor display boards that the company had manufactured, carrying news, advertising and train schedules.

Mitoma said Lee told him that he knew South Korean President Kim Young Sam and could visit the presidential residence “whenever he wanted to.”

A spokesman for Kim said that the president’s office did not know Lee. And Kang said that Lee “has no connection with the president.”

Mitoma initially suggested that Cheong Am locate its U.S. manufacturing plant in Carson. But he said he broke off discussions with the company after he witnessed a dispute between Lee and Young Chull Chung in a Los Angeles hotel.

Kang said Lee and Chung had split in a bitter fight over control of the company. In fact, he said that Chung at least claimed that he had wrested the firm from Lee. He said that this dispute has postponed Cheong Am’s plans to invest as much as $30 million in a U.S. operation. He said that Chung was “trying to destroy us by spreading bad rumors.”

Meanwhile, efforts to locate Cheong Am in Seoul in recent weeks have proven unsuccessful.

This summer the company, or its planning headquarters, left the Seoul high-rise where it had been located for eight months without leaving a forwarding address.

Kang, who joined the company earlier this year, said Cheong Am was the parent company of several firms, including one called A Tech, which manufactured the large-screen display boards. He said A Tech was still operating in Seoul, where he said Cheong Am has 100 employees.

Calls were placed to three companies named A Tech. The first two said they were not affiliated with Cheong Am, and the third number was no longer in service.

Locating Cheong Am has proved nearly as difficult in Los Angeles. The company abandoned its luxurious Century City office suite early last month, leaving no forwarding address, a building management executive said.

“They just up and left without telling us,” said the executive, who spoke on a condition of anonymity. “They vanished. We have no idea where they went to.”

Ocean-View Suite

The company had signed a three-year lease in May for a five-room suite with a sweeping ocean view on the 27th floor of the high-rise building. It gave the building management a $30,000 security deposit, but it remained there for only two or three months.

According to the California secretary of state’s records, Cheong Am America incorporated on Feb. 28, 1996, describing itself as a company of “business and financial consultants.”

It gave its address on the corporate documents as a suite in an office building on Wilshire Boulevard. But the company never used that address as anything more than a place to receive mail, a receptionist at the office said.

Kang said the Wilshire Boulevard address was initially used primarily on official documents to establish Cheong Am’s U.S. subsidiary. He said the company, which has seven employees in Los Angeles, left its Century City offices “because we have been bothered by the press, by other people.”

He refused to disclose the location from which he was calling, other than to say he was in Los Angeles.

“Someday,” he said, “I can tell you the whole story.”

Miller reported from Washington and Kang and Rosenzweig from Los Angeles. Times special correspondent Jung Nam Chi in Seoul contributed to this story.