Details Emerge of Clinton Fund-Raising Involvement

During the Watergate investigation two decades ago, it was Sen. Howard H. Baker Jr. (R-Tenn.) who made famous the question: “What did he know and when did he know it?”

This year it was Bill Clinton rather than Richard Nixon who was seeking four more years in the White House, and Baker’s question developed a new twist: “What did he do and when did he admit it?”

It is becoming increasingly evident as each week goes by that Clinton was a major participant in the Democratic Party’s efforts--some of it in violation of federal law prohibiting foreign contributions--to raise an enormous war chest for the 1996 presidential election campaign.

Equally clear is that Clinton and his aides admitted almost nothing until his reelection was signed, sealed and delivered.

As a candidate seeking reelection, Clinton kept far out of range of reporters’ questions. Officials in his administration responded by pointing fingers in the direction of the Democratic National Committee and maintaining that the president had played no role in his party’s questionable fund-raising practices.

Since the Nov. 5 election, however, new disclosures provide strong indications that the president, his administration and Democratic Party officials withheld a wide range of potentially damaging information about foreign-linked campaign contributions before Clinton won another four-year term, records and interviews show.

In the weeks before the election, top White House, party and Commerce Department officials provided misleading accounts while also declining to release important details that probably would have intensified criticism of Clinton and the Democratic Party.

Just Saturday, the White House was forced to acknowledge a detailed plan to coordinate efforts by the White House, Clinton’s reelection campaign and the Democratic National Committee to boost the president’s standing among Asian Americans--at the same time that the party was aiming to raise as much as $7 million from this community.

“I’ve been around this town for 30 years and I’ve never seen a group raise stonewalling to such an art form,” said Stephen Hess, a Brookings Institution scholar on politics and the presidency. “This is nothing new for the Clintons . . . but they may ultimately pay a very heavy price for it.”

The portrait of Clinton now emerging depicts a president very much involved in his party’s money-making activities: Clinton presiding over an Oval Office meeting at which the first step is taken to hire a DNC fund-raiser to solicit contributions from Asian-Americans, Clinton meeting over coffee in the White House with small groups of potential big foreign contributors, Clinton chatting privately with major foreign donors at fund-raising banquets in glitzy Washington hotels.

Administration officials resent any comparison with the Watergate cover-up, which caused Nixon to become the only president in U.S. history to resign. They insist that they did their best during the hectic weeks before the election to provide accurate and timely information about Democratic fund-raising practices.

“We are taking hits now that we were conniving, Nixonian stonewallers only because we were in the middle of a national campaign and we didn’t have the resources to respond to this story,” said White House Press Secretary Mike McCurry.

Fund-Raiser’s Visits Described as ‘Social’

Consider the case of John Huang, the onetime Los Angeles executive for a multibillion-dollar Indonesian conglomerate called the Lippo Group, who became a Commerce Department bureaucrat and then a champion political fund-raiser for the Democratic Party.

Before the Nov. 5 election, White House officials portrayed Clinton’s relationship with Huang and the Jakarta-based Riady family, which owns the Lippo Group, as primarily “social.” Only after the election did Clinton and his assistants reveal that Huang and the Riadys had far more than casual chitchat on their agenda in private meetings and personal correspondence with the president.

At the national committee, officials initially concealed the extent to which Huang participated in soliciting more than $1 million in dubious and, sometimes, illegal donations from foreign sources that party officials later returned.

In early October, reporters began peppering administration officials with inquiries about Clinton’s ties to Huang and James T. Riady, the son of Lippo’s top official. Huang had received $879,000 in 1994 from the Riady family when he left the Lippo Group and joined the Clinton administration’s Commerce Department as a mid-level bureaucrat. The Riadys and Clintons have been friends since their Little Rock days. Lippo executives had contributed $475,000 to the Democratic Party since 1991.

On Oct. 15, White House deputy counsel Bruce Lindsey told The Times in a telephone interview that an Oval Office meeting he attended with Clinton, Huang and Riady in September 1995 was “basically a drop-by social visit” that included no discussion of substantive policy issues.

At the time, two lawyers assigned to the White House damage-control unit established to handle the Whitewater controversy, expressed their concerns to colleagues about Lindsey’s portrayal of the Clinton-Riady-Huang meetings. The lawyers, Jane Sherburne and Mark D. Fabiani, advocated describing the meetings “more fully” to include matters of substance that were discussed, according to senior administration officials. These officials said that Lindsey argued against providing a more complete accounting of the meetings.

Lindsey, a former Little Rock attorney who is perhaps the president’s closest advisor, said recently in a written response to questions submitted by The Times that he did not advise anyone to withhold major details of the meetings. “I expressed my opinion that to describe the two meetings I attended as policy-related would be mischaracterizing those meetings,” Lindsey said.

But the story changed after election day. Ten days later, Clinton disclosed to the New York Times that he and Riady twice talked about U.S. policy toward Asia. In early December, the White House released a three-page letter from Riady’s father, Mochtar, urging the president to establish normal relations with Vietnam, a country in which the Lippo Group was making extensive investments. Several top White House aides had known about the letter before the election but had said nothing publicly, according to a senior administration official.

White House officials also disclosed after the election that Huang mentioned the idea of taking a Democratic fund-raising post during his September 1995 meeting with Clinton. On Nov. 25, officials of the national committee said, the president instructed White House aide Harold M. Ickes to follow through on Huang’s proposal. This suggests that Clinton was more deeply involved in Huang’s hiring as a fund-raiser than the White House had let on during the campaign.

Deflecting the Spotlight

Throughout most of the campaign, according to McCurry, no one at the White House was directly in charge of responding to reporters’ queries about fund-raising practices.

“We were clearly trying to push this onto the DNC to respond and keep it away from the president and the campaign trail,” he said.

It was not until Oct. 30, six days before the election, that McCurry was assigned responsibility for managing the White House response to the foreign-money scandal. On the day before the election, McCurry alerted some reporters that James Riady had made between 14 and 20 trips to the White House.

“I felt a moral obligation to get some of this out by election day and, by God, I did,” McCurry said. “Granted, it was at the last minute.”

Ten days after the election, by contrast, McCurry conducted lengthy briefings for major news organizations on the precise number and nature of White House visits by Huang and Riady. Secret Service entry logs and interviews of White House personnel showed that Riady saw Clinton six times during his 20 visits to the White House and Huang saw Clinton 15 times during his 94 visits.

At the time, McCurry said that he had been authorized by Clinton to release all pertinent facts about any White House involvement with foreign donors. “At some point, our goal here obviously is to dump all this stuff, flush the toilet and say it’s all one big argument for campaign finance reform,” McCurry said.

Defending the Defense Fund

Only on Dec. 17 did the White House disclose that the president’s defense fund, which was organized last year to help the president and First Lady Hillary Rodham Clinton pay their mounting legal bills for Whitewater and other matters, had returned more than $600,000 in donations that did not meet the defense fund’s own rules.

The donations, purporting to come from a range of the Clintons’ supporters, were bundled together by a longtime Clinton friend, Taiwanese American businessman Yah Lin “Charlie” Trie of Little Rock. Trie had delivered the checks, many of which were in sequential order and in the same handwriting--in manila envelopes to the president’s lawyers in April.

Even though the Clintons were told that the checks were returned to Trie in June, the White House kept the information a secret during the campaign. Trie has acknowledged that he is among several Asian American donors who have made improper donations to the Democratic National Committee.

Justice Department prosecutors investigating the fund-raising scandal issued subpoenas to the White House in mid-December seeking records in connection with the defense fund.

About the same time, the national committee made available about 5,000 pages of internal memos and campaign finance records that show Clinton was much more involved in party fund-raising efforts than previously reported.

The documents, which were simultaneously turned over to a House committee, reveal that Clinton met privately at the White House for more than an hour at a time with small groups of potential donors who later gave large contributions to the Democrats.

In the first two months of this year, the documents show, a White House aide convened an Asian Pacific America Working Group of government and Democratic officials (including Huang) to coordinate the effort to woo Asian American votes and contributions.

A strategic plan drafted by a Democratic National Committee official set $7 million as its fund-raising goal for what it called “APAs” (Asian Pacific Americans). And it called for inviting major donors and campaign volunteers to the White House for “presidential coffee hours, campaign events, meetings and other special events.”

Among the people who met privately with Clinton at the recommendation of Huang was Pauline Kanchanalak, a Thai businesswoman who subsequently made six-figure donations that were later returned after it was learned that the source of the money had been concealed.

In addition, contrary to previous accounts by party officials, Huang arranged for Clinton to meet privately with John K.H. Lee at the same time that his South Korean company made an illegal $250,000 donation to the party. The president and Lee discussed the South Korean’s plans to establish a U.S. subsidiary in Carson, Calif., according to a senior White House official.

Questions of Event at Temple

This was not the only occasion when national committee officials provided misleading information or were less than forthcoming.

When questions were raised about a fund-raiser at the Hsi Lai Buddhist Temple in Hacienda Heights, Calif., DNC press secretary Amy Weiss Tobe would not confirm whether Huang was involved with arranging the event. She said that the national committee was operating under then-existing policies that prohibited the release of such information.

Only subsequently was it disclosed that Huang helped coordinate the fund-raiser. On Nov. 2--three days before the election--Tobe disclosed that national committee Chairman Donald Fowler attended the event and knew it was planned as a fund-raiser even as the featured guest, Vice President Al Gore, was denying such knowledge.

The national committee acknowledged that the event was improper because the party does not stage fund-raisers at tax-exempt religious institutions. Two donors’ contributions were returned as well because they were believed to be illegal.

Before election day, the Democrats also repeatedly refused to reveal how much money Huang had raised for the party. A week later, the national committee stated that Huang had generated $2.5 million. The documents released last week showed that the amount actually was $3.6 million.

It was not until the day after the election that party officials returned a $325,000 donation to Yogesh K. Gandhi after reports in The Times that he had testified in a court case in August that he was broke. Party officials said that the donation was not returned sooner because they had failed to obtain a transcript of the hearing from a Northern California small claims court. The Times had acquired the transcript eight days earlier.

“We had no intention of holding anything back until after the election because we were forthcoming with information to the press and the public pertaining to donations that were illegal or improper,” Tobe said. “Decisions were made to return checks when we had proper information to make those decisions.”

On Nov. 26, the national committee announced that it had hired a law firm and accounting agency to review all fund-raising activity and would cease answering questions about contributions solicited by Huang or anyone else. At the time, DNC officials said that results of the review would be disclosed in late December. Now, they do not expect the information until early next month.

“We want to get our own house in order before we start answering questions,” Tobe said.

Before Huang joined the national committee, he was a political appointee at the Commerce Department, where he served as an assistant secretary for international economic policy.

The Commerce Department reported before the election that Huang, who was a deputy assistant secretary for international economic policy, had virtually no involvement in foreign trade matters affecting the Riadys’ global financial interests. Yet internal documents released earlier this month show that Huang was an active participant in government projects that directly affected his former employer, the Lippo Group. For instance, Huang was part of a Commerce trade promotion council that sought to arrange multibillion-dollar deals overseas for Lippo Group.

Commerce officials also made it nearly impossible for reporters to read large parts of Huang’s appointment calendar and telephone message logs that were released in mid-October under the Freedom of Information Act. The documents, which revealed that Huang frequently met and spoke with Lippo officials and generous Democratic donors while serving in his government job, were illegible. It was not until journalists inspected the original documents that officials provided clear copies.

One Commerce official familiar with the copying process commented: “Does it look suspicious? Could be. But there was no nefarious activity here at all, I promise you.”

When the House Committee on International Relations requested government logs of Huang’s long-distance telephone calls at Commerce, department officials gave their assurances in writing that the data would be gathered and made available as quickly as possible. But the records were not released until the week after the election--and three weeks after records show they were printed out by the department.

The Commerce Department stopped providing information about Huang’s activities last month when the agency began referring questions about his government activities to its inspector general.

The White House, meanwhile, recently hired a new deputy counsel, Lanny J. Davis, to formulate responses to the foreign money story. Davis said he accepted the job only after receiving assurances that the White House would make public all information.

“My job is to get all the facts out as quickly and as efficiency as possible,” Davis said. “And that is consistent with what the president wants.”