2 Donors to Democrats Linked to Asian Funds

Two California entrepreneurs received a total of $650,000 in separate wire transfers from banks in China and Japan within days of making substantial donations to the Democratic Party, financial records released Thursday by a Senate committee show.

Both of the controversial donors--Johnny Chien Chuen Chung of Torrance and Yogesh K. Gandhi of Walnut Creek--succeeded in capitalizing on their political largess by arranging private sessions with President Clinton for groups of Asian businessmen.

The money transfers from the Bank of China in Beijing and Citibank of Japan in Tokyo support suspicions of a significant influx of improper cash into the coffers of the Democratic National Committee during the 1996 campaign, said Republican lawmakers on the Senate Governmental Affairs Committee, which began hearings this week on the flow of foreign-linked contributions into the U.S. political system and other suspected fund-raising abuses.

“Now there is a solid connection between a Chinese source of money and a Democratic Party donation,” said one committee member, Sen. Arlen Specter (R-Pa.).

The panel’s chairman, Sen. Fred Thompson (R-Tenn.), declared at the start of the hearings on Tuesday that high-level Chinese government officials sought to “subvert” the American election process by illegally funneling money into U.S. campaigns.

While the new disclosures did not reveal whether foreign government officials were behind the transfers, the documents produced the committee’s first indications that large donations to the DNC to help reelect the president may have moved from overseas accounts.

Committee aides suggested that more examples of the apparent involvement of foreign money in the campaign will follow in coming weeks.

Other significant revelations from Thursday’s hearings included:

* Vice President Al Gore’s schedule for April 29 of last year indicates that “150-200” people were expected to pay between $1,000 and $5,000 to attend a DNC luncheon at the Hsi Lai Buddhist Temple in Hacienda Heights. A spokesman for Gore, who previously denied knowing the event was a fund-raiser, said the schedule was a draft and the vice president never saw it.

* Clinton, his aides and acquaintances urged top DNC officials on at least 16 occasions to hire John Huang, the Glendale man who is now a central figure in the campaign finance probe, before he became a full-time party fund-raiser in December 1995, according to a committee document. Seven of the contacts were made by C. Joseph Giroir, a former member of the same Little Rock, Ark., law firm as First Lady Hillary Rodham Clinton. At the time he pushed for Huang’s hiring at the DNC, Giroir was working on behalf of Huang’s former employer, the Indonesia-based Lippo Group.

* When Huang was hired at the DNC, he negotiated a $60,000 salary along with a $60,000 bonus based on his fund-raising performance. Despite questions about the legality of Huang’s fund-raising that have surfaced, he recently asked the DNC for the bonus payment to help with his mounting legal bills. The DNC, which has returned $1.6 million of the $3.4 million that Huang solicited, denied his request.

* A confidential 1996 financial disclosure statement shows that Yah Lin “Charlie” Trie and his wife reported annual earnings of $101,000. Trie, a former Little Rock restaurateur and friend of the president’s, has donated $202,000 to the DNC along with his wife, and solicited more than $1 million for the Democratic Party and the Clinton legal defense fund. All of the money has been returned among suspicions that it was either improper or laundered.

“It doesn’t make sense this guy was giving his own money, does it?” Sen. Thad Cochran (R-Miss.) asked at the hearing.

* Huang’s offer to testify at the Senate hearings in exchange for limited immunity appeared to be falling apart. Huang’s attorney, Ty Cobb, said he is “becoming discouraged” but is scheduled to meet with committee lawyers today. Atty. Gen. Janet Reno has expressed her initial opposition, and senators from both parties said they were skeptical an arrangement could be worked out.

Similarly, both Chung and Gandhi, as of now, are unlikely to testify before the Senate committee without a grant of immunity, according to their lawyers. They also are under investigation by the Justice Department.

Money From China Said to Be for Business

Chung’s lawyer, Brian Sun, said Thursday that the money transferred from China into his client’s account was for legitimate business purposes and had nothing to do with his campaign contributions, which he made with his own money. Peter Coleridge, an attorney for Gandhi, said that his client “denies that he has violated any federal campaign laws.”

The DNC returned Gandhi’s $325,000 donation last November because he failed to prove that it was his own money; similarly, the DNC returned Chung’s $366,000 in recent months because he did not provide sufficient information during an internal audit. The Times first raised questions about Gandhi and Chung and the sources of their contributions last fall.

As the Senate hearings entered their third day, Republicans were under increasing pressure to produce information that supported Thompson’s sweeping assertions that high-level Chinese government officials had “crafted a plan to increase China’s influence over the U.S. political process.”

The opening witness of the hearings, former DNC Finance Director Richard Sullivan, testified that he had “never--and I emphasize, never” encountered any evidence of illegal foreign contributions.

But GOP senators made the two intriguing disclosures on Thursday.

They revealed that Chung, a struggling fax machine dealer, received a $150,000 transfer into his California Federal Bank account in Cerritos on March 6, 1995, from the account of the Haomen Group, a Chinese beer company. At the time, Chung had only $9,000 in his account, committee sources said.

On March 9--three days later--Chung showed up at the White House to hand-deliver a $50,000 check to Maggie Williams, chief of staff to the first lady.

On March 11, Chung escorted a group of five Chinese businessmen into the Oval Office to watch Clinton deliver his weekly radio address. The encounter was arranged at the last minute by the DNC; Clinton later expressed misgivings about providing the group with a photograph with him.

In December of 1994, Chung had introduced the chairman of Haomen to President and Mrs. Clinton at a formal White House Christmas party. Two days earlier, Chung had escorted the Haomen official to the exclusive White House dining room for lunch before dropping by the offices of Mrs. Clinton and Gore.

In all, Chung donated a total of $366,000 to the DNC and was rewarded with at least 49 visits to the White House to see the president, first lady and other top officials despite strong warnings from national security officials who cautioned that he should be treated with “suspicion.”

“My impression is he’s a hustler and appears to be involved in setting up some kind of consulting operation that will thrive by bringing Chinese entrepreneurs into town for exposure to high-level U.S. officials,” wrote Robert L. Suettinger, a National Security Council expert on Asian affairs, in April 1995.

Sun, Chung’s lawyer, said that the $150,000 from Haomen “came in to set up two companies to promote this beer maker’s product in the United States. There was no political aspect to it whatsoever.”

Sun said the Chinese delegation that Chung brought to the radio address in March was unrelated to his dealings with the Haomen company.

Plan to Present Gandhi Bust

In the other revelation, Sen. Susan Collins (R-Maine) noted that Gandhi, the great-grandnephew of Mohandas K. Gandhi, had failed in early 1996 to persuade White House officials to let him present a peace award to Clinton. But later Gandhi successfully arranged to present a bust of the famous world figure at a Washington fund-raiser by donating $325,000 to the DNC on May 13 of last year.

Gandhi told the Senate committee in an interview that he gave the $325,000 check to Trie and “asked him to hold it 10 days so he could cover his account,” a committee investigator said.

Within 10 days, a pair of $250,000 wire transfers were credited to Gandhi’s checking account through Citibank of Japan by Yoshio Tanaka, a wealthy 64-year-old semi-retired Japanese importer of health care products to the Far East.

Gandhi said in an interview with the committee that the $325,000 was his, but has offered three different accounts of how he acquired the money. Last year, Gandhi faced a claim of $10,000 in back taxes from the state of California and two judgments for unpaid bills.

Times staff writers William C. Rempel in Los Angeles and Marc Lacey and Mark Gladstone and researcher Janet Lundblad in Washington contributed to this story.

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The Money Trail

Yogesh K. Gandhi received a pair of $250,000 bank transfers from a business associate in Tokyo within 10 days after Gandhi contributed $325,000 to the DNC. The transactions show a solid connection between foreign money and a Democratic Party donation, Republicans say.

1. Check to DNC written on day of Clinton dinner.

2. Bank transfer to Gandhi’s account

3. Gandhi and the associate then arranged for Japanese spiritualist Hogen Fukunaga, left, to present President Clinton with a bust of Mohandas K. Gandhi at a DNC fundraiser.

Sources: Democratic National Committee and Senate Governmental Affairs Committee documents