Controversial Donor Defends His Actions

In a private meeting with House lawmakers Friday, Southern California businessman Johnny Chien Chuen Chung offered a vigorous defense of his fund-raising practices, insisting that the hundreds of thousands of dollars he contributed to the Democratic Party was his own and did not come from the Chinese government.

In a closed-door, off-the-record session arranged at Chung’s request, the Democratic donor asserted his 5th Amendment right against self-incrimination, refusing to answer questions under oath. But Chung and his attorney, Brian A. Sun, gave several hours of unofficial remarks before members of the House Government Reform and Oversight Committee, with Sun doing much of the talking, according to participants in the session.

When Chung emerged from the hearing room, he was swarmed by television camera crews eager for a glimpse of one of the first major figures in the campaign fund-raising controversy to come to Washington to speak.

Chung contributed $366,000 to the Democratic Party, all of which has been returned because of questions about whether the money originated overseas. A Torrance entrepreneur, Chung used his access to various politicians--he visited the White House about 50 times--to hype his business ventures. His dealings with former Energy Secretary Hazel O’Leary and Margaret Williams, First Lady Hillary Rodham Clinton’s former chief of staff, are now under review by congressional and Justice Department investigators.

While lawmakers said they could not disclose details of Chung’s remarks, they clashed on the significance of his much-anticipated visit to Capitol Hill.

“He asserted his 5th Amendment rights, but at the same time he wanted to be as helpful as possible in giving us information that he thought would be useful to us,” said Rep. Dan Burton (R-Ind.), chairman of the investigative committee. “We did get some information that we think would be helpful in leading us on down the path toward resolving our investigation, and we will pursue those leads.”

But Rep. Henry A. Waxman (D-Los Angeles), portraying the subpoena of Chung as a publicity stunt, said he did not hear anything new. He noted that Chung already had spoken privately to investigators for the Justice Department and the Senate Governmental Affairs Committee, which are conducting separate fund-raising inquiries.

By speaking with House investigators, Chung appeared to be jockeying for legal immunity that would shield him from prosecution in exchange for public testimony about his dealings.

Republican investigators had different goals. By getting an interview with Chung, even one out of public view, they sought to give a boost to an investigation that so far has failed to make any major revelations or capture much public attention.

Meanwhile, Burton angrily denounced Atty. Gen. Janet Reno and FBI Director Louis J. Freeh for not promptly informing Congress about newly unearthed information suggesting Chinese government efforts to influence U.S. elections.

A Justice Department official said the FBI offered three times in recent days to brief Burton’s committee about the new data--described as “raw, uncorroborated intelligence”--but was rebuffed because committee aides said they were too busy preparing for hearings.

“Bull! Bull!” Burton responded, vowing to call both Reno and Freeh to Capitol Hill.

Burton said the first he heard about the new FBI information was Thursday night when Freeh called to inform him of a Washington Post report on Friday. “I think I used one word of profanity,” Burton said of his reaction to Freeh. “I was very upset.”

Waxman, however, said it was too early to criticize the Justice Department or draw conclusions about the new information. “Let’s get the facts, then reach our conclusions.”

Senators have been told by the FBI that the newly discovered information indicates that Maria Hsia, an Arcadia immigration consultant and Democratic fund-raiser, may have been an agent of the Chinese government. A source familiar with the investigations cautioned that the term “agent” could refer to activity as innocuous as lobbying.

The information about Hsia, a Taiwanese American, referred to her activities in the early 1990s. It predated the 1995-96 election campaign and was not linked to Hsia’s role as a Democratic fund-raiser or her efforts to orchestrate a controversial Democratic Party fund-raising event at the Hsi Lai Buddhist Temple in Hacienda Heights in April 1996 that featured Vice President Al Gore. It referred to her activities in the early 1990s.

Hsia has traveled frequently to China in recent years in connection with her immigration-consulting business. Since 1991, she increasingly has shifted her focus from Taiwan to China.

Nancy Luque, Hsia’s attorney, said Friday: “I absolutely reject the suggestion that Maria Hsia did ‘the bidding of Beijing,’ and I do so without fear of contradiction. I wish the FBI had come to me or my client with their concerns before disseminating such unreliable, unbelievable and harmful information.”

In the spring of 1991, Hsia apparently considered expanding her immigration consulting business to include representation of various foreign governments, including China. But Luque said Hsia never implemented the lobbying plan.

Times staff writers Ronald J. Ostrow in Washington and William C. Rempel in Los Angeles contributed to this story.