Roots of a Scandal

...It's like throwing paint at the wall and getting the Mona Lisa," says one...

...Two went to the Democratic Senatorial Campaign Committee, and one each went to the Ohio party, the Michigan party, and the Missouri party...

...Recent developments in the campaign finance investigation have centered, as they have for more than a year now, on Attorney General Janet Reno's refusal to call for an independent counsel in the case, against the recommendation of her top deputies...

...Finally, the probe just isn't receiving much attention...

...Others in the party have acted more decisively...

...Despite Ong's personal interest in the 1992 race, Zaccaro says it is possible his client also relied on advice from his friend John Huang, with whom Ong had served on the Lippo board...

...To the investigators, it does not make sense that this could have been a random occurrence...

...According to sources familiar with the interview, Ong said he did not recall making any contributions to the Democratic Senatorial Campaign Committee or to any state parties...

...Investigators have discovered that a wave of Lippo-related money flowed into the Clinton campaign in the weeks following the car ride with Riady...

...Joseph Chiang, head of Lippo's China Consortium, gave $1o,000 to the DNC on September 28 and another $1o,000 on October 7. Chiang's wife Donna contributed the same amounts on the same days, for a total contribution of $20,000 each...

...Potter says the authors of the law intended to grant contribution rights only to those non-citizens who live in the U.S., earn their money in the U.S., pay U.S...

...CITIZEN JAMES According to investigators familiar with the case, the first Lippo contributions to the Clinton campaign and the Democratic Party coincided precisely with the Clinton/Riady car ride...

...It specifically points out that Riady flew to Los Angeles from Indonesia, "where he is now based," indicating that he was not living in the United States...

...According to the Thompson report, the president was so shaken and threatened by the takeover that he embarked upon a reckless program of fundraising without regard for the campaign finance laws...

...2 Some of these figures later emerged as major contributors during the 1996 Clinton campaign...

...For that matter, the party has not returned any of the contributions made by John Huang himself...

...One figure to emerge from the probe is a man named Bie Chuan Ong, a former member of the Lippo board of directors who, according to Federal Election Commission records, lives in Palos Verdes Estates, California...

...Joseph Sund, another Lippo executive, gave $1o,000 to the DNC on September 28...

...In all, the Riadys gave $65o,000, beginning the day before the car ride, with Hip Hing Holdings contributing another $50,000...

...If you and I were friends, I wouldn't think twice to use money to change your mind...

...On the same day, Lucy Jao Ong gave identical $5,000 contributions to the Michigan party and the DSCC...

...To understand the 1996 Clinton fundraising scandal, investigators now believe, one must first understand the 1992 Clinton fundraising scandal...

...At the same time, California Democratic Senator Dianne Feinstein returned donations from Sund and from Felix and Mary Ma...

...a tributions during the first Clinton campaign...

...I'm sure there was some coordination," Zaccaro says...

...At this point, investigators are subpoenaing bank records, interviewing witnesses, and hying to piece together a schematic of those contributions...

...o reporters covering the presidential campaign of Arkansas Governor Bill Clinton, August 1.4,1992, looked like just another day on the road...

...In a perceptive analysis written last year for the New York Times, reporter Sheryl WuDunn noted that Asian businessmen, accustomed to bribery as a part of life, looked on the American campaign finance scandal not with outrage but with surprise at how cheaply American politicians could be bought...

...Finally, on November 20, after Clinton's election, Riady gave $100,00o to the Presidential Inaugural Committee...

...The American Spectator • October 1998 31 The amount and timing of the contributions suggest that someone was coordinating the operation...

...ONO'S EXCELLENT POLITICAL ADVENTURE In addition to raising new doubts about previously known contributions, investigators are also analyzing heretofore overlooked Lippo-related donations to the 1992 Clinton campaign...

...Now Reno has cracked the door ever so slightly, going forward with a 9o-day preliminary investigation into whether Vice President Al Gore lied to investigators who questioned him about fundraising calls he made from his White House office...

...This is primarily a courtesy call...

...On October 27, she gave $5,000 to the Michigan party, and on the next day she gave $5,000 to the Ohio party, for a husband-and-wife total of $40,000...

...They happen to have Asian names and have an association with Lippo Bank and have been pulled into a highly partisan investigation...

...Rather, a look at the emerging evidence suggests it is more accurate to say that, looking for quick campaign cash, they simply went back to the well that had produced (at minimum) hundreds of thousands of dollars in questionable con2 The American Spectator • October 1998 29 The DNC is not terribly curious about the money...

...According to the accepted version of events, it was at this meeting that the president assembled the team that would later implement the illegal fundraising scheme...

...But the car ride memo seems to cast new doubt on the legality of those contributions...

...light of the known campaign violations of Huang— makes investigators believe that someone was orchestrating an illegal contribution scheme to benefit the '92 Clinton campaign...

...What investigators are now learning is that Chiang's employers at Lippo were working on Bill Clinton's mind far earlier than we ever knew...

...Zaccaro concedes that making contributions is "not something that [Ong] has done a lot," but says Ong became keenly interested in politics during the first Clinton campaign...

...For one, there is the problem of scanty documentation...

...Beyond that, there is the much more serious question of whether Riady contributed his own money...

...Last June, the Associated Press reported federal investigators have found evidence that a large sum of money—well over $300,000—was transferred from Lippo sources into Riady's personal accounts around the time of his contributions...

...Hip Hing was owned by James Riady and controlled by John Huang...

...The fact that the donations of Ong, Yeh, Ma, Chiang, Sund, and daSilveira add up to precisely $2o0,000 suggests that the contributions might have been guided by some central supervisor...

...In March 1997, Starr subpoenaed Yeh in an effort to determine Lippo's role in the payment of hundreds of thousands of dollars to Clinton confidant Webster Hubbell at a time when Hubbell was not fully cooperating with Starr...

...Indeed, it appears that the new information alters what has long been the conventional wisdom of the campaign finance scandal...

...Also on October 23, Ma's wife Mary gave $5,000 to the DSCC...

...his wife contributed another $100,0oo...

...He will be giving $1oo,00o to this event and has the potential to give much more...

...Instead, it appears that campaign officials read the law—if indeed they did read the law—to say that possessing a green card is qualification enough to give...

...The candidate was in San Gabriel, California, a middle-class suburb north of Los Angeles...

...But it now appears that Bill Clinton and top political aides did not come up with a new plan in 1995...

...The brief drive, the memo made clear, was a very big deal for Riady: He has flown all the way from Indonesia, where he is now based, to attend the fundraiser...

...And it might, perhaps, further underscore the gravity of the case...

...Contributions above $20,000 are routinely applied to "soft money" accounts, which cannot be spent directly on individual campaigns but can be used for so-called party-building activities...

...Under such a definition, Riady would not have been permitted to contribute...

...Second, Thompson and many in the press pointed to a September 13, 1995 meeting at the White House in which the president personally directed that fundraiser John Huang—the former Lippo official with close ties to Riady—be placed inside the Democratic National Committee...

...In addition, just about everyone involved in the case is not available to be interviewed by congressional investigators...

...What's more, the car ride memo suggests Clinton campaign officials knew that Riady did not live in the United States, which Potter says should have set off warning signals...

...On October 21, he gave $5,000 to the Arkansas party, and on the 23rd, he gave $5,000 to the Michigan party, for a total maximum allowable hard money contribution of $20,000...

...According to a spokesman, the party has not returned any of the contributions from the people mentioned in this article...

...Altogether, the Ongs gave $2o,000 each, the maximum they were allowed to contribute under hard money rules...

...For example, in March 1997, House Minority Leader Richard Gephardt returned $21,000 in Lippo-related contributions—among them donations from David Yeh and Joseph Sund...

...They also suspect that at least some of those contributions fit the pattern of illegal conduit contributions—straw donors—that later characterized the 1996 Clinton fundraising operation...

...by Kenneth R. Timmerman, TAS, August 1997...

...On October 12, he gave $75,000 to the Louisiana Democratic Party...

...First was the Republican congressional victory of 1994...

...It raises a good policy issue for the future...

...It's likely that [Huang] may have said to some of his friends, `I think you should contribute to these particular causes.' Zaccaro attributes the current investigative interest in Ong's contributions to the political hostilities now going on in Washington—and to a widespread bias against Asians...

...On October 15, he gave $5o,000 to the North Carolina Democratic Party...

...Ricor daSilveira, executive director of Lippo Asia, gave $5,000 to the Arkansas party, $5,000 to the Michigan party, and $5,000 to the DSCC, while his wife Brenda gave another $5,000 to the DSCC, all on October 27.2 What interests investigators is the amount and the timing of the contributions...

...The practice is entwined with building relationships and doing business, and the amounts are usually far greater than the sums that have sparked uproar in Washington...

...Most observers have accepted the conclusions of Senator Fred Thompson's campaign fundraising report, which traced the origin of the scandalto two events...

...In an interview with TAS, party spokesman Rick Hess said that in 1992 James Riady was a "legal permanent resident" and thus entitled to contribute...

...Oval Office Meeting Set DNC Asian Funds Network in Motion," was the Washington Post headline that reported details of the meeting...

...It's like throwing paint at the wall and getting the Mona Lisa," one says...

...Riady and Huang, of course, are the two most prominent members of the "pled and fled" club—that is, those campaign finance figures who have either taken the Fifth Amendment or left the country to avoid answering questions about their contributions...

...On October 8, he gave $8o,000 to the Arkansas Democratic Party (his wife pitched in another $5,000...

...In addition, David and Christina Yeh are believed to be out of the country, as are Felix and Mary Ma, Joseph Chiang, Joseph Sund, and Ricor daSilveira...

...Nineteen ninety-two was a heavily contested election," Zaccaro says, "and a lot of people became active in supporting candidates...

...James Riady, owner of Lippo Bank, will greet BC at elevator," reads a note on the candidate's daily itinerary, referring to the Indonesian billionaire now at the center of the campaign finance investigation...

...Investigators do not suspect any misconduct on the part of the DNC —the forms might have been routinely thrown out—but not having them makes tracking bank accounts and movements of money much more tedious and time-consuming...

...He will talk to you about banking issues and international business...

...But in October of that year, Ong and his wife, Lucy Jao Ong, made a series of contributions that have now come under intense scrutiny by campaign finance investigators...

...low point of the Clinton presidency" was the description of New York Times columnist William Safire...

...Such a reading might be a sufficient pretext to declare the contributions legal, but some experts believe it runs counter to the law's intent "I don't think it occurred to anybody in drafting the election laws that someone who was qualified for permanent residency and had a green card might not be a permanent resident," Potter says...

...Riady has refused to answer questions about the issue...

...After the event, according to a memo written by campaign aide Melinda Yee, Riady was scheduled to accompany Clinton during a five-minute car ride to his next stop, a meeting of small business owners...

...Af 32 October r 9 9 8 • The American Spectator...

...When investigators later asked Ong to give an under-oath deposition, he asserted his Fifth Amendment right and declined to testify...

...A few days after the contribution, Huang sent a now-famous memo to Lippo headquarters in which he asked the company to "please kindly wire" $5o,000 to Hip Hing Holdings as reimbursement for the DNC contribution...

...Two days later, Ong gave $5,000 to the Michigan party and another $5,000 to the Democratic Senatorial Campaign Committee (DSCC...

...See "Where Has All The Money Gone...

...Under the law, contributors are allowed to give up to $20,000 in hard money, which party officials can use for anything they want...

...THE PLED AND FLED CLUB Despite its importance, the investigation is progressing slowly, hampered by several factors...

...There is no evidence that Ong made any political contributions before or after 1992...

...He started the morning with a conference call to top strategist George Stephanopoulos in Little Rock, followed by an hour taping a campaign commercial...

...taxes, and share the common concerns of American citizens...

...BYRON YORK is an investigative writer with TAS...

...The same day, Riady's wife Aileen also gave $15,000 to the DNC and $5,000 to the California party...

...According to spokesman Rick Hess, the DNC has not returned any of the contributions from the people mentioned in this article, apart from the $50,000 Hip Hing Holdings contribution...

...It's a shame so many Asian-Americans have been pulled into this situation," Zaccaro says...

...The effect of her stand is to focus attention on a tiny (although significant) portion of a much larger story, while the rest of the investigation proceeds in a near-vacuum...

...In an interview with TAS, Ong's lawyer, Thomas Zaccaro of the Los Angeles firm Manatt, Phelps & Phillips, said Ong is an American citizen and that the money Ong contributed to the Democratic Party "was his money to give, as far as I know...

...Former Federal Election Commission chairman Trevor Potter told TAS that "in common campaign parlance, it has been understood that the only people who can give are U.S...

...This is what they know so far: •David Yeh, a top executive at Lippo Realty, wrote two $5,000 checks to the DNC on September 29, 1992, and another two $5,000 checks to the party on October 7. Yeh's wife Christina did the same thing: two $5,000 checks on September 29, and another two on October 7. Their contributions totaled $20,000 each, the maximum allowable under hard money rules.1 •Felix Ma, a director of Lippo and also executive director of the Tati group, a Lippo subsidiary, wrote five $5,000 checks on October 23...

...To the investigators, it could not have been a coincidence...

...On September 3o, Riady initiated an extraordinary series of soft money contributions...

...The same day, Aileen Riady gave $50,000 to the Georgia Democratic Party...

...Investigators questioned Ong about the contributions during an interview in September 1997...

...Relationships and integrity are of utmost importance to most of the overseas Chinese businessmen," Chiang said (making no mention of his own contributions to the Clinton campaign...

...But such suspicion does not extend to the Democratic National Committee...

...When shown Federal Election Commission records documenting his contributions, sources say, Ong told investigators that the documents did not refresh his recollection...

...It appears that these contributions were unrestricted "hard money" donations...

...In December 1996, Senator Edward Kennedy returned a donation from Ma...

...On October 21, Ong gave $5,000 to the California party and $5,000 to the Arkansas party...

...citizens and foreigners permanently residing in the United States...

...On August 13, the day before the car ride, Riady made his first personal contributions of the election cycle, giving $15,000 to the DNC and $5,000 to the California Democratic Party...

...While much has been learned about the financing of the 1996 race, the new emphasis on 1992 will serve to highlight evidence that the administration was entangled with the Lippo conglomerate from its first days in office...

...His wife gave identical contributions to the same two parties the same day...

...Then, on October 5, he gave $75,000 to the Ohio Democratic Party...

...28 October r 9 98 • The American Spectator Amid all the glad-handing and schmoozing with local leaders that is standard for such events, Clinton set aside some time to meet with one particularly notable guest at Sam Woo...

...And the fact that they were all made within a very brief time period could be further evidence of an overall plan...

...Sam Woo, which can seat goo, is the largest Chinese restaurant in an area rich with Asian eateries...

...Altogether, the apparent coordination of the contributions—in Yeh is also involved in another investigation—that of Whitewater independent counsel Kenneth Starr...

...The memo, now in the hands of investigators at the House Government Reform and Oversight Committee and the Justice Department, has opened up a new vein in the two-year-old campaign finance probe...

...In an atmosphere of abject political desperation," the report concluded, "the seeds were sown which would later grow into the DNC's variegated fundraising scandals of 1996...

...30 October 1998 • The American Spectator MR...

...DAVID, FELIX, JOSEPH, JOSEPH, AND RICOR Beyond the Ong case, investigators have come across a number of other Lippo-related contributors, all of whom gave money in similar patterns in the weeks following the Clinton/Riady car ride...

...It just doesn't happen that way...

...DNC officials have told investigators they no longer have check-tracking forms from 1992...

...We felt that it was the appropriate thing to do in light of the questions that had been raised," a Kennedy spokesman said at the time...

...Still, Republican investigators go on, hoping to one day reveal the big picture of Clinton campaign fundraising...

...B Y R 0 N Y 0 R K FA DAL 1- _A TS While Janet Reno meditates en AI Gore's phone calls, congressional investigators are slowly uncovering a much bigger story: how the Clinton campaign finance scandal started far earlier than anyone knew...

...Such foreign reimbursement is clearly illegal, and DNC officials say they have returned the money...

...Those are the detailed accounts of individual contributions that have proved invaluable in the probe of 1996 fundraising...

...Corruption and gift-giving to curry favor are widespread in most Asian countries," WuDunn wrote...

...The article went on to quote Joseph Chiang—remember him?—who told WuDunn that the exchange of money is what makes his world go 'round...

...Then he headed off to a fundraising lunch at the Sam Woo Seafood Restaurant on West Valley Boulevard...

...It just doesn't happen that way...

...First he sent $75,000 to the Michigan Democratic Party...

...On August 12, 1992, two days before the ride, a Lippo subsidiary called Hip Hing Holdings made a $50,000 contribution to the DNC Victory Fund...

...For that matter, the DNC has never returned any of the contributions made by John Huang himself...

...Apart from the Hip Hing money, the Democratic National Committee has maintained that the rest of the donations were allowable under the election laws because Riady reportedly possesses a green card, indicating that, while not a citizen, he is a permanent resident of the United States...