-Caveat Lector-
November 10, 1999 --Wall Street Journal
Huang's FBI Debriefing Shows
Election Fraud, but No Conspiracy
By GLENN R. SIMPSON
Staff Reporter of THE WALL STREET JOURNAL
WASHINGTON -- It has been three years since John
Huang emerged as the central figure in the political
fund-raising scandal involving more than $1 million in
illegal foreign contributions to the Democratic Party.
Yet despite massive and costly
investigations by Congress and the
Justice Department, the consequences
of that scandal have been strikingly
small. A few junior Democratic
fund-raisers have entered guilty pleas,
but none have gone to jail. Meanwhile,
no charges have been brought, and
none seem likely to be brought, against
any major political figures. And while
initial revelations about possible
Chinese government involvement in the affair
undermined U.S.-China relations, the two governments
are now pursuing a new trade agreement.
Mr. Huang himself struck a deal with the Justice
Department, agreeing to tell all in return for a lenient
sentence and a limited admission of fraud. His
debriefing by the Federal Bureau of Investigation, made
public last week, provides a coda of sorts to the
unsavory three-year affair.
There was no grand conspiracy, Mr. Huang says, either
by the Democrats or the government of China. Yet he
portrays his own efforts to commit large-scale election
fraud, allegedly in tandem with several associates, as
deliberate and elaborate. Moreover, new information in
the Huang interviews supports the possibility that Lippo
Group of Indonesia acted as a political advocate in the
U.S. for the Chinese trade ministry.
Mr. Huang relates how Lippo Group and its
California-based Lippo Bank allegedly wired hundreds
of thousands of dollars in foreign funds into U.S.
accounts to reimburse contributors over six years. It
appears that little of the more than $1 million in
contributions linked to Lippo represented legal
donations.
With regard to his own contributions of more than
$100,000 over about seven years, Mr. Huang said he
was "taken care of" by Lippo in the form of bonuses. Mr.
Huang said he also tended to Lippo-Indonesia's
reimbursement of soft-money contributions by related
U.S. entities such as Los Angeles real-estate arm Hip
Hing Holdings and two other companies, San Jose
Holdings and Toy Co. Holdings.
Mr. Huang "speculated" that they were approved by
Lippo Chairman James Riady, the FBI said. One 1993
reimbursement request bears the handwritten notation
"ok." Mr. Huang identified the writing as that of Mr.
Riady, who has repeatedly denied violating U.S. election
law and reiterated his denial to a Wall Street Journal
reporter last week in Jakarta.
Rounding Up Contributors
After Mr. Riady allegedly promised Bill Clinton in 1992
that he would raise $1 million for the 1992 campaign,
Mr. Huang rounded up more than a dozen people who
together gave at least $250,000 to the Democratic Party.
"HUANG assumed that these people would be 'made
good' or 'taken care of' for their contributions because
HUANG himself had been 'taken care of' for his
contributions through his bonus payments," FBI agents
wrote. Mr. Huang said he arranged some of these
reimbursements himself.
Many Lippo-associated donors are described by Mr.
Huang as mere lackeys of the Riady family. He said he
didn't have to explain his contribution requests to a
Riady relative whose $250,000 check to the Democratic
National Committee through Mr. Huang triggered the
first scrutiny of his activities, because the man had "no
clue," which, the FBI thought, meant that he "was not
particularly bright."
One series of Lippo-related contributions from offshore,
mostly to state candidates in California and never
previously disclosed, was made by Mr. Huang through a
Lippo-linked Netherlands Antilles firm called B.O.T.
Corp N.A. In one tantalizing reference, the FBI says Mr.
Huang received more than $100,000 from B.O.T. in
January 1993 for what Mr. Huang believes were
expenses related to President Clinton's inauguration.
He describes only slight dealings with some of the better
known fund-raisers from 1996 now under indictment or
convicted, such as Charlie Trie and Pauline
Kanchanalak. If there was a larger conspiracy involving
these people, Mr. Huang says, it wasn't with his
knowledge.
Bank-Account Scruples
At times, Mr. Huang exhibited scruples. Amid his
elaborate campaign money frauds, he received $30,000
from Lippo that was deposited into his Hong Kong bank
account -- so that, he suspected, he wouldn't have to pay
U.S. taxes on it. He was nonetheless careful to report it
to the Internal Revenue Service. After his activities
became an object of intense law-enforcement interest,
Mr. Huang alleges he received "gifts" from the Riady
family of $18,000 in 1997 and $20,000 in 1998.
The FBI also questioned Mr. Huang extensively about
whether Lippo fronted in the U.S. for
Chinese-government interests because of business ties
between the company and government-controlled China
Resources Corp., long a subject of interest for
investigators.
In 1985, the FBI interrogation record says, China
Resources allegedly paid for a Lippo-organized trip to
Asia by then-Arkansas Gov. Clinton. In 1992 and 1993,
according to the FBI, China Resources bought a large
number of shares in Lippo-controlled Hong Kong
Chinese Bank, for about 80% of equity. And a China
Resources purchase of shares in Lippo itself, Mr. Huang
said, saved Lippo from bankruptcy during a real-estate
downturn.
The FBI says Mr. Huang called that deal an explicit
agreement for favors from Lippo, but "Huang did not
know what the 'quid pro quo' was for having China
Resources as a partner." The FBI says, though, that
China Resources was controlled by the Ministry of
Foreign Trade and Economic Cooperation, the primary
lobbying agent for most-favored-nation trade status for
China.
During the 1992 presidential campaign, Mr. Clinton
signaled he might revoke the trade preference to punish
the "butchers of Beijing." After the election, in 1993, Mr.
Riady personally lobbied Mr. Clinton to renew China's
MFN status, which Mr. Clinton did with conditions.
Mr. Huang himself was very active in lobbying for MFN
renewal in early 1994 before he joined the Commerce
Department to work on Asian trade issues. While he
claimed to have done so for his own reasons, he
acknowledged that Lippo financed a trip he took to
Beijing for meetings on the subject, as well as his
membership in a pro-MFN lobbying group called the
Committee of 100.
After first denying it, Mr. Huang also reluctantly
acknowledged receiving faxes around that time from the
Committee of 100 regarding news accounts and a Senate
report on Chinese espionage activities. Asked by his
interrogators whether this wasn't odd behavior for
someone about to become an employee of the U.S.
government, Mr. Huang replied, "I wouldn't blame you
for feeling it was odd. I have no explanation."
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Kadosh, Kadosh, Kadosh, YHVH, TZEVAOT
FROM THE DESK OF: <[EMAIL PROTECTED]>
*Mike Spitzer* <[EMAIL PROTECTED]>
~~~~~~~~ <[EMAIL PROTECTED]>
The Best Way To Destroy Enemies Is To Change Them To Friends
Shalom, A Salaam Aleikum, and to all, A Good Day.
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