; 2nd Session
Senate Report 105-167 Part 2
105 S. Rpt. 167; Prt. 2
INVESTIGATION OF ILLEGAL OR IMPROPER ACTIVITIES IN CONNECTION WITH 1996 FEDEELECTION CAMPAIGNS
DATE: Ordered to be printed March 10, 1998
SPONSOR: Mr. Thompson submitted the following report
COMMITTEE: from the Committee on Governmental Affairs
THE HSI LAI TEMPLE FUNDRAISER AND MARIA HSIA
The fundraiser attended by Vice President Gore on April 29, 1996 at the Hsi Lai Temple in Hacienda Heights, California, has been the focus of considerable attention and controversy ever since reports first surfaced in the national press revealing that some of the donations given to the DNC in connection with this event were unlawfully reimbursed. (note - 1) Over the course of its investigation, the Committee has examined the various allegations of illegality and impropriety that have surfaced in connection with this event. Furthermore, the Committee has conducted a broader inquiry into the unlawful involvement of the Hsi Lai Temple in the 1995-96 election cycle and the complex chain of events that produced this involvement.
1 See, e.g., Phil Kuntz, ''Instant Karma: Cash Gets to Democrats Via Buddhist Temple,'' Wall Street Journal, Oct. 17, 1996 (recounting allegations by Buddhist nun that DNC donation for Gore event was reimbursed). This early coverage prompted the Christian Coalition to file a complaint against the DNC with the Federal Election Commission in connection with the Hsi Lai Temple fundraiser. See generally Colleen Sealander, letter to Master Shing Yun, Oct. 29, 1996 (Ex. 1) (forwarding complaint to Temple, with attachments).
As a result of these inquiries, it has become apparent that the DNC's Hsi Lai Temple fundraiser on April 29, 1996 was merely one instance--albeit the most significant one--in an ongoing campaign of illegal Temple donation-laundering arranged by a woman named Maria L. Hsia in support of Democratic candidates. Nor was this campaign merely an aberration confined to the 1995 96 election cycle. Rather, it had roots stretching back to 1988, with the decision of James Riady, John Huang, Maria Hsia, and others to organize themselves into a political fundraising and lobbying organization in order to advance their interests through U.S. politics.
The Temple-related issue that has hitherto received the most attention in the press--Vice President Gore's knowledge (or alleged lack thereof) with regard to the status of his April 29 luncheon as a DNC fundraiser--is addressed in this section. It will be obvious from the evidence recounted herein that despite his various denials, the Vice President was well aware that the event was one designed to raise money for his party. Preoccupied by a narrow debate over the inconsequential terminology of ''community outreach,'' ''finance-related events,'' ''donor maintenance,'' and ''fundraisers,'' many observers have missed the forest for the trees. The real significance of the Temple incident lies not in the Vice President's lack of candor, but in the ongoing relationship this affair illustrates between him--and the Democratic Party--and a small but influential political clique headed by Riady, Huang, and Hsia.
As will become clear, despite the participation of Temple monastics in criminal wrongdoing in connection with the April 1996 event and in Hsia's broader campaign of Democratic Party donation-laundering, the Temple itself seems to have been only a secondary actor in this drama. Indeed, Temple officials seem to have known little--if anything--about the political campaigns they illegally supported at Hsia's direction. (note - 2)The real significance of the Temple incident may therefore be found in what it reveals about the activities and agenda of its key decision-makers--Maria Hsia and John Huang.
2Since the Hsi Lai Temple received electronic alarm services from a corporation called ''DNC,'' many of the monastics solicited to give money to the Democratic National Committee may have mistaken the party for the company. Cf., e.g., IBPS check #1278, Jan. 5, 1996 (Ex. 2) ($50 payment to ''DNC,'' apparently for alarm services).
Hsia and Huang have both asserted their Fifth Amendment privilege against self-incrimination and have refused to cooperate with the Committee. Nevertheless, from documentary evidence produced pursuant to subpoena and from interviews and depositions of persons involved, the Committee has been able to develop a detailed understanding both of the events at issue and of the role of Hsia and Huang therein. i. maria hsia
Hsia Ling--better known by the Anglicized version of her name, Maria Lynn Hsia--was born in 1951 and first came to the United States on a student visa in 1973. After returning briefly to her native Taiwan in 1974, she returned to this country to become a permanent resident in 1975. Not long after her arrival, she began working as a case worker at Popkin & Shamir, a personal injury and immigration law firm. (note - 3) She became a U.S. citizen in 1986. (note - 4)
3Maria Hsia, hearing transcript from Hsia v. Hom, Ca. Super. Ct., No. BC 059523, Aug. 16, 1995, pp. 16-17 (Ex. 3).
4James Sterngold, ''Political Tangle of Taiwan Immigrant,'' New York Times, June 9, 1997.
Though not a lawyer, Hsia took up several successive positions with various immigration law firms, leaving Popkin for a firm headed by Patrick Fleming, working as a consultant for Damrell, Damrell & Nelson, then joining Howard Hom & Associates, and working with Arnold Malter, before going into business under her own name as Hsia & Associates in 1991. (note - 5) Throughout this period, the immigration services business generally treated Maria Hsia well. In the late 1970s and early 1980s, providing immigration services to Taiwanese citizens was an ''extremely lucrative'' field. (note - 6) Hsia, it appears, profited accordingly. Her reported income in 1982, for example, was $637,000. (note - 7)
5Hsia's involvement with former INS lawyer Howard Hom began in the summer of 1979, when they were both enrolled in Cantonese language classes at the University of California in Los Angeles. Deposition of Howard Hom, Aug. 27, 1997, pp. 8 9. They began living together in 1980, and when the Fleming firm split up in 1986, Hom went into business with Hsia as they took over most of Fleming's immigration clients. See Memorandum of Interview of Howard Hom, Aug. 10, 1997, p.1. This personal-cum-business relationship with Howard Hom lasted until late 1990. Howard Hom deposition, p.9.
6 See Trial Brief of Defendant and Cross-Complainant Howard Hom in Hsia v. Hom, Ca Super. Ct., No. BC 059523, p. 6 (Ex. 4) (describing immigration law as profitable ''largely due to tremendous uncertainty in Taiwan over the future of the island nation'' caused by the U.S. government's abrogation of formal diplomatic relations with Taiwan).
7Ex. 3, p. 69. Her income in 1983 was $449,000. By 1986 it had slipped to $362,000. Id. According to press reports, this stream of revenue enabled her to purchase a Rolls Royce automobile and a home in Beverly Hills. Sterngold, supra note 4.
Hsia's first contact with political fundraising came in early 1982 at a cocktail party she attended with Howard Hom. At that reception, they met briefly with March Fong-Eu, an Asian-American woman who was then California's Secretary of State, and Fong-Eu's son, Matthew Fong, who was then his mother's campaign manager and subsequently became California's state treasurer. At a subsequent meeting, Fong enlisted Hom and Hsia to help with fundraising for his mother's re-election. As Hom later recalled it, ''Maria offered to take over the fund-raising activity and, in fact, she explained to Mr. Fong that she felt that she and her friends could probably do a better fund-raiser than Howard and his lawyer friends . . . . That was the genesis of how fund-raising got started with Maria.'' (note - 8)
8Hom deposition, pp. 10 12.
It was her immigration work that helped propel Hsia into the political arena. Her interest in political activity was heavily mercenary: it provided her with contacts and friends in government circles in ways that she believed helped her immigration services business in at least two ways.
First, such contacts might be useful in helping her clients with specific immigration matters. When she and Hom ran into some difficulty with Immigration and Naturalization Services (INS) officials in 1983 over a series of visas they had obtained for clients through the U.S. consulate in American Samoa, for example, Hsia decided that ''a political approach might be useful'' to complement more conventional litigation strategies. (note - 9) Through her political contacts, she persuaded U.S. Senator Alan Cranston and U.S. Representatives Mel Levine, Howard Berman, and Harry Reid to write letters to the INS on her behalf. Cranston was already a recipient of political contributions Hsia had raised through her contacts in California's Asian community, 10 and after their help with this immigration issue Hsia began raising money for Levine, Berman, and Reid as well. (note - 11) Their queries forced the INS to undertake the unusual additional step of publishing a report in December 1983 on its handling of these particular cases. (note - 12) The message was not lost on Hsia that political contacts and political fundraising could indeed pay her concrete dividends. (note - 13)
9 Id., p. 18.
10Maria Hsia's fundraising efforts on Senator Cranston's behalf continued, in fact, at least through May 1989. See Handwritten note by Hsia's assistant Jeffrey Su listing attendees at Cranston fundraiser on May 23, 1989, including Maria Hsia and John Huang (Ex. 5). As a result of Hsia's longstanding contacts with Cranston, he invited her to address a field hearing of the Senate Foreign Relations Committee's Subcommittee on Asia and Pacific Affairs (which he chaired) at UCLA in February 1989. See Alan Cranston, letter to Maria Hsia, Jan. 23, 1989 (Ex. 6); see generally Hom deposition, pp. 180 82.
11Hom deposition, p. 20.
12Sterngold, supra note 4.
13 See generally Hom deposition, p. 15 (''[E]specially on the Federal level, when Maria started to meet Congressmen and Senators, she realized that this was helpful to my immigration clients who, because of the[ir] contact with the Federal Government, might have some need of a letter from a Senator or a Congressman to get a case moving through the red tape of the bureaucracy.'').
Apart from concrete help with specific immigration cases, however, Hsia's political activity was useful to her business in a second, more general sense: it helped her cultivate an image of a ''connected'' political ''player'' who could ''make things happen'' for her clients. As Hom put it, [I]t was also good in the sense of a public relations image where the Chinese newspapers would say, Here's Howard Hom and Maria Hsia having a reception with the particular Senator or Congressman, the implication obviously being that we were well-connected and that clients should view that, if anything happened to their case, we had this kind of extra protection, so to speak. (note - 14)
14 Id. Her political fundraising in California politics, for example--which had begun with her involvement with Hom in March Fong-Eu's campaign in 1982--quickly proved useful in this regard. With help from fundraising beneficiaries March Fong-Eu and California Lieutenant Governor Leo McCarthy, for example, Hsia was appointed to several honorary state positions, the prestige of which benefitted her immigration work. 15
15 See, e.g., Ex. 3, p. 58 (''I was sitting on the California Economic [Development] Commission, which gave me a lot of exposure and [helped] to draw more [immigrant] investors [under the Immigration Act of 1990] to come into this country.'') These state positions included seats on the Commission for Economic Development and the California-Taiwan Sister State Legislative Task Force, and received weighty titles as March Fong-Eu's ''Honorary Deputy Secretary of State'' and ''Special Assistant for Asian Affairs.'' See Maria Hsia biography, p. 2 (Ex. 7) (listing positions); Hom deposition, pp. 12 13; Leo McCarthy, letter to Maria Hsia, April 8, 1991 (Ex. 8) (discussing upcoming seminar for Commission for Economic Development).
As luck would have it, however, the synergy between Hsia's political activity and her immigration business did not flow in only one direction. Her immigration work may, in fact, have introduced her to Indonesia's Lippo Group conglomerate. Having been put in contact with the Indonesian section of Lippo Bank by one of her clients, she acquired some further clients through them. (note - 16)
16Maria L. Hsia, deposition in Hsia v. Hom, California Superior Court, No. BC 059523, May 18, 1994, pp. 29 31 (Ex. 10).
By the late 1980s, Hsia had begun to attempt on the national stage what she had by then accomplished in California: building close fundraising and political ties to prominent politicians who were in a position to help her and her friends. At least initially, however, this project--which was to culminate with her efforts to involve the Hsi Lai Temple on behalf of national Democratic candidates in the 1996 elections--could not be accomplished alone. To move more into national politics, Hsia required some new friends.
The involvement of Hsia and the Hsi Lai Temple in donation-laundering in support of the Clinton/Gore ticket in 1996 was the culmination of a relationship between Hsia and Vice President Gore that stretches back to 1988--the year that James Riady, John Huang, Maria Hsia, Eddy Yang, Howard Hom, Fred Hong, and others established the Pacific Leadership Council (PLC) as a fundraising and lobbying organization to promote their interests in U.S. politics. (note - 17)
17As Hom recalled it, the purpose was to build the group into a powerful political organization; it was designed to give its charter members ''the same kind of clout as, say, other organized groups . . . like the Teamsters or the National Rifle Association . . . .'' Hom deposition, p. 24.
From the beginning, it should be noted, the PLC was in large part a vehicle for the advancement of Lippo interests. James Riady, the son of Mochtar Riady and scion of the family dynasty that ran the Lippo Group, was instrumental in the PLC's founding and served alongside Hsia and Fred Hong as one of the organization's first co-chairs. (note - 18) Indeed, James Riady was perhaps the single most important figure in the PLC's early political activity, hosting its first political fundraiser on April 22, 1988, 19 using his business contacts to facilitate the group's fundraising, 20 and employing his own money and that of Lippo employees to make up for unanticipated shortfalls in PLC fundraising efforts. (note - 21)
19 Id. p. 26; see also Maria Hsia, facsimile transmission to John Huang, March 30, 1988 (Ex. 11) (referring to upcoming event at ''James's house on 4/22/88'').
20One document recounting contributions made to the Democratic Senatorial Campaign Committee (apparently in 1988), for example, lists 13 persons or couples who had contributed between $5,000 and $10,000 to that organization. Beside each name is listed the name of the person who solicited that contribution. James Riady's name appears next to 11 of the 13 donations, suggesting that he was responsible for every contribution but two (the ones that were made by Hsia and Hom themselves). David Lang, memorandum to Mary Leslie, May 4, 1988 (Ex. 12); see also Hom deposition, p. 28 (explaining that handwritten notations next to each name indicate solicitor). Another document produced to the Committee, recounting solicitations for new membership in the ''Leadership Circle/Business Round Table Circle,'' lists Maria Hsia and James Riady as having each solicited $55,000. List of Leadership Circle Solicitations, undated (Ex. 13).
21John Huang, Riady's employee, was particularly active in this regard. See Hom deposition, pp. 30 32 (recounting that John Huang commonly ''stepped in to fill the slot'' if Hsia or others ''would fall short of [their] goal and would have to look for other people to bail her out . . . [by] making an extra contribution''); John Huang, note to Maria Hsia, Dec. 16, 1989 (Ex. 14) (forwarding blank check drawn on account at Lippo bank with handwritten instructions to use it for either $500 or $1,000 donation to Fund for a Democratic Majority, depending upon whether another contributor met anticipated commitment); Jeff Su, letter to ''Pamela,'' April 15, 1991 (Ex. 15) (enclosing Huang check to ''Mikulski for Senate'' in order to ''serve as a replacement for Phillip So's check''); Maria Hsia, letter to Rick Weiland, April 28, 1988 (Ex. 16) (forwarding check from Huang which ''represents David Yeh and Ossy Tirta's contributions''); Ex. 13 (listing solicitations by Riady for ''New Members Leadership Circle/Business Round Table Circle'' with handwritten alterations replacing names of Ossy Tirta and David Yeh with that of John Huang). A ''wish list'' (note - 22) James Riady submitted to Hsia in April 1988 summarizing ''issues need[ing] to be followed up,'' (note - 23) for example, suggests Riady's role in steering the PLC and interest in enlisting it, and through it the Democratic Senatorial Campaign Committee (DSCC), as a vehicle for the promotion of Lippo interests. This list, prefaced by a handwritten memorandum on Bank of Trade/Lippo Group 24 stationery, outlined Riady's plans for the group's political activity in U.S. politics on a Senator-by-Senator basis, outlining a specific ''agenda'' for six U.S. Senators: Daniel Inouye, Tim Wirth, Kent Conrad, James Exon, John Melcher, and Tom Daschle. More broadly, Riady suggested a number of ''[o]ther issues'' that the PLC should pursue, among them:
22The term is Howard Hom's. See Hom deposition, p. 36.
23James Riady, memorandum to Maria Hsia, April 26, 1988, p. 1 (Ex. 17).
24The Bank of Trade was a Lippo-owned bank that is now known simply as Lippo Bank. ''(i) The need for the Senators to impress upon Taiwan to allow Asian-American banks (or at least Bank of Trade) to be allowed to open a branch office in Taiwan in the very near future. (ii) Appointments of Asian-Americans to policy making positions in the Federal Government. (iii) Visit of US Senators on an ongoing and regular basis to Indonesia, Hong Kong and Taiwan at our invitation or with us as host. (iv) Participation of Senators at specific Asian-American community activities in California such as the NACAB, The Asia Society, the Indonesian Business Society and other similar bodies. (v) Funds of various Federal Government Agencies or government bodies as well as that of DSCC to be deposited at the Asian-American banks in the U.S. Perhaps the DSCC could start by making a deposit at Bank of Trade. (vi) Assistance for special, exceptional immigration cases when and if it arises.'' (note - 25)
25Ex. 17, p. 3.
Riady's role in personally directing such activity, however, declined over time as it became difficult for him to reconcile the broader responsibilities of helping run his family's international business empire with day-to-day involvement in U.S. politics. As a consequence, he found it necessary to step down as co-chair of the PLC. To ensure that Lippo's interests were still advanced by the organization, however, Riady delegated his role to Huang, who was at that time a top executive with the Lippo-owned Bank of Trade and thus Riady's employee. Huang thereafter served as Riady's agent ''both on the PLC, taking over Riady's position as the organization's co-chair, and more generally with regard to U.S. political activity. (note - 26) As Maria Hsia herself 27 put it in a facsimile transmission to her PLC co-chair Fred Hong, ''John Huang . . . is putting D.S.C.C. together for James.'' (note - 28)
26 See Hom deposition, pp. 24 25.
27As suggested by Riady's April 1988 ''wish list,'' Hsia was apparently also expected to play a role in implementing James Riady's agenda. See Ex. 17, p. 1 (noting that with regard to political agenda, ''it may be best to coordinate through a person-- i.e., you.'').
28Maria Hsia, facsimile transmission to Fred Hong, March 30, 1988 (Ex. 18).
The PLC swung its weight in behind Democratic Party candidates in several of the major national races of 1988, most prominently Michael Dukakis' campaign for President and Leo McCarthy's campaign for the U.S. Senate. (note - 29) Both of these campaigns, however, were conspicuously unsuccessful--leading the PLC to cast around for a way to rekindle its political fortunes. Ultimately, the PLC decided to try to revive the organization's political activity by organizing a high-profile trip to Asia for a group of U.S. Senators. (note - 30) Significantly, it was this search for new political opportunities in 1988 89 that helped bring Hsia and the Riady/Huang group together, simultaneously, both with Venerable Master Hsing Yun's Fo Kuang Shan Buddhist order and with then-U.S. Senator Al Gore.
29 See generally Hom deposition, pp. 22 25, ''89 for 90,'' Los Angeles Times Magazine, Jan. 1, 1989, p. 34 (identifying Hsia as ''at the center of a predominantly Asian group of fund-raisers rapidly emerging as a major force in the hotly competitive Los Angeles political money scene. Last fall, the group raised substantial sums for, among others, the Dukakis and McCarthy campaigns. Throughout 1989, its' leading delegations of Senators and Congressmen on tours of the far east''). Hsia was also a ''regional chair'' for the 1988 Democratic Senate Dinner in Los Angeles and--along with Huang, Hom, and Fred Hong, among others--co-chaired at least one Dukakis campaign fundraising dinner in Los Angeles sponsored by the ''Asian-American Friends of Dukakis.'' (The ''general chairman'' for the latter event was the now-convicted campaign-finance violator Albert Lum.) See 1988 Democratic Senate Dinner brochure, p. 1 (Ex. 19); Dukakis dinner program (Ex. 20).
30As it turned out, this trip would be among the PLC members' most important steps toward implementing the U.S. political agenda James Riady had spelled out in April 1988, see supra text accompanying note 25 (listing agenda item of having Asian-Americans appointed to high office), until the success in 1994 of the group's efforts to have Huang appointed to a high government position. See Hom deposition, p. 39; see also Ex. 21 (letters on behalf of John Huang: Howard Hom, letter to Doris Matsui, Dec. 14, 1992; Sen. Paul Simon, letter to Susan Brophy, Jan. 6, 1993; Sen. Thomas Daschle, letter to Richard Riley, Jan. 8, 1993; Mike Wantanabe, letter to Melinda Yee, Jan. 19, 1993; Sen. Kent Conrad, letter to Bruce Lindsey, Jan. 21, 1993; Nancy H. Au, letter to Melinda Yee, Jan. 26, 1993; Kathleen Brown, letter to Jody Franklin, Jan. 28, 1993; Maeley Tom, letter to John Emerson, Feb. 17, 1993; Leo McCarthy, letter to Bruce Lindsey, Feb. 22, 1993; Leo McCarthy, letter to John Emerson, Feb. 22, 1993).
The connection between Hsia and her fellow PLC members and the Fo Kuang Shan Buddhist order 31 --the Taiwanese parent organization of the International Buddhist Progress Society (IBPS) and its Hsi Lai Temple in Hacienda Heights, California--came about through Eddy Yang. Yang, also a founding member of the PLC, headed the Sunlight Corporation a furniture company and had been for many years an ''advisor'' to the Fo Kuang Shan order in Taiwan. 32 As Howard Hom recalled, Yang stepped in and ''volunteered the temple's auspices'' after Hsia had ''problems lining up a corporate sponsor that she knew,'' making the temple available to help underwrite the cost of the PLC's trip to Asia for Senator Gore in early 1989. (note - 33)
31This Taiwanese-based sect was founded in 1969 by Li Kuo-Shen, who subsequently took the name Hsing Yun (''Stars and Clouds'') as his ''Dharma name'' upon becoming a monk. By the mid-1990s, the Order had developed into a worldwide network having some 130 temples, as many as 1.5 million adherents, and over $400 million in assets. See Kevin Sullivan, ''Monk at Issue is an Icon in Taiwan,'' Washington Post, Oct. 25, 1996, p. A22; Geoff Spencer, ''Buddhism Blossoms in Australia's Industrial Heartland.'' Ap Worldstream, Oct. 8, 1995.
32 See Hom deposition, pp. 49 50.
Involving the Fo Kuang Shan Order in the PLC's agenda was in many ways an inspired choice, as it had acquired a reputation for political activity in Taiwan. (note - 34) Master Hsing Yun saw himself as destined to play an important role on the world stage as an unofficial advisor to political leaders both in Taiwan and elsewhere. (note - 35) Not for nothing, therefore, was Master Hsing Yun known as ''the political monk.'' (note - 36)
34Master Hsing Yun, for example, has since served 1988 on the Central Advisory Committee to Taiwan's ruling Kuomintang Party (KMT), supported an independent Buddhist candidate (Chen Lu-an) in Taiwan's 1995 96 presidential election campaigns, and in 1997 accepted an appointment to the Taipei government's cabinet-level Overseas Chinese Affairs Commission. Debbie Kuo, ''Master Hsing Yun Appointed Commissioner of O'Seas Chinese Affairs,'' Central News Agency [Taiwan], Feb. 16, 1997; Sullivan, supra note 31, p. A22; Tsong Ching, ''Master Hsing Yun and Preceptor of State Yu Lin,'' Pacific Journal, May 3, 1996 (Ex. 22) (translated by Michael Yan for the Governmental Affairs Committee). According to press reports, Hsing Yun's ''pattern of influence building'' has given him ties to ''a number of world leaders.'' Sullivan, supra note 31; see also generally Stuart Chandler, Establishing Friendly Relations: The Fokuangshan Perspective on the Hsi Lai Temple Political Donations Controversy (unpublished monograph, June 14, 1997) (Ex. 23, p. 13).
35Hsing Yun once wrote a novel about a Buddhist monk named Yu Lin, who was appointed to political office as ''Preceptor of State'' by an emperor of the Ch'ing dynasty. This story, which was made into a movie and a television series in Taiwan, outlines Hsing Yun's ''critique and expectations of a religious-leader-turned-Preceptor-of-State'' and suggests that he entertains similar ambitions for himself. Ching, supra note 34; cf. Fu Chi-ying, Handing Down the Light: The Biography of Venerable Master Hsing Yun (Hsi Lai University Press 1996) (translated by Amy Lui-Ma) (Ex. 24, p. 106).
36John Mintz, ''Fund-Raisers Pressured Temple After Gore Visit; 12 Donors Were Reimbursed,'' Washington Post , June 13, 1997, p. A20 (recounting that Hsing Yun has called himself ''political monk''); see also Ching supra note 34. To this end, in expanding his order to the United States, 37 Hsing Yun apparently hoped to continue ''spreading the Dharma,'' i.e ., increasing popular receptivity to Buddhist ideas and culture, through political fundraising in U.S. politics. (note - 38) As he made clear to the Committee when he was interviewed in Taiwan in June 1997,
37The name of the elaborate temple complex constructed by the IBPS to be the headquarters of the Fo Kuang Shan order's North American operations illustrates its intended mission of spearheading the order's expansion into the United States: Hsi Lai means ''Coming to the West.'' Hsing Yun's biographer describes the founding of the temple in Hacienda Heights as ''a milestone that mark[ed] the Dharma coming to the Western world.'' (Ex. 24, p. 342).
38 See Ex. 23, p. 4 (''As another means to establish Hsi Lai Temple as a legitimate, fully accepted member of the [U.S.] community, Master Hsing Yu AE4n and the temple's various abbots have consistently sought to secure 'friendly relations' with local and national political leaders.''); id., p. 16 (describing order's political involvement in Taiwan and noting that ''[i]n light of Master Hsing Yu AE4n's willingness, even eagerness, to create 'friendly relations' with government officials, both in Taiwan and abroad, the fact that he invited Gore to Fokuangshan in 1989, and subsequently honored him with a banquet as Hsi Lai Temple, no longer seems so bizarre.''). Speaking of political donations, I feel that, my entire life, I have been a person who enjoys doing good deeds and giving to others. . . . I give people assistance. I am grateful for the economic aid that the United States government gave to the Republic of China thirty or forty years in the past. Having established two-way communication with the United States, I feel that I ought to express my gratitude and repay the country. (note - 39)
39Hsing Yun, ''Statement to Governmental Affairs Committee Fact-finding Team'' June 17, 1997 (Ex. 25, p. 2). (This document was prepared by Hsing Yun for the Committee in advance of his interview on June 17, 1997; it does not represent an account of this interview.) This penchant for political involvement helped make Hsing Yun's Fo Kuang Shan order an eager collaborator in Maria Hsia's political activity. 40 Over the next few years, Hsing Yun's organization helped Hsia and her PLC co-founders in three principal ways:
40Ironically, however, according to Howard Hom, Maria Hsia was generally contemptuous of persons who became involved in political activity through political conviction; she believed that real political power flowed from campaign contributions rather than passion and policy activism. Hom interview, p. 3. (1) The Fo Kuang Shan order helped pay for the PLC's trip to Asia in early 1989 and hosted the PLC delegation at its temple headquarters in Kiaoshung, Taiwan; (2) The order provided Maria Hsia with a lucrative sideline in procuring ''religious worker'' visas and green cards for Temple monastics and devotees coming to the United States under provisions of the 1990 immigration act for the passage of which she had successfully lobbied; and (3) The order gave Hsia access to a deep reservoir of money for illegally laundered political donations, upon which she would draw heavily in the years to come. In return, the Fo Kuang Shan order perceived itself as becoming increasingly influential within the Democratic Party. By late 1996, brochures prepared by the Hsi Lai Temple had come to describe Hsing Yun as an ''informal liaison to the White House on Asian affairs.'' 41
41Lena H. Sun, ''Gore 'Community Outreach' Touched Wallets at Temple: April L.A. Event Raised Funds and Questions,'' Washington Post, Oct. 25, 1996, p. A1.
The PLC's trip to Asia in 1989 was organized by John Huang, James Riady, and Maria Hsia, with Huang playing the lead role. Here again, James Riady's enormous role in the PLC was visible: according to a report on the preparations Huang gave to a PLC meeting in November 1988, Riady and his employee Huang provided $10,000 in seed money to help cover the trip's costs. This money was deposited in an account controlled by Huang, Hsia, and Fred Hong at Riady's own Bank of Trade. 42 Overall sponsorship of the trip was ostensibly to be provided by a ''non profit organization in Indonesia''; this was being arranged by James Riady. (note - 43)
42Minutes of PLC Meeting, Nov. 10, 1988, p. 1 (Ex. 26).
43Riady's role as perhaps the single most important figure behind the 1989 trip is also suggested by a letter sent in July 1988 by Huang's assistant to a member of Senator Kent Conrad's staff as part of the PLC's efforts to organize the Asia trip. According to this letter, Riady had picked the ''dignitaries, public officials and business leaders in Taiwan, Hong Kong, Singapore and Indonesia'' who were to be visited by the PLC delegation. Interestingly, this list included a number of ''PRC Related Officials,'' including the head of the Xinhua News Agency in Hong Kong, described as ''equivalent to PRC Ambassador,'' and the head of China Resources, which was called ''PRC's key foreign trading company.'' Virginia H. White, letter to Karen Frederickson, July 28, 1988 (Ex. 27). (For more about China Resources, see the sections of this report dealing with Lippo and with intelligence matters.)
Originally, the plan had been to invite as many as five U.S. Senators, accompanied by 15 PLC members, on a trip to Taiwan, Indonesia, and Hong Kong. (note - 44) All but one of the Senators invited to participate, however, turned down the Council's invitation. (note - 45) But Senator Gore faced re-election in 1990, and had depleted his campaign funds in his failed 1988 presidential bid. (note - 46) Having been told by Senator Gore that he ''would like to know the Asian community better and would like to be closer to them,'' (note - 47) Maria Hsia explicitly promised Senator Gore her political support, as well as that of PLC co-founders such as James Riady and John Huang, if he would come join them in Asia. Indeed, Hsia advised him bluntly that ''[i]f you decide to join this trip, I will persuave [sic] all my colleagues in the future to play a leader role in your future presidential race.'' (note - 48) Gore thereupon accepted, becoming the only national-level U.S. politician to join the PLC in Taiwan.
44Ex. 26, p. 2.
45Hom deposition, p. 56.
46 See Al Gore, letter to Maria Hsia, May 23, 1989 (Ex. 29).
47Maria Hsia, letter to Albert Gore, Nov. 22, 1988 (Ex. 30) (recounting conversation with Gore during event at home of Pamela Harriman). This Harriman event was probably not the same event referenced in a document in the handwriting of Jeff Su--Maria Hsia's political assistant--representing a fax transmission from Hsia to John Huang at Bank of Trade. This document describes a dinner party for 25 30 guests at Harriman's house costing $3,000 to $5,000 per person with proceeds going to Friends of Al Gore. See Maria Hsia, memorandum to John Huang (undated) (Ex. 31). According to Howard Hom, Jeff Su only began working for Hsia in 1989, suggesting that the Harriman event referenced in Hsia's November 22, 1988 letter was a prior fundraiser. See Hom deposition, pp. 77 78.
48Ex. 30. This letter is in the Committee's possession only in ''draft'' form, but Howard Hom recalls that it was ultimately sent as written. See Hom deposition, p. 59.
Thanks to the partial financial sponsorship provided by Hsing Yun, part of the Taiwan leg of the PLC's Asia trip consisted of a visit to the Fo Kuang Shan temple in Kiaoshung. Attending with a delegation that included James Riady and his wife Aileen, John Huang and his wife Jane, Eddy Yang and his wife Jenny, Fred Hong, Howard Hom, and Maria Hsia, as well as Gore staff members Peter Knight and Leon Fuerth, 49 Senator Gore toured the Kiaoshung Monastery on January 11, 1989 and met with Hsing Yun. (note - 50)
49Pacific Leadership Council, attendance list for January 1989 trip (Ex. 32). Knight was then Gore's chief of staff, while Fuerth was his foreign policy advisor. (This document was not a final list of participants, but Howard Hom recalls it being accurate apart from exceptions that are irrelevant for present purposes. See Hom deposition, pp. 61 62.)
50Indeed, during their meeting, Senator Gore and the Venerable Master discussed the Senator's hopes to win the U.S. presidency. According to Hsing Yun, when Senator Gore visited Fo Kuang Shan . . . I said to him, ''You can
become the president of the U.S.'' He was excited upon hearing that and
said, ''I will visit you when I become the president.'' Hsing Yun, article in Universal Gates Monthly (May 1996) (Ex. 33, pp. 183 184) [translated from the Chinese by SA Becky Chan for the Governmental Affairs Committee].
This was the start of an extremely close relationship between Hsia and Senator Gore. After the January 1989 trip to Taiwan, Hsia became an active fundraiser for the Senator's reelection campaign. (note - 51) Over the next 22 months, until his reelection to the Senate in November 1990, for example, Hsia was involved with--with the help of her ''political assistant'' Jeffrey Su 52 --numerous fundraising events for the Gore campaign, working in conjunction with campaign officials to refer her own friends and fundraising colleagues to Gore events in Southern California. (note - 53) Hsia also helped organize Asian-Americans and Indo-Americans in Tennessee in support of Senator Gore's re-election, forwarding lists of affluent Chinese-Americans in Tennessee to the Senator's fundraising staff and helping publicize Indo-American events among her PLC fundraising colleagues. (note - 54)
51She and her colleagues also did fundraising for other Senators. See, e.g., DSCC Tally Sheet (1989 1990) (ex. 34) (listing DSCC recipients including Senators Paul Simon, Tom Harkin, John Kerry, and Carl Levin); List of contributors to Sen. Howell Heflin dinner, Nov. 27, 1989 (Ex. 35). Gore, however, was the particular object of Maria Hsia's attentions.
52Jeffrey Su was hired by Hsia in early 1989--after her return from the trip to Taiwan--to help her run her various political activities and particularly to assist her in working for Senator Gore. Hom deposition, pp. 75 & 78.
53 See, e.g., Maria Hsia, memorandum to DSCC members, March 20, 1989 (Ex. 36) (list of upcoming Gore events); Debra Fried, memorandum to ''Finance leadership and contacts/Friends of Al Gore,'' July 27, 1990 (Ex. 37) (forwarding list of upcoming Gore fundraisers on West Coast in August 1990); Hari Lal, letter to Debra Fried, Aug. 14, 1990 (Ex. 38) (discussing Gore visit to Los Angeles); Handwritten memorandum on ''Gore Reception 3/21'' chaired by Eddy Yang at home of PLC founding member Tina Bow (otherwise undated) (Ex. 39); Jeff Su, fax transmission to John Huang, Aug. 6, 1990 (Ex. 40) (discussing ''the Gore reception on Thursday''); Jeff Su, fax transmission to Hari Lal, Aug. 15, 1990 (Ex. 41) (discussing upcoming Gore events).
54 See Ju Hong Taur, letter to Maria Hsia, Feb. 9, 1989 (translated by SA Becky Chan for the Governmental Affairs Committee) (Ex. 42) (forwarding list of Chinese persons for fundraising solicitation and political organization); Ex. 43 (Maria Hsia, fax transmission to John Huang, March 9, 1990 [RE: Reception for Senator Gore by Indo-American community'']; Hari Lal, fax transmission to Maria Hsia, Oct. 1, 1990 [advising Hsia of Indo-American plans for Gore fundraisers in Tennessee]); see generally Hom deposition, pp. 78 81 (recounting Hsia's role in organizing Asian-Americans and Indian-Americans).
The PLC organized a fundraiser of its own for Senator Gore's campaign on May 21, 1989--a $250-per-person event held at the California home of PLC founding member Tina Bow and consisting of a ''private reception'' with the Senator for PLC members and event sponsors followed by a ''general reception.'' (note - 55) The event was chaired by Fo Kuangshan advisor Eddy Yang, but Hsia was one of its principal organizers, designing and mailing the invitations for the affair, helping arrange musical entertainment 56 and inviting ''DSCC Members and Friends'' to participate, advising them that Senator Gore was ''a likely candidate for president in 1992.'' (note - 57)
55Maria Hsia, letter to ''DSCC Members and Friends,'' May 5, 1989 (Ex. 44) (discussing May 21 fundraiser); R.S.V.P. return and from Maria Hsia's computer file, May 3, 1989 (Ex. 45) (indicating $250 solicitation for event ''sponsors'').
56 See Ex. 45 (draft invitations from Maria Hsia's computer file, with handwritten edits, and handwritten draft of invitation); Maria Hsia, letter to Johan Sendjaja, May 3, 1989 (Ex. 46) (discussing arrangements for band and public address system at May 21 Gore reception); Handwritten notes from Maria Hsia's file detailing preparations for May 21 reception (Ex. 47).
Nor were Hsia and her colleagues above using Fo Kuang Shan monastics in their fundraising for Senator Gore. Underlining the PLC's reciprocal commitments with the Senator, for example, Eddy Yang helped arrange for several monks and nuns from the Temple to attend the May 21, 1989 Gore fundraiser. (note - 58) This event reportedly raised nearly $20,000 for Senator Gore; he accordingly wrote a thank-you letter afterwards to one of the monastics saying that he ''deeply appreciates your support and the support of your congregation.'' (note - 59) Senator Gore thereafter thanked Hsia for her support, assuring her that this assistance was vital because
58Hom deposition, p. 67 (''[T]he temple sent a team of monks and nuns to the event, and as I recall, someone spoke as the representative of that [organization], and because of that connection or linkage, Eddy Yang was an event chair because of his connection initially with the Buddhist temple that helped subsidize the trip to Taiwan.'').
59William Rempel, Alan Miller & Henry Weinstein, ''Buddhist Temple repaid some DNC Donations,'' Los Angeles Times , May 23, 1997, p. A1. my involvement in the Presidential race over the past two years has delayed my efforts to raise money for the 1990 campaign and left our coffers empty for the upcoming race. Your contribution at the early stage of this effort has helped to replenish our account and will allow me to build a strong organization. . . . (note - 60)
In addition to Gore-specific fundraising events, the DSCC's political-contribution ''tally'' system proved to be a valuable tool for Hsia as she swung her newfound fundraising clout behind Senator Gore, representing as it did a convenient way around limits on ''hard'' campaign finance contributions. (note - 61) Rather than limit their overall support of a particular candidate to the $2,000 level specified for total individual ''hard'' donations, contributors to the DSCC arranged to earmark much larger ''soft'' money contributions for particular candidates. As Howard Hom remembered it,
61By federal law, contributions to individual candidates for Congress are limited to $1,000 per contributor for the primary and general election campaigns, for a total of $2,000 per contributor. The contributor donated under the name of DSCC, and
DSCC could do with it as they wished, but as the group found out during the Leo McCarthy campaign for the U.S. Senate in 1988, . . . we could request that all or a portion of any donation be tallied or allocated to use in a particular race. So we could say we want 90 percent to go to Al Gore and 10 percent to go to, say, Leo McCarthy. (note - 62)
62Hom deposition, p. 71; see also id ., p. 88 (noting that ''the DSCC soft money tally would be separately allocated'' from ''the individual contribution to the 2,000-per-year max[imum]''). In other words, donors would give money to the DSCC itself in large, unregulated ''soft'' money contributions, so that the DSCC could funnel designated amounts of each personal total to designated candidates with exactly the same result as if the $1,000 limitations had never existed. This system was ultimately found to be illegal--with the result that the DSCC paid $75,000 in fines to the FEC(63( --but for several years this ''tally'' system proved an invaluable means of skirting federal election laws.
63 See Federal Elections Commission, Matter Under Review 3620, conciliation agreement, Aug. 11, 1995.
After returning from the PLC's Taiwan trip, Hsia also worked for Senator Gore's re-election campaign through this DSCC tally system. (note - 64) As documented in files of her fundraising activity kept by Hsia and Howard Hom, for example, a donor named Michael Reyes became the frequent target of her efforts to earmark his DSCC contributions for Gore's re-election campaign. (note - 65) In the period before the 1990 elections, the DSCC ''tallied'' at least $29,500 to Senator Gore's campaign. (note - 66) Senator Gore was well aware of this work she undertook on his behalf. As he put it in a letter he wrote to Hsia in January 1989, for example,
64Ex. 34 (''RE: DSCC tally to Senator Gore/Please check to see if the DSCC did in fact tally money to Sen. Gore per our request''); Jeff Su, fax transmission to Debra Fried, Aug. 22, 1990 (Ex. 48) (''John Huang will be attending the DSCC 1990 Fall Dinner. Maria will contact John and tell him [to] tally his $1,500 to Sen. Gore.'').
65 See, e.g. , Maria Hsia, fax transmission to Michael Reyes, Dec. 2, 1988 (Ex. 49) (''I would like to tally your contribution to Senator Al Gore if you have no objections since his reelection is coming.'').
66Senator Paul Simon received even more DSCC money, being the recipient of $36,500 in DSCC ''tallies.'' Other recipients included Senators Howell Heflin ($7,500), Carl Levin ($2,500), Max Baucus ($1,000), John Kerry ($1,000), and Tom Harkin ($4,000). See Ex. 34. I wanted to thank you for your generosity in crediting by DSCC tally with the checks from Michael Reyes and Tony Hsu. I have sent letters to both thanking them and crediting you as the contact. Thanks so much; it will help a great deal as we move into the 1990 Senate campaign. You are a wonderful friend. (note - 67)
67Al Gore, letter to Maria Hsia, Jan. 31, 1989 (Ex. 50); see also Ex. 48 (''Senator Gore should call Michael [Reyes] and ask him to tally the remaining $5,000 to his campaign once it is paid.''). Another letter in December 1990 similarly thanked Hsia for ''your generous contribution to the Democratic Senatorial Campaign Committee, which you had tallied to me.''(68( Throughout the 1989 90 re-election campaign, Hsia remained in close contact about fundraising matters with Senator Gore and campaign officials such as Debra Fried of Friends for Al Gore.
68Albert Gore, letter to Maria Hsia, Dec. 5, 1990 (Ex. 51).
All of this fundraising support was, of course, part of the rather explicit bargain Hsia had struck with Senator Gore in inviting him to visit Taiwan in November 1988. Hsia approached her political fundraising with clear objectives in mind,(69( and Senator Gore's presidential ambition appears to have been her most favored long-term prospect. As Hsia put it in a note to one DSCC contributor, whom she was at that point trying to persuade to ''tally'' an additional $5,000 to Friends of Al Gore, help for Senator Gore was important because he had been ''willing to take the Lead role to travel [to] Asia and [was] willing to work with us on a long term relationship for his future presidency.'' (note - 70)
69Hsia advised Michael Reyes in January 1989, for instance, that $5,000 should be allocated to Senator Paul Simon, ''since he sits on the immigration sub-committee [and] he will be a very helpful source on any immigration related issues.'' A final $5,000 should be reserved, she said, for ''any [other] Senator who is responsive to our group's needs.'' Maria Hsia, fax transmission to Michael Reyes, Jan. 18, 1989 (Ex. 52).
70 Id .
In fact, never a woman to say with circumspection what might be put bluntly, Hsia made no secret of her expectations even when writing to the Senator himself. Four days after the PLC's first fundraiser for Al Gore on May 21, 1989, she wrote to tell him that We were so happy that you were able to spend some time with members of the Asian Pacific American community here in Los Angeles. . . . I appreciate your willingness to provide an opportunity for people to get to know you better. I would also like to see you become one of the senators closest to the Asian Pacific community. But for that to occur, we need time and a special commitment from each other. If you share the same sentiments, please allow my colleagues and I a role in developing this relationship. (note - 71)
71Maria Hsia, letter to Albert Gore, May 25, 1989 (Ex. 53).
Because of her work in the immigration services business, U.S. immigration law was another area of great personal interest to Hsia. By February 1989, a major immigration reform bill was being prepared in Congress,(72( ultimately to become the Immigration Act of 1990. As this bill moved through the legislature during 1989, it became the subject of much lobbying by immigration services providers such as Hsia and Howard Hom. As finally adopted, the Act included a number of provisions of great value to such persons. First, the Act restricted deportation and provided work authorization for the spouse or unmarried children of legalized aliens. (note - 73) Second, the Act contained new provisions for what would become known as ''investor immigrants'' (persons who received special visa preferences by virtue of their willingness to invest and/or create jobs in the United States) (note - 74) and ''multinational executive'' immigrants (persons employed by a foreign corporation seeking to work for it in the United States). (note - 75) Third, the Act created an entirely new visa category for ''religious workers'' who belong to ''religious denomination[s] having a bona fide nonprofit, religious organization in the United States'' and who seek entry in order to work here for their denomination. (note - 76)
72Tom Griffith & Steve Huefner, letter to Christopher A. Ford, Aug. 18, 1997 (Ex. 54) (detailing legislative history of Immigration Act of 1990).
73P.L. 101 649, 301 [104 Stat. 4978, 5029]. As a result, an immigration services provider could use one alien's legal residence in the United States as a lever with which to secure visas (and ultimately legal residency) for other members of his or her family. This often enabled immigration services companies to develop an expanding ''tree'' of paying customers out of a single initial client contact. Hom and Hsia did a lucrative business by such expedients; according to Hom, losing the family reunification preferences ''would have wiped out a certain percentage of the client base.'' See Hom deposition, p. 120.
74P.L. 101 649 121(b)(5) [104 Stat. 4978, 4989 90].
75 Id ., 121(b)(1)(C) [104 Stat. at 4988]. By the nature of these two categories, it was difficult to be both poor and eligible for their visa preferences. Moreover, demand for such visas far exceeded their supply--necessitating the development of a lottery system and leading clients eagerly to seek any chance for a perceived special advantage. See Hom deposition, pp. 128 129.
76P.L. 101 649, 151 [104 Stat. at 5004 05]. Similar provisions applied for temporary work visas, and these religious worker nonimmigrants were exempted from the overall visa caps established elsewhere in the legislation. Id . at 201(b)(1)(B) & 209 [104 Stat. at 4981 & 5027]. For a discussion of the new religious worker rules, see Hom deposition, pp. 132 33.
All three of these visa categories were to become lucrative parts of Hsia's business, especially after her association with the Fo Kuang Shan order gave her and Howard Hom the job of handling immigration work for foreign members of the Order affiliating with its U.S. branches such as the Hsi Lai Temple in Hacienda Heights, California. (note - 77) Hsia had long believed that her political activity provided important intangible advantages in her immigration services work, feeling that if she were ''politically active,'' her clients would conclude that she had ''more ability and more power to help them in their cases.'' (note - 78) In 1989, with an immigration bill pending in Congress that could provide a vehicle for visa provisions of such value to her business, Hsia set about to use her political ties to reap more concrete benefits as an immigration law lobbyist.
77When Hom and Hsia stopped living together, Hsia took the Temple's immigration business with her, making it a major part of her work with Hsia & Associates. Hom deposition, pp. 160 61; Deposition of Man Ho, Aug. 6, 1997, pp. 51 54; Deposition of Yi Chu, Aug. 7, 1997, p. 24; see also Deposition of Matthew Gorman, Sept. 23, 1997, pp. 140 43; (Ex. 55) (collection of illustrative immigration documents and invoices for services rendered sent from Hsia & Associates to Temple in 1996); Deposition of Man Ya Shih, Aug. 20, 1997, p. 16 (recounting that she obtained green card through Hsia at Temple's expense); Deposition of Siuw Moi Lian, Aug. 20, 1997, p. 11 (same); Deposition of Huei-Tsan Huang, Aug. 20, 1997, pp. 11 12 (discussing Hsia's role in obtaining a green card for her and in performing immigration services for Temple). According to Hsia's assistant at Hsia & Associates, Matthew Gorman, work for the Temple made up somewhere between 20 and 35 percent of Hsia's immigration business. Gorman deposition, pp. 75 76. Maria Hsia even handled immigration matters for Venerable Master Hsing Yun himself. See Notice of Entry of Appearance as Attorney or Representative for Hsing Yun, Oct. 28, 1996 (Ex. 56).
78Ex. 3, p. 28. According to Hsia, political involvement occasionally could lead to help with specific cases. Congressman Howard Berman's office, she claimed, helped her develop ways to improve client's chances in certain visa lotteries. Ex. 10, p. 26. Similarly, when Hsia asked for help with a particular immigration case from DSCC ''tally'' recipient Senator Paul Simon, ''he made a phone call in front of me to the immigration commissioner in Washington, DC.'' Maria Hsia, deposition in Hsia v. Hom, Ca. Super. Ct., No. BC 059523, May 10, 1994, p. 78 (Ex. 57). Senator Gore also apparently helped Hsia on at least one occasion, by referring a particular case to her. See Hom deposition, pp. 117 118; Leon Fuerth, memorandum to Maria Hsia, Dec. 14, 1989 (Ex. 58) (with attachments).
One of the principal objects of Hsia's attentions--and fundraising support--in this respect was Congressman Bruce Morrison of Connecticut, who was the immigration bill's sponsor in the House of Representatives and the author of the religious worker and ''employment-based'' immigrant provisions so important to Hsia. (note - 79) Morrison was in the middle of a difficult (and ultimately unsuccessful) gubernatorial bid in Connecticut, and badly needed the funds with which Hsia and her PLC colleagues set out to provide him. Significantly, among other things, the PLC organized a fundraiser for Morrison at the Hsi Lai Temple in Hacienda Heights on April 22, 1990. (note - 80) It was apparently not the first time Hsia had used the Temple for a political fundraising event,(81( and it was not to be the last.
79 See Ex. 54, p. 2.
80 See Ex. 59 (Jeffrey Su, fax transmission to Pat Andrews, April 20, 1990 [enclosing press release announcing upcoming Morrison event at Hsi Lai Temple]; Invitation to Asian-Pacific American Friends of United States Congressman Bruce Morrison event at Hsi Lai Temple [giving price as ''$500 per couple/$300 per person'']). Hsia was even able to turn Morrison's Connecticut defeat to her advantage by hiring him as an immigration ''consultant'' immediately after the election of 1990--for a fee of $10,000 a month for six months. See Ex. 57 (containing as sub-exhibit Consultancy Agreement between Bruce Morrison and Maria Hsia, Jan. 22, 1991). As Hsia explained it, Morrison had written ''the business provision which provides for the jo[b] creating investor category,'' and ''[t]he definition of ''new entrepreneur' will depend on Congressional intent and the implementation of the new regulations.'' Maria Hsia, fax transmission to Jamie Yang, Nov. 26, 1990 (Ex. 60). Who better, therefore, to have on one's masthead and payroll as an immigration consultant?
81Eddy Yang apparently organized a fundraiser at the Hsi Lai Temple for Leo McCarthy's campaign. See Debbie McConville, memorandum to Maria Hsia, undated (Ex. 61) (listing ''Southern California Event Fundraising'' and indicating that ''Eddie Yang Event/Budhist [sic] Temple Event'' raised $10,450). Howard Hom also recalled that one of Senator Paul Simon's several visits to the Hsi Lai Temple had been a fundraiser. See Hom deposition, pp. 87 88; cf . Maria Hsia, fax transmission to Floyd Fithian, June 23, 1990 (Ex. 62) (describing Simon ''event'' at Temple); Paul Simon, letter to Maria Hsia, Jan. 22, 1990 (Ex. 63) (thanking Hsia for ''our visit to the Hsi Lai Temple''); Hom deposition, p. 172 (recalling that when Hsia described meeting with politician as ''event'' it was most probably a fundraiser). Other officials may also have benefited from fundraisers at the temple. Cf . Jeff Su, fax transmission to ''Elka,'' Jan. 22, 1990 (Ex. 64) (discussing opportunity for California State Controller Gray Davis to meet with ''Master Hsing Yun and potential supporters at Hsi Lai Temple'').
Part of Hsia's lobbying effort during the summer of 1989--at the same time she and her colleagues were pushing DSCC donors to earmark their unregulated ''soft'' money contributions to Senators Simon and Gore--involved traveling to Washington to lobby legislators in person on the pending immigration bill. According to Hom, the delegation Hsia took to Washington even included a pair of nuns from the Hsi Lai Temple. The presence of these monastics was intended to remind members of Congress of the Al Gore sponsorship to the Temple in Taiwan and what the group--the Temple--did subsequently to let other Senators know that if they came on board on the immigration issue and other Asian issues, then they could expect the same reciprocation . . . [through] [t]rips to Taiwan and fundraising in the U.S. (note - 82)
82Hom deposition, p. 153. Hsia's group met with a number of U.S. Senators and Representatives on July 10 and 11, 1989.(83(
83 See Maria Hsia, Schedule for July 10 11, 1989 (Ex. 65). See also, e.g. , Ex. 7 (noting that Hsia ''organized and led delegations . . . to visit Washington, DC during debate on the bill in an effort to preserve the family reunification categories'').
One of her contacts on this trip was with Senator Gore, who joined staff members Peter Knight and Leon Fuerth in meeting with Hsia on July 10. Her notes of the meeting recount that they discussed his trip to Taiwan with her in 1989, and that Gore ''want[ed] to involve [himself] in the Asian Community more for [the] future.'' (note - 84) With regard to a particular amendment to the immigration bill which had by that point been reported out of the Senate Judiciary Committee's Subcommittee on Immigration and Refugee Affairs and was rapidly approaching a full Senate vote 85 --''he said [he had] no problem for co-sponsorship.'' (note - 86) The amendment they were discussing --the ''family unity'' provisions that were so important to Hsia's immigration practice was, in fact, adopted by the Senate two days later. Senator Gore was one of its co-sponsors. (note - 87)
84Maria Hsia, notes of meeting with Senators, July 10, 1989, p. 2 (Ex. 66); cf . Maria Hsia deposition in Hsia v. Hom, Ca Super. Ct., No. BC059523, apparently July 6, 1993, pp, 87 93 (Ex. 67) (discussing lobbying trip and taking handwritten notes).
85 See Ex. 54, p.1.
86Ex. 66 p. 2.
87Ex. 54, pp. 1 2, On her Washington lobbying trip, Maria Hsia employed a simple system of ''grading'' Senators on an A-to-F scale based upon their responsiveness to her concerns; Senator Gore received an ''A''. Ex. 66, pp. 1 2. In fact, to some extent, Hsia apparently coordinated her lobbying on the pending immigration bill with Senator's Gore office--as well as the offices of Senator Simon and Representative Howard Berman--in promoting her favored legislative provisions. See Maria Hsia, fax transmission to Leon Fuerth, Jan. 24, 1989 (Ex. 68); see also generally Hom deposition. pp. 142 143.
Writing to Senator Gore upon her return to Los Angeles, Hsia thanked him for ''your support on the recent immigration bill,'' adding that ''[o]n behalf of the Pacific Leadership Council and the communities we represent, I thank you for all that you have done.'' (note - 88) Writing back to her in response, Senator Gore described himself as being ''pleased to have been able to assist you'' on the immigration bill. ''Without your superb contribution,'' he said, ''it would have been much more difficult to find my way in these matters. I continue to value your good counsel.'' (note - 89) As John Huang himself later described it to then-Vice President Gore,''you worked very hard on immigration issues; you worked very hard for us.'' (note - 90)
88Maria Hsia, letter to Albert Gore, July 17, 1989 (Ex. 69).
89Albert Gore, letter to Maria Hsia, Aug. 28, 1989 (Ex. 70). By all accounts, Maria Hsia appears to have been a significant ''player'' in crafting the Immigration Act of 1990--to the point that Senator Paul Simon, one of the bill's sponsors, later presented her with the pen used to sign the bill into law. See Hom deposition, pp. 158 159. So important was this pen, in turn, to Hsia that she reported broke into the offices of her law ''partner'' Arnold Malter in July 1995 in order to retrieve it after their business relationship collapsed. See Monterey Park Police, Crime Report for file number 95 4822, July 15, 1995 (Ex. (note - 1995) (Ex. 71) (describing theft of pen as recounted by Malter to police).
90John Huang, opening remarks at Vice Presidential event in Santa Monica, Sept. 27, 1993, on WHCA audiotape of Santa Monica event, Sept. 28, 1993 [transcription by Government Affairs Committee stafff]. The White House Communications Agency apparently misdated this tape: the event actually occurred on September 27. See John Huang, letter to Jack Quinn, Oct. 7, 1993 (Ex. 72) (''We enjoyed meeting you again on the following Monday, September 27 in Los Angeles. Vice President Gore was just super.'').
In addition to more conventional communications thanking her for her fundraising on his behalf, 91 Senator Gore sent effusive handwritten comments informing Hsia and Howard Hom, for example, that ''I cannot thank you enough. You two are great friends. See you soon. Al.'' (note - 92) Hsia's involvement with Senator Gore extended even to helping him prepare his book Earth in the Balance: as Gore Chief of Staff Peter Knight wrote to Hsia in March 1991,
91 See e.g., Ex. 51; Albert Gore, letter to Maria Hsia, Dec. 10, 1990 (Ex. 73); Ex. 29; Ex. 50; cf Invitation sent to Maria Hsia for reception for swearing-in-ceremony on January 3, 1991 (Ex. 74).
92Albert Gore, letter to Maria Hsia, Oct. 2, 1990 (Ex. 75); see also Albert Gore, handwritten letter to Maria Hsia, undated (Ex. 76). The materials you got for Al's book on the environment were perfect. Thanks so much for taking the time to do it. He would have been lost without your efforts because the chapter on religion and the environment is integral to his work. (note - 93)
93Peter Knight, letter to Maria Hsia, March 6, 1991 (Ex. 77).
As will be described below, the close relationship between Maria Hsia and Al Gore continued at least through 1996. (note - 94)
94Even apart from DNC fundraiser and the April 29, 1996 Gore fundraiser, for example, Maria Hsia interceded with Deputy Chief of Staff David Stauss to procure a congratulatory message for the annual conference of the Buddha's Light International Association (BLIA) in Paris in August 1996. Compare Maria Hsia, letter to David Strauss, July 2, 1996 (asking for help in obtaining congratulations message), with Albert Gore, letter to Maria Hsia, July 26, 1996 (extending congratulations) (both Ex. 78. Hsia went so far as to invite President Clinton to attend the conference, but be declined--opting instead merely to send a congratulatory message of his own. See Ex. 79 (Maria Hsia, letter to Bill Clinton, June 13, 1996, Stephanie Streett & Ann Hawley, letter to Maria Hsia, Sept. 25, 1996; Bill Clinton, letter to Buddha's Light International Association, Aug. 2, 1996). As recounted by Temple official Man Hua during the deposition of her colleague Man Ho, Hsia became involved in trying to arrange such favors for the BLIA after learning that Yah Lin (''Charlie'') Trie was attempting to do so. Protecting her exclusive relationship with the Temple by telling Hsing Yun that Trie was ''not reliable,'' Hsia thereupon set about arranging this herself. See Man Ho deposition, pp. 54 68.
Considerable publicity has surrounded the illegal reimbursement of DNC donors by the Hsi Lai Temple in connection with an April 1996 fundraiser organized by Hsia and Huang for Vice President Gore. The pattern for this conduct, however, was actually set at least three years earlier. Both Hsia and Huang were involved in similar donation-laundering at least as early as 1993, when they laundered contributions in connection with a meeting they helped arrange between Vice President Gore's chief of staff and the head of a company reportedly linked with the intelligence apparatus of the People's Republic of China. On Thursday, September 23, 1993, Huang wrote two checks to the DNC--for $15,000 each--drawn against accounts at Lippo Bank held in the name of two U.S. subsidiaries of James Riady's Lippo Group, for which Huang still worked. Four days later, on September 27, he wrote a third $15,000 check on the account of a third Lippo subsidiary. (note - 95) Two days later, Hsia arranged for three nuns from the Hsi Lai Temple to write checks to the DNC totaling $5,000. (note - 96) All of these donations were illegal, representing money from foreign sources or money from ''straw donors'' illegally reimbursed by another party.
95 See Ex. 80 (Hip Hing Holding check #2626 for $15,000 on September 23, 1993; San Jose Holding check #1692 for $15,000 on September 27, 1993; Toy Center Holdings check #1458 for $15,000 on September 23, 1993).
96 See Ex. 81 (DNC check tracking form for Pi Hsia donation of $2,000 on September 27, 1993; DNC check tracking form for Hsin Kuang Shih donation of $2,000 on September 27, 1993; DNC check tracking form for Hsiu Chu Lin donation of $1,000 on September 27, 1993). Each check tracking form lists Maria Hsia as the solicitor of the donation described. On the ''memo'' position of Pi Hsia Hsio's check is written ''Maria Hsia.''
Huang's three DNC checks came from Lippo subsidiaries--Hip Hing Holdings, San Jose Holdings, and Toy Center Holdings--each of which had negative income at the time the checks were written. (note - 97) In other words, they were losing money; the money for his three $15,000 contributions actually came from Lippo accounts overseas. (note - 98) With regard to the $5,000 in DNC donations from Temple monastics arranged by Hsia, each nun was reimbursed that same day for their donations, through checks written on the Temple's general expenses account by the Temple's treasurer, Yi Chu. (note - 99)
97 See Ex. 82 (Hip Hing Holdings. Ltd., Income statement for period ending December 31, 1993; San Jose Holdings, Inc., Income statement for period ending December 31, 1993; Toy Center Holdings of Ca., Inc., Income statement for period ending December 31, 1993). For more information, see the section of this report dealing with John Huang and Lippo.
98Since the money clearly did not come from the U.S. operations of these companies, this was a violation of federal election law. See FEC A.O. 1992 16, Fed. Election Camp, Fin. Guide (CCH) 6059, at 11,811, June 26, 1992.
99 See Ex. 83 (IBPS check #8086 for #2,000 to Pi-Hsiao on September 27, 1993; IBPS check #8087 for $2,900 to Hsing Kuang Shih on September 27, 1993; IBPS check #8088 for $1,000 to H.C. Lin on September 27, 1993). Temple treasurer Yi Chu's lay name Tsui-Hsueh Hsueh appears on the checks. (The reimbursement to Hsing Kuang Shih was apparently $900 more than her $2,000 DNC donation because she also needed to be reimbursed for $900 in unrelated expenses she had also borne on the Temple's behalf.) All three monastic ''straw donors'' received letters from DNC Chairman David Wilhelm thanking them for their ''participation in the Los Angeles Vice Presidential Dinner on September 27.'' See Ex. (note - 84) (David Wilhelm, letter to Pi-Hsia Hsiao, Oct. 15, 1993; David Wilhelm, letter to Ksing Kuang Shih, Oct. 15, 1993; David Wilhelm letter to Hsiu Chu Lin, Oct 15, 1993). Federal election law prohibits funneling donations through third parties. See 2 U.S.C. 441f.
On Friday, September 24, 1993, the day after Huang's first $30,000 in laundered Lippo donations to the DNC, Huang escorted Shen Jueren, the head of a company called China Resources, 100 to the White House for a meeting with Vice President Gore's top adviser, his then-chief of staff Jack Quinn. (note - 101)
100China Resources is owned by the government of the People's Republic of China, and is a major business partner of the Riady-owned Lippo Group. For more information about China Resources, see the sections of this report on John Huang's activities at Lippo Bank.
101 See Ex. 72 (''I want to thank you for having taken the time out of your busy schedule to receive myself, Chairman Shen Jueren and his assistant, Miss Liang of China Resoruces Group on September 24 at your office.'') U.S. Secret Service WAVES list for June 7 through September 24, 1993 (Ex. 85) (showing Huang appointment to enter White House complex on September 24 with approval to enter both the Old Executive Office Building and the East Wing). There is a possibility that the Vice President may have also met Shen Jueren that day. The Committee has an audiotape of a September 27, 1993 meeting for Asian-Americans in Santa Monica, California, at which an individual introduced himself to the Vice President by giving his name and saying, ''we met just last Friday, in your office.'' The Vice President responded, ''Yes, of course, we just spoke.'' The Friday before this meeting in Santa Monica was the day Shen Jueren met with Quinn in the White House complex. The individual's name is not clearly intelligible, but prior to this brief conversation a word that may be ''Shen'' can be heard being spoken in the background of the audiotape. White House Communications Agency audiotape of September 27, 1993 Santa Monica event (misdated ''September 28, 1993'').
The involvement of Huang and Hsia with Shen Jueren and China Resources raises an interesting and possibly troubling issue. As is detailed elsewhere in this report, 102 the Committee has learned that Hsia has been an agent of the Chinese government, that she has acted knowingly in support of it, and that she has attempted to conceal her relationship with the Chinese government. In view of this information--coupled with information suggesting that Huang may have had a direct financial relationship with the Chinese government 103 --the Committee has examined carefully the longstanding efforts by Huang and Hsia 104 to develop close ties to U.S. politicians and cultivate influence in the U.S. political system. This information might raise concerns regarding Huang and Hsia's involvement with China Resources' Shen Jueren in 1993.
102 See chapter of report entitled, ''The China Connection.''
103 See id.
104Nor should it be forgotten that James Riady himself played a significant role in trying to put U.S. Senators in contact with the head of China Resources in connection with the PLC's Asia trip during the 1988 89 period. See supra note 43. As recounted more fully in the report chapter, ''The China Connection,'' the Committee has learned from recently-acquired information that James and Mochtar Riady have had a long-term relationship with a Chinese intelligence agency.
Public sources have for some years linked China Resources to the PRC's intelligence apparatus, describing it as an important source of what in U.S. espionage parlance is known as--non-official cover'' (note - 105) for espionage and other intelligence-related activities, e.g., covert influence operations. As one Defense Intelligence Agency employee put it in a book published in 1994, for example,
105Intelligence officers operating under ''non-official cover'' are known as ''NOCs,'' and if caught will not have the protection of diplomatic immunity. See, e.g., Norman Polmar & Thomas B. Allen, Spy Book: The Encyclopedia of Espionage (New York: Random House, 1997), p. 400. [Chinese] [c]ase officers make extensive use of commercial covers. For example, a vice president of the China Resources Holding Company ( Hua Ren Jituan ) in Hong Kong is traditionally a military case officer from Guangzhou. This officer coordinates the collection activities of other intelligence personnel operating under Hwa Ren [China Resources] cover. (note - 106)
106Nicholas Eftimiades, Chinese Intelligence Operations (Naval Institute Press, 1994), p. 80. The increased prestige in commercial and political circles that could be derived from access to U.S. politicians would presumably be of no small value to such an operation.
The link between Hsia and the Chinese government might also cast into a different light certain other episodes in Hsia's history of political activity in the United States. (note - 107) Among these would be her ties to Ted Sioeng, who as described elsewhere, has worked, and perhaps still works, on behalf of the Chinese government. (note - 108) Sioeng sat at the head table next to Vice President Gore and Hsia at the April 29, 1996 Hsi Lai Temple fundraiser. The Committee has received information that Hsia worked with Sioeng and Huang to solicit contributions from Chinese nationals in the United States and abroad for Democratic causes. (note - 109)
107For example, Hsia apparently considered lobbying for the People's Republic of China on a commercial basis after the end of her relationship with Howard Hom, and claimed to have become increasingly involved with the PRC in immigration matters after 1992. See Ex 57 (containing as sub-exhibit Bruce Morrison, memorandum to Maria Hsia, April 14, 1991); Ex. 3, p. 58; see also Hom deposition, p. 184. Though she claimed in a November 1997 interview that ''I have never had a single conversation with any Chinese government official about U.S. politics,'' Hsia also invited four Chinese consular officials to a reception in honor or Senator Tim Wirth in 1991, and hosted delegation of Chinese government officials on a trip to Washington during the summer of 1996. Compare David Johnston, ''Files on China Embarrass F.B.I. and Reno, and Miff Subject,'' New York Times, Nov. 15, 1997, p. A12 (quoting Hsia), with Jeff Su, memorandum to Paul DeNino, May 8, 1991 (Ex. 86) (listing consular officials at Wirth event), and Gorman deposition, pp. 119 23; Matthew Gorman, sworn statement to Governmental Affairs Committee, Aug. 27, 1997 (Ex. 87, p. 3, 17) (discussing visit to Washington).
108 See chapter, ''The China Connection.''
109 See the section of this report entitled ''The China Connection.''
Quite apart from these individuals' ties to the Chinese government, however, it should be clear by now that if one is to understand the Hsi Lai Temple's involvement in the 1995 96 election cycle, and even the issue of Vice President Gore's knowledge with regard to the Temple fundraiser of April 29, 1996, one must first understand the breadth and depth of the relationship between Maria Hsia and Vice President Gore. What the Vice President knew and when he knew it is not a question, in other words, that may be understood in isolation from the past. Rather, it must be placed in context, as the outgrowth of the long history of Vice President Gore's dealings with Maria Hsia, John Huang, James Riady, and Hsing Yun's Fo Kuang Shan Buddhist order.
As the preceding pages indicate, the relationship between these five key figures was complex, but it was one firmly grounded in mutual advantage and revolving around political fundraising. Understood from the perspective of its participants, therefore, this history places the events of 1996 in a new light. Ultimately, given the elaborate system of reciprocal assistance among them and the considerable financial investments the PLC's founding members had made in Vice President Gore's political career, the Vice President had to have understood that any DNC event organized at the Temple by Maria Hsia and John Huang could only really be for one purpose. Despite the political salience of this ''knowledge'' issue, however, the Temple incident involves much more than simply a single fundraiser unwisely attended by the Vice President and unlawfully supported by Hsia and Temple monastics who had become accustomed to relying upon Hsia to steer their illegal financial support to U.S. politicians. The DNC donation-laundering arranged by Huang and Hsia in April 1996 was part of a broader pattern dating back at least to their collaboration in the Shen Jueren affair of September 1993. In some sense, the Temple episode of 1996 may even be understood as the product of a mutually-reinforcing relationship between Huang and Hsia that began in the late 1980s with their involvement in the PLC and their fundraising for the DSCC.
Huang's appointment as a DNC fundraiser in early 1996 brought Huang and Hsia back together in ways familiar to both of them, and with higher stakes than ever. As we have seen, Huang had used Lippo resources to help Hsia make up for unanticipated financial shortfalls in her political fundraising. (note - 110) By early 1996, the tables had turned, and Hsia had an opportunity to return the favor by greatly expanding what had hitherto been a relatively small-scale Hsi Lai Temple donation-laundering scheme into a potent fundraising machine for the Clinton/Gore campaign. The infamous Hsi Lai Temple fundraiser of April 1996 is thus only part of this story; over the course of 1996, Hsia and Huang would raise over $100,000 in laundered Temple donations to help keep Bill Clinton and Al Gore in the White House.
110 See supra text accompanying footnote 24.
II. A PATTERN OF DONATION-LAUNDERING: 1993 1996
Hsia's involvement with illegally laundering money from the Hsi Lai Temple to U.S. politicians began at least as early as June 1993, with a donation made by Hsia herself to a longtime Hsia fundraising beneficiary, California Secretary of State March Fong-Eu. Hsia wrote a $500 check to March Fong-Eu's campaign in June 1993, having been earlier given $500 for that purpose by the Temple's treasurer. (note - 111) In September 1993, as indicated previously, Hsia also arranged to launder $5,000 of the Temple's money through three monastic ''straw donors'' to the DNC for an event with Vice President Al Gore. (note - 112)
111 See Ex. 88 (Form 490, List of Contributions Received by March Fong Eu Campaign Committee '94 recording $500 contribution by Maria L. Hsia in June 1993; IBPS check #7562 for $500 to Maria Hsia on June 4, 1993); Man Ho deposition, p. 214 (testifying that Temple supported March Fong-Eu).
112 See supra text accompanying notes 96 99.
The September 1993 episode involving the Vice President set a pattern for Temple donation-laundering that would persist until the 1996 elections: Hsia would telephone a nun at the Temple named Man Ho, 113 who served as the Temple's chief administrative officer during this period, to inform her that she needed a certain sum of money in connection with a particular political fundraising event or political campaign. Man Ho would then pass along this request to the Temple's Abbess or Abbot of the time. The Abbot or Abbess would, in turn, approve a check request form prepared by Man Ho, who would give this completed form to Yi Chu, the Temple's treasurer. (note - 114)
113Because Temple officials and monastics invoked their Fifth Amendment privilege against self-incrimination when asked about their involvement in DNC fundraising, the Committee granted immunity to five nuns in exchange for their testimony: Man Ho, Yi Chu, Man Ya Shih, Hueitsan Huang, and Siuw Moi Lian.
114 See Testimony of Man Ho, Sept. 4, 1997, pp. 48 49; Man Ho deposition, pp. 85 86 (testifying that September 1993 was first time Hsia asked Man Ho for political donations); id., p. 92 (affirming repetition of same pattern with other contributions); id., pp. 199 & 211 13 (discussing pattern of calls from Hsia). Unbeknownst to Man Ho until late in 1996, 115 upon receiving the check request for political contributions, Yi Chu would then approach Temple monastics or devotees and ask them to write personal checks. (note - 116) The total amount raised by means of these checks would be the total figure Hsia had requested and the amount that Man Ho had indicated on the check request form approved by the Abbot or Abbess. (note - 117) Either the person who wrote the check or Yi Chu would place the name of the political recipient on the payee line of the check. (note - 118)
115Man Ho deposition, pp. 199 201.
116Yi Chu deposition, pp. 69, 79, 84, & 92 (discussing pattern). The reimbursement was not, however, unknown to Hsia: as noted above, she herself was reimbursed for a donation to March Fong-Eu in June 1993.
117Man Ho deposition, pp. 196 97.
118Yi Chu testified that she did not know what ''DNC'' stood for until the scandal broke in the press; she believed that few, if any, of the individual reimbursed donors had a much understanding of to whom, or for what purpose, their checks were being written. Yi Chu deposition, pp. (note - 7779; Testimony of Chu, Sept. 4, 1997, pp. 46 47.
At about the same time she received each personal check from the monastics whom she had solicited, Yi Chu would write a check for the identical amount, drawn on the Temple's general expenses account and made payable to the ostensible political contributors. (note - 119) Hsia typically stopped by the Temple to pick up the monastics' donation checks from Yi Chu or Man Ho, while Yi Chu gave the Temple's reimbursement checks to the donors so that they could cover the cost. 120
119Yi Chu deposition, pp. 86 87.
120 See, e.g., id., pp. 39 42 & 46 (recounting that reimbursement checks were needed because monastics often could not afford contributions otherwise).
The money used for these laundering transactions belonged to the Hsi Lai Temple as a whole: the reimbursement checks were all drawn upon the Temple's ''general expenses'' account, which was in turn filled exclusively from an account into which flowed donations made to the Temple and the Fo Kuang Shan order by faithful Buddhist devotees in all walks of life. (note - 121)
121 Id., pp. 86 88; Yi Chu testimony, p. 47. Though some monastics did keep so-called ''Futien accounts'' at the Temple, their money being held by the institution in a form of private banking and segregated for each monastic's own use, these Futien accounts were not used to reimburse political donations. See generally Yi Chu deposition, pp. 16 19; Yi Chu testimony, pp. 50 51.
The general pattern was simple: Hsia would select the recipient politician, ask the Temple for money, and the Temple would funnel its own institutional funds through monastic straw donors to that politician's campaign. This scheme served Hsia and a number of U.S. politicians quite well until the 1996 elections, by which point Hsia was using it so frequently that Yi Chu complained to Man Ho that the requests left her too little time to find monastic donors who could be reimbursed. (note - 122)
122 See Man Ho testimony, p. 48; Yi Chu deposition, p. 84. As a result, for the last known Temple reimbursement--in October 1996--Yi Chu simply gave Man Ho five blank Temple checks and left it for Man Ho to solicit the donors/reimbursees herself.
Hsia's laundering of Temple donations to U.S. politicians continued in 1994 with two separate episodes in which money was funneled to Julia Wu, a local school board candidate. In the first such instance, a monastic named Jou Sheng donated $2,000 to Wu's campaign in March 1994 and was reimbursed the next day by Yi Chu. (note - 123) According to the Temple's attorneys, another $3,000 was also laundered to Julia Wu at this time, being passed through Pi-Hsia Hsiao and Nancy Mao, who were also reimbursed with checks numbered sequentially with that written to Jou Sheng. (note - 124) The Temple laundered money to Wu's campaign again in May 1994, with at least $2,000 passing through Temple Abbess Hsing Kuang Shih, as well as an additional $3,000 through Pi-Hsia Hsiao and Hsiu Chu Lin. (note - 125) In July 1994, Pi-Hsia Hsiao gave $900 to the campaign of another local California official, Los Angeles County Tax Assessor Kenneth Hahn, and was reimbursed by Yi Chu for her efforts. (note - 126) Hsia and the Temple returned to national-level fundraising in September 1994 by laundering $5,000 to the campaign of Senator Edward Kennedy. (note - 127
123 See Ex. 89 (Jou Sheng check #187 for $2,000 to Friends of Julia Wu on March 2, 1994; IBPS check #8880 for $2,000 to cash on March 3, 1994, endorsed on reverse by Jou Sheng).
124 See Ex. 90 (IBPS check #8881 for $2,000 to cash on March 3, 1994, endorsed on reverse by Pi-Hsia Hsiao; IBPS check #8882 for $1,000 to ''cash NANCY MAO'' on March 3, 1994, endorsed on reverse by Nancy Mao). Interestingly, Man Ho--normally the conduit for Hsia's requests--claimed not to have been involved in the Julia Wu donations, leaving open the question of which other present or former Temple officials have been involved in Hsia's donation-laundering schemes.
125 See Ex. 91 (Hsing Kuang Shih check #587 for $2,000 to Julia L. Wu on May 4, 1994; IBPS check #9167 for $2,000 to Hsing Kuang Shih on May 6, 1994); see also Ex. 92 (IBPS check #9168 for $2,000 to Pi-Hsia Hsiao on May 6, 1994; IBPS check #9169 for $1,000 to Hsiu Chu Lin on May 6, 1994).
126Ex. 93 (Ph Hsia Hsiao check #174 for $900 to Committee to Re-elect Assessor Kenneth Hahn on June 15, 1994; IBPS check #9397 for $900 to Pi-Hsia Hsiao on July 1, 1994).
127 See FEC Info database printout of individual contributor data (Ex. 94) (listing total of $2,000 in contributions by Pi-Hsia Hsiao to Kennedy for Senate, recorded by campaign on September 15, 1994); Id. (listing $2,000 to Kennedy for Senate from Ling-Tzen Huang, recorded on same date); id. (listing $1,000 to Kennedy for Senate from Hsiu-Chu Lin, recorded on same date); Ex. 95 (Pi-Hsia Hsiao check #179 for $2,000 to Kennedy for Senate on September 6, 1994; Hsiu Chu Lin check #365 for $1,000 to Kennedy for Senate on September 6, 1994; IBPS check #1034 for $2,000 to Pi-Hsia Hsiao on September 6, 1994; IBPS check #1035 for $2,000 to Ling-Tzen Huang on September 6, 1994; IBPS check #1036 for $1,000 to cash, endorsed on reverse by Hsiu Chu Lin).
The first recipient of laundered Hsi Lai Temple money arranged by Maria Hsia in 1995, was apparently the DNC itself, in connection with a Clinton/Gore event in September for which Hsia reportedly raised $5,000 in unlawful Temple donations. (note - 128) Los Angeles County Supervisor Don Knabe and Senator Edward Kennedy also each received $3,000 in laundered Temple donations arranged by Hsia in 1995. (note - 129)
128 See Ex. 96 (IBPS check #2727 for $2,500 to Hsiu Chu Lin on September 20, 1995; IBPS check #2729 for $2,500 to cash, endorsed on reverse by what appears to be the name ''Tong Sew Long''; Jou Sheng bank records for 09/09/95 through 10/10/95 showing deposit of $2,500 on September 22, 1995 and debit of $2,500 on September 28 with cashing of check #215). (On their ''memo'' lines, the IBPS check to Tong Sew Long bears the Chinese characters for ''public relations''--the term Maria Hsia used for political fundraising. See Yi Chu deposition, p. 106. The check to Hsiu Chu Lin is strangely annotated with Chineses characters and the English phrase ''birthday gift.'') According to the Temple's attorneys, at least two additional $2,500 checks were filled out by Fo Kuang Shan monastics in connection with this event--but the payee line was left blank and Maria Hsia subsequently diverted it for her own purposes, filling it out not to the originally-intended political recipient but to a company called Shen He International, Inc. See Ex. (note - 97(Gin F.J. Chen check #405 for $2,500 on September 20, 1995; Jou Sheng check #215 for $2,500 on September 20, 1995; IBPS check #2728 for $2,500 to Jou Sheng on September 20, 1995).
129 See Ex. 98 (Shiwen W. Teh a.k.a. Shiwen Wang check #1772 for $1,500 to Kanabe for Supervisor on October 25, 1995; Knabe for Supervisor, list of Monetary Contributions Received for 10/01/95 through 12/31/95 period, indicating $1,500 contributions from Hsiu Chu Lin and Shiwen Teh, both recorded on November 11, 1995; IBPS check #2846 for $1,500 to cash, endorsed on reverse by Melissa Wang [a.k.a. Shiwen Teh] on October 24, 1995; IBPS check #2847 for $1,500 to Hsiu Chu Lin on October 24, 1995; Federal Election Commission, Selected Receipts & Expenditures (95 96), showing $1,500 in contributions on December 1, 1995 from Hsiu-Chu Lin and Shiwen W. Teh; Hsiu Chu Lin check #623 for $1,500 to Edward M. Kennedy; Shiwen W. Teh a.k.a. Shiwen Wang check #1776 for $1,500 to Edward M. Kennedy on November 13, 1995; IBPS check #2923 for $1,500 to Melissa Wang [a.k.a. Shiwen Teh] on November 10, 1995; IBPS check #2924 for $1,500 to Hsiu Chu Lin on November 10, 1995).
As noted, however, Hsia's fundraising scheme for funneling Temple money through ''straw donors'' expanded dramatically in 1996 after John Huang went to work at the DNC and began to organize Democratic fundraisers among California's Asian community. It was not by coincidence, therefore, that Hsia's biggest foray yet into Temple donation-laundering occurred in conjunction with the first significant event Huang organized for the DNC: a fundraiser with President Clinton at the Hay-Adams Hotel in Washington in February 1996. For this event, Hsia telephoned Man Ho at the Temple to ask for $25,000 in contributions, 130 an amount which was duly collected from nine monastic straw donors who were thereafter reimbursed. (note - 131) Don Knabe also continued to receive the Temple's support during 1996. At the end of February, Hsia made a $1,500 donation to Don Knabe's campaign, being duly reimbursed by the Temple for her pains. (note - 132)
130Man Ho deposition, pp. 196 97; Yi Chu deposition, pp. 69 73.
131 See Ex. 99 (DNC Check Tracking Form for Hsiu Chu Lin check #667 for $3,000 to DNC on February 17, 1996; IBPS check #3286 for $3,000 to Hsiu Chu Lin on February 14, 1996; DNC Check Tracking Form for Jou Sheng check #223 for $3,000 to DNC on February 16, 1996; IBPS check #3294 for $3,000 to Jou Sheng on February 16, 1996; DNC Check Tracking Form for Pi-Hsia Hsiao check #194 for $2,500 to DNC on February 16, 1996; IBPS check #3300 for $2,500 to Pi-Hsia Hsiao on February 16, 1996; DNC Check Tracking Form for Suh-Jen Wu check #107 for $3,000 to DNC on February 16, 1996; IBPS check #3298 for $3,000 to Suh-Jen Wu on February 16, 1996; DNC Check Tracking Form for Hsing Kuang Shih check #600 for $3,000 to DNC on February 16, 1996; IBPS check #3295 for $3,000 to Hsin Kuang Shih on February 16, 1996; DNC Check Tracking Form for Gin F.J. Chen check #486 for $3,000 to DNC on February 17, 1996; IBPS check #3299 for $3,000 to Gin F.J. Chen on February 16, 1996; DNC Check Tracking Form for Hsin Cheng Shih check #137 for $3,000 to DNC on February 19, 1996; IBPS check #3297 for $3,000 to Hsing Cheng Shih on February 16, 1996; DNC Finance Executive Summary of $2,500 contribution from Hsiao Jie Su on February 19, 1996; IBPS check #3301 for $2,500 to Hsiao Jie Su on February 16, 1996; Hsiao Jie Su check #304 for $2,500 to DNC; DNC Check Tracking Form for Jen Chin Hsueh a.k.a. Gary Hsueh check #269 for $2,000 to DNC on February 16, 1996; IBPS check #3296 for $2,000 to Jen-Chin Hsueh on February 16, 1996. The Temple's computerized accounting records list this series of payments by consecutively numbered checks as ''No Name'' payments. See Hsi Lai Temple, Transaction Detail by Account (February 1996) (Ex. 100).
132Ex. 101 (IBPS check #3318 for $1,500 to Maria Hsia on February 29, 1996 with ''memo'' notation apparently reading ''re: contribution of Don Knabe'' [sic]; Knabe for Supervisor, List of Monetary Contributions Received for period 02/11/96 through 03/09/96, indicating $1,500 contribution recorded on March 7, 1996).
At least four additional episodes of donation-laundering, occurred between the April 1996 event and the general elections in November 1996. In July 1996, Hsia contacted Man Ho at the Temple, informing the nun that Hsia would need $50,000 in order to purchase two tickets to an upcoming fundraising luncheon with President Clinton at a private home. Hsia subsequently changed her plans, however, deciding instead upon a less expensive $5,000-per-person dinner at the Century Plaza Hotel. (note - 133)In the end, two Temple monastics donated $5,000 each for the Century Plaza event,--thereby making it possible for Hsia to become one of its co-chairs, a status contingent upon raising $10,000 134 --and were reimbursed by the Temple. (note - 135)
133Man Ho deposition, pp. 202 06; Yi Chu deposition, pp. 75 76.
134 See Invitation to July 22, 1996 Presidential Gala (undated) (Ex. 102) (noting that status of ''Co-Chair for the Presidential Gala'' requires one personally to contribute $5,000 or to raise $10,000).
135Ex. 103 (Bih-Yueh Jeng check #158 for $5,00 to DNC on July 22, 1996; Wang Chi Rung check #135 for $5,000 to DNC on July 22, 1996; IBPS check #3894 for $5,000 to Wang Chi Rung on July 17, 1996; IBPS check #3890 for $5,000 to Bih-Yueh Jeng on July 17, 1996).
In September 1996, two Temple monastics donated a total of some $6,500 to the DNC and were reimbursed by the Temple. (note - 136) Also that month, Hsia and her assistant, Matthew Gorman, arranged for the nun Pi-Hsia Hsiao to donate $1,000 to Don Knabe's re-election campaign, 137 a donation which was reimbursed by the Temple on the same day it was made. (note - 138) Finally, Hsia arranged for $5,000 in Temple funds to be laundered to the campaign of Representative Patrick Kennedy for a fundraiser held in Los Angeles on October 5, 1996. For this event, the occasion on which an exasperated Yi Chu finally refused to arrange to funnel the money through monastic ''straw donors'' (note - 139) --Hsia used blank Temple checks to reimburse herself and four friends for their $1,000 contributions to Kennedy's campaign. (note - 140) These laundered donations--along with another $100 check from Hsia's friend Richard Choi--were handed to Rep. Kennedy and a campaign aide as they emerged back onto the street at the end of a visit to the Hsi Lai Temple on October 5. (note - 141)
136Ex. 104 (FECInfo database printout of individual contributor data,showing $1,500 contribution to DNC from Hsiu Chu Lin on October 2, 1996; IBPS check #4119 for $1,500 to Hsiu Chu Lin). According to Yi Chu, Chee Kien Koh (a.k.a the Rev. Hai Kai) also donated to the DNC at this time, being reimbursed in cash ($3,000) and with a check made out to cash ($2,000). See Yi Chu deposition, pp. 79 82; IBPS check #4118 for $2,000 to cash, with ''memo'' notation reading ''Chee Kien Koh'' (Ex. 105). It may be, however, that Koh failed to pass the $2,000 on to its intended political recipient; he returned $2,000 to the Temple in two $1,000 payments in December 1996 and January 1997. See IBPS, Chee Kien Koh deposit check records (Ex. 106).
137Ex. 107 Matthew Gorman, letter to Peter Kelly, Sept. 18, 1996 [forwarding Pi-Hsia Hsiao check #197 for $1,000 to Don Knabe for L.A. County Supervisor dated September 18, 1996]; Knabe for Supervisor, List of Monetary Contributions received for period 10/01/96 through 10/19/96 listing $1,000 contribution from Pi-Hsia Hsiao). Pi-Hsia Hsiao's check was filled out improperly, however, and had to be reissued. See Matthew Gorman, letter to Dardy Chen, Oct. 8, 1996 (Ex. 108) (forwarding reissued check, also dated September 18, 1996).
138IBPS check #4120 to Pi-Hsia Hsiao for $1,000 on September 18, 1996 (Ex. 109).
139 See Yi Chu testimony, p. 48.
140The other reimbursees were Hilary Goldstone and Donald Burns, two Los Angeles attorneys and longtime Kennedy family fundraisers, as well as Hsia's business colleague Stephen Zhou and his wife May Lin Zhou. See Ex. 110 (Federal Election Commission, Selected List of Receipts & Expenditures [95 96], listing $1,000 contributions on October 5, 1996 by Burns, Goldstone, Hsia, and the Zhous; IBPS check #4193 for $1,000 to Hilary Goldstone on October 5, 1996; IBPS check #4194 for $1,000 to Donald Burns on October 5, 1996; IBPS check #4195 for $1,000 to Maria Hsia on October 5, 1996; IBPS check #4196 for $1,000 to May Lin Zhou on October 5, 1996; IBPS check #4197 for $1,000 to Stephen Zhou on October 5, 1996).
141Having received this money just outside the door of the Temple apparently enabled Representative Kennedy to claim later that ''our story could not be compared to the vice president's because we never did a fundraiser at the temple.'' See John Mulligan, ''Grand Jury probes Buddhist temple fundraising,'' Providence Journal-Bulletin, Oct. 20, 1997, pp. A1 & A6; John Mulligan, ''Kennedy explains his rationale in returning money raised at temple,'' Providence Journal-Bulletin, Sept. 9, 1997, p. A4. All of these funds have apparently been returned.
Counting the Temple fundraiser in April 1996, which yielded at least $65,000 in unlawful Temple donations, this elaborate system of donation-laundering, in which Temple officials marshaled funds to political candidates and causes chosen by Maria Hsia, may ultimately have funneled $146,400 to various U.S. political candidates. Of this total, some $116,500 went to the DNC in support of the Clinton/Gore ticket.
III. THE HSI LAI TEMPLE FUNDRAISER OF APRIL 29, 1996
The idea to hold a DNC fundraising event at the Hsi Lai Temple appears to have had its beginnings in March 1996, when Hsia persuaded Venerable Master Hsing Yun to meet with Vice President Gore by visiting the White House. Although Temple officials apparently understood ahead of time that some White House trip was in the offing, arrangements for this visit seem to have been hastily concluded at the last minute while Hsing Yun and a delegation of Temple monastics were in New York City on other business. (note - 142) On March 14, 1996, Hsing Yun received a telephone call from Hsia in California, informing him that the White House meeting had finally been arranged. Temple administrator Man Ho thereupon made flight arrangements to take Hsing Yun's delegation to Washington the next day, and obtained for the White House the social security numbers of those who would meet with the Vice President. (note - 143) The Master was reportedly initially reluctant to rearrange his schedule in order to accommodate this last-minute change, but he was ultimately persuaded by Hsia's entreaties and by those of former Temple abbess Hsing Kuang Shih enlisted by Hsia to help in this regard. (note - 144)
142Man Ho deposition, pp. 94 95 & 101.
143 Id., pp. 88 96 & 110.
144Man Ho deposition, p. 96; see also Transcript of Hsing Yun interview by Governmental Affairs Committee Staff, June 17, 1997, p. (note - 2) (Ex. 112) (recounting that Hsia had called him in New York to urge that he meet with Gore, and that although ''reluctant to go'' Hsing Yun has ''said, 'O.K., I'll go.' ''). (This transcription of the Committee staff's interview with Hsing Yun was transcribed by Stuart Chandler, who attended the meeting apparently on behalf of the Temple's attorneys.)
John Huang played the central role in setting up the March 15 meeting with Vice President Gore. Even before Hsing Yun's delegation left for New York on March 10, Huang had telephoned Man Ho in order to obtain the Master's social security number for the anticipated White House visit. 145 It was Huang who requested the Hsing Yun meeting, 146 and he both worked with Gore scheduler Kim Tilley in arranging it 147 and wrote the Vice President's briefing notes. (note - 148)
145Man Ho deposition, p. 99. Maria Hsia called Man Ho later--when the Temple delegation was in New York--to obtain social security numbers from the other members of the delegation who would be visiting. Id., p. 110.
146John Huang, memorandum to Albert Gore, March 15, 1996 (describing meeting as having been ''requested by John Huang''). Hsing Yun suggested that the meeting had been the idea of John Huang and Maria Hsia. See Transcription of Hsing Yun interview, p. 2.
147 See John Huang, memorandum to Kim Tilley, April 11, 1996 (Ex. 113) (''You know we have together arranged Master Hsing Yun to visit the Vice President Gore [sic] in the White House in March of this year.''). The Vice President's schedule also listed John Huang as the staff contact for the Hsing Yun meeting. Gore schedule for March 15, 1996 (Ex. 114).
148John Huang, fax transmission to Eric Anderson, March 15, 1996 (Ex. 115) (forwarding briefing notes for Vice President ''prepared by John Huang'').
On the morning before the March 15 meeting, Hsia spoke personally with Vice President Gore by telephone from the delegation's room at the Hay-Adams Hotel. Although the Vice President had already agreed to the meeting, and the Temple delegation was at that point waiting at their hotel, the Vice President's staff had become concerned over the potential political implications of a visit from Hsing Yun. Taiwan was then in the midst of its 1996 presidential election campaign, which involved, among others, an independent Buddhist candidate named Lian Chien, who had been endorsed by Venerable Master Hsing Yun. Vice President Gore's foreign policy advisors worried that meeting Hsing Yun could be seen as an implicit endorsement of Dr. Chien, and feared that the Master would somehow interject Taiwanese politics into the White House meeting. (note - 149) As Gore national security staffer John Norris later recalled,
149Man Ho deposition, pp. 106 07; Deposition of Kimberly Tilley, June 23, 1997, p. 138. After we became aware of the scheduling proposal [for the Hsing Yun meeting], I checked with State and NSC (Taiwan Coordination Staff) to get information on Hsing Yun's background. Neither office thought there was a high risk that the meeting would lead to an incident in our relations with either China or Taiwan. (note - 150)
150John Norris, memorandum, Oct. 16, 1996 (Ex. 116) (recounting ''my recollection of the two VP events involving Hsing Yun, the Taiwan Buddhist leader, and the DNC''). So concerned was Vice President Gore that despite having received such a sanguine assessment from the State Department and the NSC, he called Hsia personally at the Hay-Adams for additional reassurances. As recounted by Man Ho, who was in the room as Hsia spoke with him, the Vice President ''was afraid that [M]aster might talk to him about political issues or [M]aster might bring some message [from] Lian Chen [sic].'' Hsia assured Gore that Hsing Yun ''was not going to talk [about] any political issue with the Vice President.'' 151 The group then went to the White House to meet with Vice President Gore, leaving Man Ho and one Temple devotee behind at the hotel. (note - 152)
151Man Ho deposition, pp. 105 07; see also Ex. 116 (''[Y]ou or (Bill [Wise]) expressed concern about the sensitivities to Scheduling. As a result of those conversations, Hsia called the VP and assured him the meeting would be nothing more than a courtesy call.''). Tilley deposition, pp. 139 40 (recalling hearing about a talk between Gore and Maria Hsia).
152Man Ho deposition, p. 111. As used in this report, ''devotees'' of the Hsi Lai Temple are lay persons who nonetheless worship there regularly and who take part in various Temple activities. By contrast, Temple ''monastics'' are those who formally take religious vows and join the Fo Kuang Shan order itself ( i.e., monks and nuns)--shaving their heads, adopting distinctive monastic clothing, and usually living in the Temple complex.
The meeting involved little more than exchanges of greetings and pleasantries and a ''photo op'' with the Vice President. Hsing Yun, accompanied by three other Temple monastics 153 as well as both Hsia and Huang, met with the Vice President for approximately ten minutes. (note - 154) At the end of this brief meeting, the Master invited Gore to visit the Hsi Lai Temple. (note - 155) As to when this visit might occur, Hsing Yun told the Committee staff that Gore had indicated that he would be in Los Angeles at some point within the next six or seven weeks, i.e. in late April 1996. (note - 156)
153Yumei Yang, Ke-Chun Hong, and Abbess Suh-Jen Wu (a.k.a. Tzu Jung).
154Ex. 113; Ex. 114.
155Ex. 112, pp. 4 5; see also Ex. 113.
156Memorandum of Interview of Hsing Yun, June 17, 1997, p. 2 (''At the close of this meeting the Master invited Gore to visit the Hsi Lai temple in California. In reply, Gore indicated that he would be traveling to California 'in the near future' and would be glad to accept the invitation. No specific date was discussed but the Master recalled that Gore indicated he would be in LA within 6 7 weeks--that is, late April.''). (In contrast to the document prepared by Chandler purporting to be a near-verbatim transcription of the interview, this memorandum was prepared by Governmental Affairs Committee Staff.)
Within a week of the White House meeting, Maria Hsia sent a letter to Leon Fuerth at the White House, advising him that ''Master Hsing Yun . . . could be very helpful for Vice President Gore's re-election.'' (note - 157) The next day, Hsia wrote the Vice President himself, informing him that
157Maria Hsia, letter to Leon Forth [sic], March 22, 1996 (and earlier drafts dated March 20 & 22) (Ex. 117); see also Progress Sheet from Hsia & Associates (Ex. 118) (indicating ''sent final draft letters to Gore & Forth [sic]'' on March 24, 1996). John Huang has asked me to help with organizing a fund-raising lunch event, with your anticipated presence, on behalf of the local Chinese community. After the lunch, we will attend a rally at the Hsi Lai Temple where you will have the opportunity to meet representatives from the Asian-American community to visit again with Master Hsing Yun. The even is tentatively scheduled for April 29. . . . (note - 158)
158Maria Hsia, letter to Albert Gore, dated March 23, 1996 (and earlier drafts dated March 20 & 23) (Ex. 119). It should be noted, however, that neither Hsia's March 22 letter to Feurth nor her March 23 letter to the Vice President was produced to the Committee by the White House in the voluminous Temple-related records delivered to the Committee pursuant to subpoena. Though this letter did not make clear whether the ''fund-raising lunch event'' being organized by Huang and Hsia would take place at the Temple or at some other unspecified location, unambiguous arrangements were worked out over the next few days to have both the fundraising luncheon and the rally at the Temple. By April 4, the DNC has apparently prepared invitations to a Vice Presidential luncheon at the Hsi Lai Temple, 159 and Hsia's assistant Gorman had opened a file specifically identifying April 29, 1996 as the date of the Vice President's anticipated visit. This file was entitled ''Vice President Gore Hsi Lai event April 29, 1996--DNC Fundraiser.'' (note - 160) By April 8, the Vice Presidential Protective Division of the U.S. Secret Service had begun planning for Gore's April 29 luncheon in Los Angeles. (note - 161)
159Maria Hsia, fax transmission to Ted Marino, April 4, 1996 (Ex. 120) (forwarding invitation on DNC letterhead for Vice Presidential event at Hsi Lai Temple).
160Ex. 121 (Photocopy of file header opened on April 4, 1996; Maria Hsia, memorandum to Matthew Gorman of April 4, 1996 instructing him to ''open file under V.P. Gore Hsi Lai Temple Visit 4/29/96''); Gorman deposition, pp. 20 22 (confirming opening file on April 4, 1996).
161U.S. Secret Service, VPPD Scheduling Document, April 8, 1996 (Ex. 122) (including William Pickle, letter to Sen. Fred Thompson, Sept. 2, 1997 [explaining document]).
In late March 1996, Hsia notified the Master and others at the Temple that the Vice President would visit on April 29, 1996. Immediately, Hsia set up meetings to plan the event. Hsia requested, and it was accordingly decided that a luncheon would be served in the Temple's dining hall. (note - 162) Both Man Ho and Yi Chu testified that in one of these early planning meetings at the Temple, the Abbess told to the monastics in attendance that it would be ''acceptable'' or ''appropriate'' for the monastics to contact devotees of the Temple to indicate that they could attend the luncheon with the Vice President and, for $5,000, have their photograph taken with him. (note - 163)
162Man Ho deposition, pp. 117 119.
163Man Ho testimony, pp. 27 28; see also Man Ho deposition, pp. 125 31. In her deposition testimony, Man Ho recalled that the Abbess might perhaps have said that the price for a photograph was $5,000 per couple. Nor is it clear who suggested to the Abbess that she encourage contributions in connection with the event, or how she arrived at this $5,000 figure.
After one or two early planning meetings at the Temple, and early in the month of April, both the Abbess and Hsia left the U.S. for Taiwan, where they remained until very shortly before the April 29 event. In their stead, Hsia and the Abbess left Matt Gorman and Man Ho, their respective assistants, to take care of the day-to-day planning and preparation for the event. (note - 164) Most of Gorman's responsibilities consisted of arranging for the invitation of special VIP guests, who did not have to pay to attend the DNC fundraiser--at Hsia's direction. (note - 165) Among the nonpaying guests Hsia invited to the event were two senior officials from the INS, Joseph Thomas and Daniel Hesse, and a federal judge from Los Angeles, Robert Tagasuki. (note - 166) The VIP guest list also included Monte Perez, chairman of the ''Nationwide Citizenship Association,'' and Tom Byun, who headed the ''Radio Korea Citizenship Nationwide Program.'' (note - 167)
164Man Ho testimony, pp. 29 30; Man Ho deposition, pp. 132 33; see also Gorman deposition, pp. 23 & 25.
165Gorman deposition, pp. 22 25.
166These three men were to have their invitations specially hand-delivered. See Ex. 123 (Matthew Gorman, fax transmission to Richard Choi, April 22, 1996 (forwarding to Choi copies of invitations that were to be hand delivered to Thomas, Hesse, and Tagasuki); Matthew Gorman, fax transmission to Man Ho, April 12, 1996 (advising Man Ho that Thomas, Hesse, and Tagasuki will attend as ''V.I.P. guests''). It is not clear, however, that Judge Tagasuki actually attended. Senator Daniel Inouye and Congressman Matthew Martinez were also invited, but neither official attended. See Ex. 124 (Matthew Gorman, fax transmission to Mary Lou, April 12, 1996 [inviting Inouye]; Matthew Gorman, fax transmission to Rev. Man Ho, April 12, 1996 [containing invitation for Martinez]).
167 See Ex. 125 (Richard J. Soon Choi, letter to Matthew Gorman, April 24, 1996 [responding to confirm acceptance of invitation by Perez and Byun]; Matthew Gorman, fax transmission to Richard Choi, April 24, 1996 [advising Man Ho of attendance of Byun and Perez)].
At some point in mid- or late-April, Hsia telephoned Gorman in order to request that he solicit money from a number of individuals for the Gore luncheon. Many of these individuals apparently did not speak English well, if at all, and Gorman left the solicitation of these persons to another Hsia & Associates employee, Betty Luk, because he did not speak Chinese particularly well. (note - 168) Among these persons were Huang Guang Miao, president of the U.S. subsidiary of a Chinese company, and Joseph Chen, 169 the head of a Taoist religious organization called the Great Tao Foundation of America and secretary-general of the World I-Kuan Tao Headquarters in Taiwan. (note - 170)
168Gorman deposition, pp. 47 48; Matthew Gorman, memorandum to Betty Luk (Ex. 126) (giving list of names for solicitation: ''Professor Lo,'' Jennifer Tsai, Huang Guang Miao, Celia Wu, Joseph Chen, Zhou Buo, Chan Ya Shery, & Jeffrey Lin).
169Chan had written John Huang earlier in April to ask if Vice President Gore could visit the anniversary celebrations of the Great Tao Foundation after stopping at the Hsi Lai Temple on April 29. ''If you could make arrangements so that the vice-president after the luncheon at the Hsi Lai Temple could say a few congratulatory remarks at our ceremony between 2:00 and 2:30 P.M., and pose for photos with all attending Taoists,'' Chen wrote, ''the Great Tao Foundation will respectfully donate $25,000 toward the campaign funds.'' Joseph Chen, letter to John Huang, April 10, 1996 (Ex. 127) [translated by Michael Yan for the Governmental Affairs Committee]. The Vice President did not ultimately attend Chen's event on April 29, 1996, but Maria Hsia did arrange to bring Chen to an event with President Clinton and Vice President Gore in Los Angeles in September 1995. See Maria Hsia, letter to Joseph Chen, Sept. 19, 1995 (Ex. 128) (forwarding details of event to Chen, with handwritten note ''Thank you very much for everything that you've done!'').
170 See generally Gorman deposition, pp. 49 52.
Gorman was not the only person soliciting funds for the Vice President's Temple fundraiser, however. In addition to funds solicited independently by Huang and perhaps Hsia, 171 Temple monastics, acting on the suggestion by Abbess Tzu Jung that it would be ''appropriate'' for them to do so, solicited a number of donations to the DNC from Temple devotees in advance of the Vice President's visit. The checks thereby obtained totaled $32,500. (note - 172)
171 See infra note 202.
172 See Ex. 129 (Photocopied checks from files of Hsia & Associates, reproducing, inter alia : $5,000 check from K-Stone Industries, Ltd.; $5,000 check from Micro International U.S.A., Inc.; $7,500 check from Ying-Chiu Tien; and $2,500 check from Min Hsiang Teng; $5,000 check from Shu Woei Huang and Jan Yueh Lian Huang; $5,000 check from Henry J. Chen & Jessie F. Chen; $2,500 check from Marina Chiu); see also Man Ho deposition, pp. 159 60 (recalling that ''Chiu Tien'' and Marina Chu were on list summarizing Temple-solicited pre-event donations).
In addition to money openly raised from Temple devotees, Man Ho and Yi Chu also helped arrange for two devotees anonymously to give a total of $10,000 in cash to the DNC. This money was deposited by the two anonymous donors into the Temple's bank account, and three Temple monastics were chosen to make corresponding contributions to the DNC. 173 These three nuns were thereupon reimbursed by Yi Chu out of the Temple's general expenses account. (note - 174)
173These persons were Jou Sheng, Shiwen The (a.k.a. Melissa Wang), and Hsin Cheng Shih. See Yi Chu deposition, pp. 94 95 & 96 98; Man Ho deposition, pp. 149 50. At least two of them, Jou Sheng and Hsin Cheng Shih, are Fo Kuang Shan nuns.
174 See Ex. 130 (DNC Check Tracking Form for Jou Sheng check #227 for $5,000 to DNC on April 16, 1996; IBPS check #3523 for $5,000 to Jou Sheng on April 16, 1996; DNC Check Tracking Form for Shiwen Teh check #1808 for $2,800 to DNC on April 16, 1996; IBPS check $3521 for $2,800 to Melissa Wang [a.k.a. Shiwen Teh] on April 15, 1996; DNC Check Tracking Form for Hsin Cheng Shih check $141 for $2,200 to DNC on April 18, 1996; Hsing Cheng Shih bank records for period 03/21/96 through 04/19/96 [indicating cash deposit of $3,000 on April 18, 1966]); Yi Chu deposition, pp. 100 01 (confirming reimbursement of these three individuals). Each of the DNC check tracking forms for these straw donations credit Hsia with having solicited the contribution.
Also as part of the preparations for the Vice President's fundraiser, Huang visited the Hsi Lai Temple on three different occasions during April 1996 prior to Gore's arrival. On the last of these pre-event visits, on April 28, the day before the luncheon, Huang, Hsia, and DNC fundraiser Maeley Tom worked together in a room at the Temple, using their cellular telephones to call guests and potential guests for the next day's event. As Gorman recalled it, they spoke to these persons in Chinese, and though he was far from fluent, My impression was that they were kind of soliciting contributions, soliciting guests maybe. I got the feeling they were kind of--they were kind of urgent in trying to get like as many people as possible. Maybe they had not gotten as much--raised as much contributions [sic] as they'd wanted. . . . (note - 175)
175Gorman deposition, pp. 77 78; see also Ex. 87, p. 2, 12. At one point, Huang's telephone ran out of battery power, and he began to pick up a nearby wired telephone--only to be stopped by Maeley Tom, who admonished him that he should not use the Temple's telephones. 176
176Gorman deposition, pp. 78 79. Hsia had previously warned that ''the telephones at the Hsi Lai Temple were not to be used for 'political purposes' because this would jeopardize the Temple's non-profit (tax exempt) status.'' Ex. 87, p. 2, 11; cf. infra text accompanying note 212 (discussing tax exempt status of Temple).
During this last-minute telephone effort by Huang, Hsia, and Tom, Man Ho delivered to Huang a list of those guests Temple officials expected to attend the fundraiser. Next to each name was a notation of the amount of money each person had, or was expected to, contribute to the DNC. When Huang saw the list, he asked Man Ho if she knew of anyone else who would like to attend the luncheon for $2,500. In response, Man Ho called a friend, Catherine Chen, who agreed to contribute $2,500. (note - 177) On top of the donations solicited by monastics from Temple devotees, and the illegally laundered $10,000 in anonymous contributions described above, Chen's donation brought the total raised at the Temple prior to Gore's visit to $45,000. (note - 178)
177Man Ho deposition, pp. 143 47 (discussing giving list to Huang and identifying solicitation of Catherine Chen, ''Bill Chen's wife,'' as the subsequent $2,500 donor); Yuh How Bill Chen and Nancy Kainan Mao check #959 (Ex. 131). Catherine Chen's $2,500 check bore the name of her husband, Bill Chen, as well as that of ''Nancy Kainan Mao.'' This suggests that Catherine Chen is the same ''Nancy Mao'' who was apparently reimbursed by the Temple for a donation made in early 1994. See supra Note 124.
178Man Ho deposition, p. 148.
The Vice President arrived at the Temple at approximately 12:30 p.m. on April 29. A throng of invitees and a local high school band were outside to meet him. Inside the entrance hall, Hsia, Huang, Congressman Bob Matsui, and Donald Fowler were among the official greeters. After meeting briefly in a holding room with Master Hsing Yun, the Vice President walked up the Temple's courtyard, between a phalanx of monastics, to the Temple's Buddha shrine, to which the Vice President made a flower offering. From there, the Vice President was escorted downstairs to have his photograph taken with VIP attendees and those who had contributed in connection with the event. (note - 179)
179 See generally Man Ho deposition, pp. 176 82; Ex. 122, pp. 11 13.
At lunch in the Temple's dining hall, the Vice President sat at the head table with Master Hsing Yun, Hsia, and Ted Sioeng, among others. (note - 180) John Huang apparently did not sit at one of the tables, instead circulating amongst the tables working with Temple officials and Gore's ''advance'' team to ensure that things ran smoothly. (note - 181) As part of a brief series of speeches after lunch that included remarks by Hsing Yun, Huang and Fowler, Congressman Matsui, who then also served as the DNC's treasurer, introduced Vice President Gore--who spoke for a few minutes to the assembled guests as Hsia interpreted his comments into Chinese. (note - 182) Immediately following his speech, the Vice President posed outside with all Temple monastics, and left the Temple at about 2:00 p.m. From there, the Vice President departed for the airport, flying on Air Force Two to San Jose, and ending up at a DNC fundraising dinner that evening at a private home in Los Altos Hills, California. (note - 183)
180According to the seating chart, at Gore's table were seated Maria Hsia, Ted Sioeng, Don Knabe, Joseph Thomas, Yvonne Burke, and Gary Shaw, among others. Dining Hall Guest List--April 29th Vice President Gore Event (Ex. 132).
181 See, e.g., Photograph of Vice President Gore at lunch, April 29, 1996 [produced by Temple to the Committee] (seated with Hsing Yun, Maria Hsia, and Ted Sioeng, with Huang in background talking to Bain Ennis of the Vice President's advance staff).
183 Id., pp. 12 17. There were several other quick stops after the Vice President flew to San Jose before his motorcade arrived at the home of George and Judy Marcus in Los Altos Hills for this event.
At around 3:00 p.m., following the Vice President's departure, the Master and Hsia held a press conference at the Temple. A number of reporters were angry because they had not been permitted to attend the event itself; some also questioned the propriety of holding a political event at the Temple. According to Man Ho, some reporters say that it was not proper to have this type of luncheon at the temple, but Maria told them that someone has checked with the White House and [they] say that it's okay to have luncheon at the temple. (note - 184)
184Man Ho deposition, pp. 182 83.
Even on April 29, it had become apparent that the Hsi Lai Temple fundraiser had not raised as much money as Huang and Hsia had hoped. That evening, after the Vice President's departure, Gorman spoke briefly with Hsia at the Temple while she awaited an audience with Venerable Master Hsing Yun. Hsia ''seemed disappointed not so much as to how the event itself went, but that they had not been able to raise the amount of money that they wanted to raise.'' (note - 185) As Gorman recalled,
185Gorman deposition, p. 86. After the event, I asked Ms. Hsia how she felt the Vice Presidential visit had gone. She responded to the effect that they didn't raise as much [money] as they wanted, but she had talked to the Master and he had said ''he would take care of it.'' (note - 186)
186Ex. 87, p. 3, 14. This need for more DNC donations, however, became an urgent priority the next day when DNC officials in Washington began to pressure Huang for more money.
As DNC Finance Director Richard Sullivan later recalled it, he telephoned Huang the day after the Gore luncheon as part of his ''general practice'' of trying to ''rally the troops at the end of the month and ask them to get in money.'' He ''remember[ed] having a conversation with John'' in which he told Huang that ''we need you to get some money in.'' (note - 187) According to Sullivan,
187Deposition of Richard Sullivan, June 25, 1997, pp. 41 42. I remember being disappointed . . . I remember just fine, being somewhat personally disappointed--you know, between San Jose and the fact that it [had been] so important to somebody out there that the event be at the temple, that . . . you would have thought . . . we would get a big contribution out of somebody. (note - 188)
188 Id., pp. 46 47. Sullivan had ''expected that they were going to make some big contributions.'' ''I was expecting . . . maybe some 15s and 20s''(189( -- i.e., individual contributions of $15,000 or $20,000 each. Since this had not occurred, Sullivan asked Huang
189 Id., pp. 50 51. Can you get some [more] funds in? Can you send some money in? Don't you have some outstanding money out? . . . I may have said, John, get some money in from your people in Los Angeles, get some money . . . . I probably did say, John, get some California money in. (note - 190)
190 Id., pp. 45 46.
Huang apparently wasted little time in passing this message on to Hsia and to the Temple, for during a break in a seminar program being conducted for the assembled monastics by Hsing Yun, Man Ho received a telephone call from Hsia informing her that Huang needed to raise more money. Huang, Hsia told her, needed another $55,000, enough to bring the total raised at the Temple to $100,000. Hsia also told Man Ho that Huang needed this money before he returned to Washington that very evening. (note - 191)
191Man Ho deposition, p. 183; Man Ho testimony, p. 41; Yi Chu testimony, pp. 42 & 4748. When Man Ho went to inform Hsing Yun and Abbess Tzu Jung of this sudden need for more money, she discovered that they had already been told. Man Ho deposition, p. 185.
Man Ho then contacted Yi Chu, telling her that ''we were a certain number [of donations] short, and she wanted me to make it up.'' What was needed, Man Ho informed her, was to add another $55,000 to the $45,000 the Temple had collected already. (note - 192) Accordingly, given the need for haste, Yi Chu approached the first monastics she saw, soliciting donations from the first 11 monks or nuns she encountered who happened to have their checkbooks with them. (note - 193) Because many of them did not have enough money to cover the $5,000 sum Yi Chu asked of them(194( --and because after 1993 it was the Temple's standard practice to reimburse monastics who made donations to political causes(195( --Yi Chu reimbursed every one of these eleven monastics. (note - 196)
192Yi Chu deposition, p. 51; Yi Chu testimony p. 43.
193Yi Chu deposition, pp. 55 56; Yi Chu testimony, p. 43.
194 See, e.g., Yi Chu deposition, p. 60; Yi Chu testimony, pp. 45 46; Siuw Moi Lian deposition, pp. 31 32; Huei-Tsan Huang deposition, pp. (note - 21)& 25.
195Yi Chu deposition, pp. 56 57.
196 See id., pp. 61 65; Yi Chu testimony, pp. 43 44 & 47 48. Some of the donors even postdated their checks to the DNC so that the check Yi Chu wrote them from the Temple's general expenses account would clear first. See e.g., Yi Chu deposition, pp. 46 47 (discussing postdated check from Siuw Moi Lian); Yi Chu testimony, pp. 45 46.
Hsing Yun was among those solicited and reimbursed in this fashion. By his own admission, in fact, the Master appears to have been well aware that in assuring Hsia that ''he would take care of'' Huang's cash shortfall, he was authorizing monastics' reimbursement for their DNC contributions. As Hsing Yun put it to Committee staff who met with him at his temple in Kiaoshung in June 1997, In [the] Hsi Lai Temple there were some monastic and lay disciples who, influenced by my own conduct, also wanted to help Mr. Gore. In truth, they had only limited funds since they ordinarily donate all of their money to Hsi Lai Temple. However, when they want to use some of it, Hsi Lai Temple ought to give it to them. Therefore, when they did not have enough money to cover the checks they were donating, I thought Hsi Lai Temple could help these disciples. (note - 197)
197Ex. 25, p. 4. ''Some devotees did not have enough money,'' he said, ''so the temple, due their past good service, when they need money the temple will give them the money they want.''(198( ''Influenced by [the Master's] own conduct'' in making a contribution that day,(199( ten other monastics joined Hsing Yun in writing $5,000 checks to the DNC--and in being reimbursed by Yi Chu for the cost of these donations. (note - 200)
198 Id., p. 8.
199 Id., p. 4.
200Ex. 133 (DNC Check Tracking Form for Shing Yun check #102 for $5,000 to DNC on April 30, 1996; IBPS check #3573 for $5,000 to Shing Yun on May 1, 1996; DNC Check Tracking Form for Man Ya Shih check #509 for $5,000 to DNC on April 30, 1996; IBPS check #3576 for $5,000 to Man Ya Shih on April 30, 1996; DNC Check Tracking Form for Hsiu Chu Lin check #702 for $5,000 to DNC on April 30, 1996; IBPS check #3581 for $5,000 to Hsiu Chu Lin on May 1, 1996; DNC Check Tracking Form for Suh-Jen Wu check #121 for $5,000 to DNC on May 1, 1996; IBPS check #3574 for $5,000 to Suh-Jen Wu on May 1, 1996; DNC Check Tracking Form for Pi-Hsia Hsiao check #195 for $5,000 to DNC on April 30, 1996; IBPS check #3571 for $5,000 to Pi-Hsia Hsiao on May 1, 1996; DNC Check Tracking Form for Siuw Moi Lian check #1016 for $5,000 to DNC dated May 6, 1996; IBPS check #3577 for $5,000 to Man Ya Shih on May 1, 1996; DNC Check Tracking Form for Hueitsan Huang check #243 for $5,000 to DNC on April 30, 1996; IBPS check #3575 for $5,000 to Hueitsan Huang on April 30, 1996; DNC Check Tracking Form for Hsiu Luan Tseng check #140 for $5,000 to DNC dated May 6, 1996; IBPS check #3572 for $5,000 to Hsiu Luan Tseng on May 1, 1996; DNC Check Tracking Form for Bor Yun Jeng check #221 for $5,000 to DNC on April 30, 1996; IBPS check #3570 for $5,000 to Bor Yun Jeng on May 1, 1996; DNC Check Tracking Form for Seow Fong Ooi check #497 for $5,000 to DNC on April 30, 1996; IBPS check #3578 for $5,000 to Seow Fong Ooi on May 1, 1996).
Hsia was at the Temple later that evening when Huang stopped by briefly to pick up the checks, before leaving for Washington. (note - 201) With this money, the amount of money raised by the Temple for the DNC by the April 29 event now totaled $100,000: $35,000 in donations solicited ahead of time by Temple monastics, $10,000 in laundered donations by anonymous devotees before the Vice Presidential luncheon, and $55,000 in laundered donations in response to Huang's request for more funds just after the event. Added to the sum Huang and perhaps others apparently solicited independently of the Temple, the Vice Presidential fundraiser raised $166,750 for the DNC. (note - 202)
201Man Ho deposition, pp. 183 84 & 187.
202Democratic National Committee, DNC Contribution Review, Feb. 1997 (Ex. 136) (excerpts), p. 4 (listing ''[t]otal raised in connection with event'' for ''Hsi Lai Temple Event'' as $166,750); cf. Man Ho deposition, p. 149 (remarks of Man Hua) (explaining that Man Ho ''doesn't know what others contribute[d]'' beyond DNC donations solicited by Temple officials). As described earlier, the Hsi Lai Temple raised at least $146,400 in illegal reimbursed contributions for local, state, and national political campaigns from 1993 through the elections of 1996. Some $116,500 of this total went directly to the DNC for events involving Bill Clinton, Hillary Clinton, and Al Gore; other recipients included Senator Ted Kennedy and Representative Patrick Kennedy. Sections 441e and 441f of Title 2 of the U.S. Code prohibit knowingly accepting such unlawful donations, and therefore presumably prohibit keeping donations that one discovers have been raised illegally. See 2 U.S.C. 441c (''It shall be unlawful . . . for any person to solicit, accept, or receive any such contribution from a foreign national.''); id. at 441f (''No person shall . . . knowingly accept a contribution made by one person in the name of another.'').
The repeated donation-laundering in which Hsia and Temple officials, and perhaps Huang, engaged clearly violated federal elections laws barring political contributions made through ''straw donors'' (note - 203) and meets the legal definition of a ''criminal conspiracy.'' (note - 204) Moreover, Temple officials have admitted that at least two of the monastics who gave money in connection with the Gore event, Chia-Hui Ho and Seow Fong Ooi, were foreign nationals prohibited from making political contributions(205( at the time they made their donations. (note - 206) Nor were these two individuals the only foreign nationals reimbursed by the Temple after making contributions to the DNC. According to her responses to a DNC telephone survey, reimbursed Temple donor Bih-Yueh Jeng was neither a U.S. citizen nor a permanent U.S. resident at the time she made her $5,000 contribution to the DNC in connection with the Presidential event in Los Angeles in July 1996. (note - 207) Since Temple officials made no efforts to ascertain the immigration status of monastics or devotees solicited for political contributions, or those selected to participate in ''straw donor'' reimbursement schemes, it may have been no more than blind luck that prevented even more foreign nationals from making donations. (note - 208)
203 2 U.S.C. 441 f (''No person shall make a contribution in the name of another person or knowingly permit his name to be used to effect such a contribution, and no person shall knowingly accept a contribution made by one person in the name of another person.'').
204 United States v. Hopkins, 916 F. 2d 207 (5th Cir. 1990) (holding that conducting donation-laundering scheme can amount to criminal conspiracy to defraud the United States and to make fraudulent statements to Federal Elections Commission in violation of 18 U.S.C. (note - 371& 1001); id. at 212 (describing elements of conspiracy, and citing United States v. Medrano, 836 F.2d 861, 863 64 (5th Cir. 1988); United States v. Colwell, 764 F.2d 1070, 1072 (5th Cir. 1985)).
205 See 2 U.S.C. 441 e(1) (''It shall be unlawful for a foreign national directly or through any other person to make any contribution of money or other thing of value, or to promise expressly or impliedly to make any such contribution, in connection with an election to any political office or in connection with any primary election, convention, or caucus held to select candidates for any political office; or for any person to solicit, accept, or receive any such contribution from a foreign national.''). The term ''foreign national'' is defined to mean persons who are neither U.S. citizens nor permanent resident aliens See 2 U.S.C. 441 e(b) (defining ''foreign national'' to exclude ''any individual who is a citizen of the United States'' and any person ''lawfully admitted for permanent residence'').
206Man Ho deposition, pp. 232 33 (identifying Chia Hui-Ho and Seow Fong Ooi as having been neither U.S. citizens nor permanent residents at time of DNC donations); Yi Chu deposition, p. 96 (similarly identifying Seow Fong Ooi); Ex. 137 (Peter Kelly, letter to Joseph Sandler, Nov. 15, 1996 [discussing Chia Hui-Ho's $5,000 contribution to DNC and noting that ''this individual's application for legal permanent residence is still pending before the Immigration and Naturalization Service'']; Immigration and Naturalization Service, approval notice for 101(a)(27)(C)(ii) special immigration [religious worker] status for Chia Hui-Ho, Oct. 7, 1996; James Robinson, letter to INS, Nov. 7, 1996 [enclosing Chia-Hui Ho's application for permanent resident status]).
207Ex. 138 (Bih-Yueh Jeng, Debevoise & Plimpton survey response via telephone interview, Dec. 17, 1996, p. DNC 1803698 [answering ''No'' to question ''Are you a United States citizen?'' and ''No'' to question ''Are you a permanent resident of the United States?'']. Immigration and Naturalization Service, Petition for a Nonimmigrant Worker, Sept. 27, 1996 [granting Bih-Yueh Jeng's petition for nonimmigrant religious worker status several months after the Temple event]).
208 See Yi Chu deposition, p. 95 (''Well, I didn't know whether contributions were prohibited from the noncitizens or nonpermanent residents. All I did was to encourage people to make donations.''). Moreover, the Temple's donation-laundering scheme raises questions as to the ultimate source of the monies that flowed into the DNC's coffers over the 1993 96 period. As noted previously, the reimbursements were all made out of the Temple's general expenses account, which in turn got its money from the account into which Buddhist devotees made donations to the Temple. Because Temple officials never screened Buddhist contributors to the Temple for U.S. citizenship or permanent resident alien status, there is no way of knowing whether or not the money that ended up being funneled to the DNC by Hsia and Huang ultimately came from foreign nationals. See id. (stating that ''[n]o attempt was ever made'' to determine whether devotees were citizens or permanent residents).
Richard Sullivan and the DNC clearly knew that it was inappropriate to have a fundraiser at the Temple. As he told John Huang when Huang first described his Temple plan, for example, ''you know, . . . you can't do a fund-raiser at a temple.'' (note - 209) Nevertheless, faced with huge pressures to raise money for the re-election of Bill Clinton and Al Gore, Sullivan let Huang continue with the event even though Huang admitted that ''he'd get money out of it'' and ''he'd get some money out of them.'' (note - 210) But the impropriety could not be erased simply because Huang promised that he would not solicit all attendees for money. (note - 211) As one of the DNC's own auditors noted after the Temple affair had begun to appear in the national press, contributions from the Temple should be returned because ''[i]t was a temple, you idiot!'' (note - 212)
209Sullivan deposition, June 25, 1997, p. 23.
210 Id., p. 24.
211 Id., pp. 24 & 26.
212Democratic National Committee, list of contributions returned since September 1996, Nov. 22, 1996 (Ex. 139) (listing $5,000 donation from ''Buddhist Temple'' and noting as reason for refund that ''It was a temple, you idiot!'').
One reason why it was wrong to hold the fundraiser there is that the Hsi Lai Temple--in its corporate incarnation as the International Buddhist Progress Society (IBPS)--is a 501(c)(3) organization for federal income tax purposes. (note - 213) Like all churches, therefore, it is prohibited by law, not to mention its own organizational charter, from engaging in political activity. As the Temple's own articles of incorporation state, ''the corporation shall not participate or intervene in any political campaign . . . on behalf of any candidate for public office.'' (note - 214) Political activity of the sort in which Temple officials engaged, e.g., donating Temple money to political campaigns and soliciting funds for such campaigns, is impermissible. Moreover, contributions made by faithful Buddhists to the Temple are tax deductible. On top of the various legal concerns already discussed herein, this raises at least two additional troubling issues.
213 See, e.g., Internal Revenue Service, Cumulative List of Organizations, vol. 1, Sept. 30, 1995, p. 1049 (Ex. 140) (listing ''International Buddhist Progress Society, Hacienda Heights, Ca.'' as tax-exempt organization). The IBPS was also exempt from California taxes as a nonprofit organization. See International Buddhist Progress Society, Statement by Domestic Nonprofit Corporation, March 15, 1996 (Ex. 141) (document signed by Hsing Huang Shin, Liang Yueh Fang, and Tsui-Hsueh Hsueh [a.k.a. Yi Chu], listing Hsia as agent for service of progress).
214International Buddhist Progress Society, Articles of Incorporation, Aug. 4, 1978, p. 1 (Ex. 142). This document was signed by three Temple officials, two of whom were Hsing Yun himself and former Temple Abbess Hsing Kuang Shih, id., p.3--both of whom were subsequently involved in unlawful Temple donation-laundering in support of various political causes.
First, the checks laundered through Temple monastics to the DNC--over $100,000 worth in 1996 alone--apparently consisted of money derived directly from tax-exempt charitable contributions made to the Temple. In essence, therefore, this amounts to taxpayer funding for political contributions to the DNC, which is clearly prohibited.
Second, this use of Temple funds perpetuated a fraud upon faithful Buddhists who donated to the Temple upon the assumption that their money would be used to advance the Temple's legitimate religious purposes and not be given to a political party. Through the Temple's donation-laundering and willingness to host political fundraisers for various candidates, however, money given by faithful devotees to the Temple was illegally diverted without their knowledge to support the re-election of Bill Clinton and Al Gore. (note - 215)
215Another potential consequence to the Temple from this violation of its Section 501(c)(3) status relates to the validity of visas and green cards Hsia obtained for Fo Kuang Shan religious workers under the terms of the Immigration Act of 1990. Because the Temple had apparently been engaged in unlawful political activity through hsia since at least 1993, it is open to question as to whether the Hsi Lai Temple qualifies as such a ''bona fide nonprofit'' organization. As Hsia's assistant Matthew Gorman recognized, political activity by the Temple might threaten the validity of all the religious worker visas and green cards obtained for Temple affiliates since 1993. See Gorman deposition, p. 75.
It is also worth noting that there is a problem here even apart from the Temple's reimbursements of DNC donors. As the Committee learned from Maura McManimon, the DNC's event coordinator for the Temple luncheon, the DNC had no expenses in organizing the Temple event apart from Huang's airfare to Los Angeles. The DNC apparently did not even give McManimon a budget for this event, and had absolutely no idea what the Temple luncheon cost because the Temple paid for everything. (note - 216) These expenditures alone amounted to a large, in-kind contribution to the DNC by the Temple.
216Deposition of Maura McManimon, July 25, 1997, pp. 49 50 & 58 59.
Significantly, the DNC did not repay the Temple for this significant in-kind contribution until the day after the first stories about the Temple affair appeared in the Wall Street Journal on October 17, 1996. 217 It was only then that the DNC decided to reimburse the Temple for the money it saved the DNC in organizing the Gore event, by sending the Temple a check for $15,000. (note - 218)
217Kuntz, supra note 1.
218The DNC's check for this reimbursement was written on the very day the first stories appeared. See Ex. 143 (Bradley Marshall, letter to Man Ho, Oct. 18, 1996, enclosing $15,000 check to cover estimated costs of April 29, 1996 event; DNC Services Corporation check #025100 for $15,000 to Buddha's Light International Association on October 17, 1996).
When press accounts of the Temple fundraiser and associated donation-laundering by the Temple began to appear in the fall of 1996, Temple officials became alarmed. Both Man Ho and Yi Chu, in fact, ''panicked'' and set about destroying and altering documents in their files which they felt were ''embarrassing.'' Man Ho destroyed a number of documents relevant to the Temple's illegal donation-laundering, including: (1) The check-request forms that Man Ho had prepared for the Abbess' signature after receiving calls from Maria Hsia requesting political contributions; (2) The list of attendees Man Ho gave to John Huang on April 28 indicating guests who would attend the Gore luncheon, who among them had agreed to donate money to the DNC, and the amount of each contribution; and (3) Most of the paperwork held at the Temple in preparation for the Vice President's visit, including invitations (including newspaper clippings of the event). (note - 219)
219 See Man Ho deposition, pp. 155 58 & 219 20 (recounting ''panic,'' ''embarrassment,'' and document destruction).
Venerable Master Hsing Yun has subsequently claimed that the destruction of these documents was merely part of an ongoing process by which the Temple would ''regularly purge old files in storage and add new ones'' and ''has nothing to do with destruction of evidence.'' (note - 220) It is clear from Man Ho's testimony, however, that this is untrue. Furthermore, when questioned by Senator Susan Collins during Committee hearings, Yi Chu admitted that the nuns' document purge was anything but ordinary:
220Hsing Yun, statement in response to Governmental Affairs Committee hearings, Sept. 6, 1997 (Ex. 144) [translated by Michael Yan for the Governmental Affairs Committee]. Senator Collins . When the press stories appeared regarding the temple fund-raiser and the reimbursements, were you worried that the negative publicity would hurt the temple's reputation? Ms. Yi-Chu . Yes. Senator Collins . And you also did not want to embarrass the Vice President or . . . Maria Hsia; is that correct? Ms. Yi-Chu . Yes. Senator Collins . So that was your motivation for making these changes and altering these documents as well as destroying other documents; is that correct? Ms. Yi-Chu . Yes. (note - 221)
221Yi Chu testimony, Sept. 4, 1997, p. 65; see also id., pp. 34 35 & 97 (confirming that motive for destruction was to avoid embarrassment).
In addition to this campaign of document destruction, Yi Chu testified that in approximately November of 1996, she modified some of the cashed Temple checks used to reimburse monastic donors on the day following the event. After stories about the Temple incident began to appear in the press, she added, often in Chinese characters, the words ''loan'' or ''Futien account'' on the previously-blank ''memo'' lines of a number of checks. (note - 222) This, she hoped, would conceal the actual origin of the reimbursements: while the checks had actually come out of the Temple's general expenses account with no expectation of repayment, she wanted to create the impression they were either ''loans'' to the monastic donors or had come from these donors' own funds held for them by the Temple in so-called Futien accounts. (note - 223)
222These altered checks were the ones produced to the Committee pursuant to its subpoena of the Temple, but the forgery can clearly be seen if one compares the altered checks produced by the Temple with photocopies kept by the bank when the checks were originally cashed in their unaltered form. Exhibit showing ''Checks as produced by Temple'' alongside ''Checks as cashed by bank'' (Ex. 145) (reproducing illustrative IBPS reimbursement checks to Hsiu Chu Lin, Hsiao Jie Su, and Seow Fong Ooi).
223 See Yi Chu deposition, pp. 47 50, 83 84, & 108 09.
Yi Chu's alteration of these checks is significant not only because of the cover-up it demonstrates, but because it emphasizes the fact that while Yi Chu could have selected to make contributions only monastics who had sufficient funds in their personal ''Futien'' accounts to cover the cost--and thereby create at least the basis for an argument that the political contributions by these monastics were voluntary ones made from personal monies--she instead followed her usual pattern of immediately reimbursing the ostensible donors from the Temple's general expenses account, which is funded with tax-deductible contributions to the Temple itself. These alterations underscore the fact that the Temple's numerous reimbursements during the 1993 96 period were not done with the donors' ''own'' money, and they make clear that Temple officials clearly understood that it was wrong to reimburse donors with the Temple's funds.
Temple monastics were also less than candid in responding to press inquiries and official investigations of the Temple affair. Man Ya Shih--whose false story about donation-laundering had helped first bring the episode to light when it was reported in the Wall Street Journal in October 1996 224 --was the worst offender in this regard. In a letter to Hsia apologizing for certain false statements she had made to the Journal and seeking Hsia's approval of a proposed written response to FEC inquiries, for example, Man Ya Shih promised Hsia that ''I will cover the fact if I did help anyone in laundering the money.'' (note - 225) Thereafter, in a signed and sworn statement to the FEC, Man Ya Shih did exactly this--swearing that no one had given her the money she used to make her $5,000 donation to the DNC. (note - 226)
224 See Kuntz, supra note 1.
225Ex. 146 (Man Ya Shih, letter to Maria Hsia, Nov. 7, 1996; Man Ya Shih, excerpt from November 7, 1996 letter to Maria Hsia translated from Chinese by Michael Yan for Governmental Affairs Committee).
226Man Ya Shih, sworn declaration to Federal Elections Commission, Nov. 30, 1996, p. 2 (Ex. 147), (''Please note that I was not given money to donate to DNC. But money given to me from the past years was used to be donated to DNC by my kind intention to support the people to elect the right persons to the Government''.) Hsia apparently also forwarded information to Man Ya Shih regarding the requirements of federal election law, and attempted to arrange for Man Ya Shih to receive legal representation from Hsia's own lawyer, James Robinson. See Ex. (note - 148) (Progress Sheet from files of Hsia & Associates [recounting Man Ya Shih inquiry about election law, apparently on Nov. 1, 1996]; Maria Hsia, fax transmission to Jim Robinson, Nov. 6, 1996 [forwarding ''Statement of Designation of Counsel'' signed by Man Ya Shih]). As the DNC attempted to assess the scope of its illegal-donation problem in late 1996 and early 1997, Hsia apparently helped a company called Matsunichi of America prepare a response to the DNC's questionnaire in which it denied that its president, Pan Su Tong, had ever made any contributions to the DNC. At the time, however, Hsia possessed both a photocopy of Pan's $5,000 check to the DNC on July 22, 1996 and a copy of the bank statement showing that it had been cashed by the DNC. Ex. 149 (Packet of materials forwarded to Matt Gorman by Matsunichi of America, including: check in name of Pan Su Tong signed by Lance Zheng; copy of bank statement for August 1996; draft letter denying contribution written on letterhead of Matsunichi of America and prepared for signature by Lance Zheng; copy of questionnaire sent to Pan by Ernst & Young on behalf of DNC).
In early 1997, Maria Hsia also played a role in coordinating monastics' responses to the Ernst & Young surveys sent to contributors by the DNC as part of their review of campaign finance problems--helping them respond to difficult questions such as who had solicited their donations and whether anyone else had provided them with money for this purpose. (note - 227)
227 See e.g., Matthew Gorman, fax transmission to Jan Yueh Lian Huang, Jan. 9, 1997 (Ex. 150) (noting that ''I will ask Ms. Hsia about item number 16.''); id. at SEN 00329 (enclosure of Ernst & Young DNC donor survey). Question 16 of Huang's survey was an inquiry as to ''who was the person who asked or solicited you to make this contribution.'' Moreover, this survey response contains a handwritten note by Matt Gorman in the response portion of Question 15--which asks ''If this money was not yours, we need to know whose mney it was. Please tell us whose money was given to the DNC and give us his/her name.'' Gorman's note, which was written in Chinese, indicates that he will ask Maria Hsia about this question. Id.: see generally Gorman deposition, p. (note - 92) (identifying authorship and content of handwritten note); Matthew Gorman, fax transmission to Maria Hsia, Jan. 11, 1997 (Ex. 151) (forwarding Huang's query about survey and requesting ''Please let me know how you suggest she should respond.''); Ex. 87, p. 3, 15 (''In late 1996 or early 1997, Ms. Hsia asked me to help any persons who had donated to the DNC in connection with the April 29, 1996 event who needed help in responding to questionnaires sent by Ernst & Young on behalf of the DNC.''). According to Gorman, he did indeed ask Hsia about Huang's responses, but was told merely to ''say whatever is true.'' Gorman deposition, p. 94. He could not remember whether he helped other donors ''coordinate'' their responses with Hsia.
Another nun, Siuw Moi Lian--who donated $5,000 to the DNC in connection with the Gore luncheon and was reimbursed by the Temple--appears to have submitted a false response to the DNC when asked about her role. When asked on behalf of the DNC by the accounting firm of Ernst & Young whether anyone had solicited her donation and what the source of the money for it had been, Siuw Moi Lian wrote ''myself.'' (note - 228
228Siuw Moi Lian response, undated (Ex. 152).
Hsia barred reporters from viewing the videotape taken by King & I Productions, videographers hired for the Vice President's Temple luncheon, including that taken of the speeches made by Vice President Gore and others to the assembled guests. (note - 229) Within two days of the luncheon, all copies of the videotape footage were gathered up from the film company and quickly shipped to Taiwan. 230 Moreover, the monastic who took the tape from the production company on May 3, 1996--a monk by the name of Man-Chin 231 --left the Fo Kuang Shan order shortly after the Committee served Temple officials with a subpoena for the videotape; he has since disappeared. 232 Despite the repeated assurances of Temple officials that they are looking for this missing tape--and despite the fact that Temple officials have used short excerpts from this tape in making a brief publicity video that appeared on the Cable News Network--the full videotape record of the event with Vice President Gore on April 29, 1996 remains hidden to this day.
229 See Memorandum of Interview of Anonymous Chinese newspaper reporter, May 16, 1997, pp. 1 2.
230Hank Tseng, letter to Christopher Ford, Aug. 27, 1997 (Ex. 153); Hearing testimony, Sept. 4, 1997, pp. 167 69 & 173 81.
231 See Ex. 153.
232Hearing testimony, Sept. 4, 1997, pp. 174 75 & 179 (remarks of Man Ho, Senator Fred Thompson, and Brian Sun).
It has continued to be difficult to establish precisely what the Vice President claims to have known about the nature of the Temple fundraiser. At first, he claimed that he believed the Temple lunch was only a ''community outreach'' event. (note - 233) Later, Vice President Gore said that he had believed it to be a ''finance-related'' event, 234 a term that the White House apparently now uses to describe a range of events including, but not limited to, fundraisers. More recently--after it became apparent to the Committee that no one at the White House or the DNC could ever recall seeing or using the term ''finance-related'' prior to the point at which the Hsi Lai Temple story first broke in the press in October 1996 235 --Vice President Gore adjusted his position again. On the day before Committee hearings on this subject, White House officials told reporters that the Vice President had actually believed it to be a ''donor-maintenance'' event, by which they apparently meant that he felt it to be an affair for DNC contributors at which money was not to be raised. (note - 236) The Vice President has said that ''no money was offered or collected or raised at the event,'' (note - 237) and he has insisted that ''[i]t was not a ticketed event.'' (note - 238) According to his spokeswoman Ginny Terzano, ''[a]ny money collected was without our knowledge.'' (note - 239)
233Albert Gore, interview by Nina Totenberg for National Public Radio, Oct. 22, 1996 (''It was billed as a community outreach event . . .'')
234 See Brian McGrory, ''Gore says he knew Buddhist event was fund-raiser; He earlier cited 'community outreach,''' Boston Globe, Jan. 15, 1997, at A9.
235According to the Vice President's scheduler Kim Tilley, in fact, the term ''Finance-related event'' was never used at all. Tilley deposition, p. 128 (''We would not call them DNC Finance-related events.'').
236 See David Stout, ''Gore's Presence at Fund-Raiser Called Innocent,'' New York Times, Sept. 3, 1997, p. A19.
237Albert Gore interview, supra note 233.
238 See Dan Balz, ''For Vice Presdent Gore, a Term of Transition,'' Washington Post, Jan. 20, 1997, p. E31.
239 See John Mintz, ''Fund-Raisers Pressured Temple After Gore Visit,'' Washington Post, June 13, 1997, p. A20.
Virtually everyone at the DNC and on the Vice President's staff, however, not only clearly understood the Hsi Lai Temple event to be a ''fundraiser,'' but also freely and repeatedly described it as such. Indeed, the Vice President himself once referred to his DNC engagement in Los Angeles that day as a ''fundraiser''--and did so at a point after which he had already accepted Hsing Yun's invitation to visit the Temple. Moreover, it is clear that both the Vice President himself and his staff members understood that whatever the event was ostensibly called , its purpose was to raise money for the DNC.
The Vice President was advised of this, for example, by Harold Ickes, who described the event's anticipated fundraising total to the Vice President on the day before the Vice President received his briefing notes from the DNC for the Temple visit. In fact, at least two of the guests who attended the event in Hacienda Heights on April 29, 1996 recall fundraising actually being discussed from the lectern--in the presence of the Vice President. While there are obvious reasons for the Vice President to wish to distance himself from the Temple event by claiming that he had no idea fundraising was involved, such a claim is improbable.
To understand what the Vice President really knew about the Temple, one must first understand the ''dire financial situation'' that faced the DNC after Republicans won majorities in Congress in 1994. (note - 240) Without vast new infusions of money, felt the Democrats in the White House, they could not afford the expensive media campaign needed to save themselves from a similar defeat in 1996. (note - 241) With this very much in mind, Vice President Gore resigned himself to a long and arduous season of fundraising, concluding that ''we can raise the money--BUT ONLY IF--the President and I actually do the events, the calls, the coffees, etc. . . . And we will have to lose considerable time to the campaign trail to do all of this fundraising.'' (note - 242)
240Deposition of David Strauss, June 30, 1997, p. 254.
241According to one DNC Trustee, for example, the DNC established a special media fund because the ''the media campaign was going to be expensive.'' Deposition of Beth Dozoretz, Sept. 2, 1997, p. 56. Ultimately, the DNC spent many millions of dollars on this campaign, which the President himself identified in videotaped comments produced to the Committee by the White House,
242Albert Gore, ''Points for Political Budget Meeting with President,'' undated, p. 4 (Ex. 154).
The DNC's April fundraiser in Los Angeles was a direct result of the fundraising campaign that grew out of the perceived importance of financing the DNC's massive media campaign on behalf of the President's re-election. Since the beginning of 1996, in fact, DNC and White House officials had been planning a fundraiser for the Vice President in April of that year. In early January, for example, Ickes sent a memorandum to the Vice President outlining the DNC's proposed events for 1996. This memorandum outlined, among other things, a plan to hold a $200,000 fundraiser for Vice President Gore in Los Angeles in April; it was to be the Vice President's only one in the city that month. (note - 243)
243This document also outlined the DNC's plan for another $200,000 April fundraiser for Gore in San Jose. This Ickes memorandum is the first planning document which the Committee has been able to locate the two April 29, 1996 fundraisers attended by the Vice President, Harold Ickes, memorandum to the President and Vice President, Jan 2, 1996, p. SCGA 00286 (Ex. 155) (identifying VPOTUS events in April listed as intended to raise ''$ AMOUNT[[s]'' of 200 K'' in Los Angeles and another ''200K'' in San Jose). This document is stamped ''THE PRESIDENT HAS SEEN,'' with a handwritten notation appearing next to this reading ''1/8/96.''
This initial DNC proposal for Vice President Gore's only April 1996 event in Los Angeles became increasingly specific over time in additional Ickes memoranda forwarding fundraising targets to the Vice President. On February 9, for example, another Ickes memorandum raised the anticipated fundraising goal from Gore's planned April trip to Los Angeles to $250,000, and projected its likely expense as $25,000. (note - 244) At least by early March 1996, it appears, John Huang--now the DNC's top fundraiser among Asian-Americans--had been given responsibility for some of the upcoming events in California. (note - 245) By March 12, Vice President Gore's scheduling staff had begun specifically to discuss possible dates for the event, referring in internal memoranda to upcoming ''DNC fundraisers in San Jose & LA'' on ''April 27 29.'' (note - 246)
244Harold Ickes, memorandum to the President and Vice President, Feb. 9, 1996, at EOP 041361 (Ex. 156). This document is marked to indicate that the President read it on February 22.
245On March 7, for example, the Vice President's deputy chief of staff, David Strauss, had a telephone conversation with Huang about ''events in Cal[ifornia].'' David Strauss, telephone memorandum, March 7, 1996 (Ex. 157).
246Lisa A. Berg, e-mail to Kimberly H. Tilley, March 12, 1996 (Ex. 158) (discussing ''Up-coming travel of the Vice President'').
No specific location was set or even discussed for the Vice President's April fundraiser in Los Angeles, however, for some time after the initial Ickes memorandum in January that outlined the need for such an event. The first connection of a specific location to the Los Angeles fundraising trip, as we have seen, apparently came from the Vice President himself when he met at the White House with Venerable Master Hsing Yun on March 15. Vice President Gore's reference during this meeting to an upcoming trip to Los Angeles, apparently in April, could only have been to the $250,000 fundraising trip of which Ickes had advised the Vice President in his January and February memoranda: he had no other trips to Los Angeles planned between March 15 and April 29. This meeting was therefore the first time anyone at the White House had discussed a specific location in connection with Vice President Gore's April visit to Los Angeles.
Indeed, Huang and Hsia, at least, may even have intended the March 15 meeting with Hsing Yun to lay the groundwork for a Vice Presidential fundraiser at the Hsi Lai Temple. There is little other way, in fact, to explain the involvement of both Huang and Hsia in this meeting: Huang's job was to raise money for the DNC among Asian-Americans, and he and Hsia had been raising money together for Al Gore since 1989. Huang both requested and organized the Vice President's March 15 visit with Hsing Yun, and it was he who wrote the Vice President's briefing notes for the meeting. Furthermore, on March 13, two days before the White House meeting, the Vice President's deputy chief of staff, David Strauss, had a telephone conversation with Huang. Strauss claimed not to remember any specifics of this conversation, but he testified that it was related to the upcoming Hsing Yun visit at the White House. (note - 247) Significantly, his notes of this conversation include the notation ''John Huang . . . lead to a lot of $.'' (note - 248)
247Strauss deposition, June 30, 1997, pp. 56 & 59 (identifying telephone memorandum and adding that ''in my head . . . I have this linked with the Vice President's meeting with the Venerable Master.''); id ., p. 68 (''[T]his is connected to the meeting with the Vice President. That's the linkage.''); see generally id. , pp. 56 68.
248David Strauss, telephone memorandum, March 13, 1996 (Ex. 159).
Vice President Gore also clearly knew on March 15, 1996 that the DNC hoped to have him attend a fundraiser in Los Angeles at the end of April. Just after his meeting with Hsing Yun, his scheduler Kim Tilley asked the Vice President in an e-mail message about whether he would be interested in adding another stop on his April 29 itinerary on top of ''the two fundraiser[s] in San Joe [sic] and LA.'' In this same message, she informed the Vice President that ''[w]e've confirmed the fundraisers for Monday, April 29th.'' (note - 249) The Vice President responded--also that afternoon, by this point still only some four hours after having discussed his upcoming trip to Los Angeles with Hsing Yun in accepting the Temple's invitation to visit--that ''if we have already booked the fundraisers, then we have to decline'' invitations to add additional stops on the trip. (note - 250)
249Kimberly H. Tilley, e-mail message to Albert Gore, March 15, 1996 (Ex. 160).
250Albert Gore, e-mail message to Kimberly Tilley, March 15, 1996 (Ex. 160). Both Tilley and David Strauss have said that when the Vice President sent this e-mail, he understood the April 29 event to be a fundraiser. Strauss deposition, June 30, 1997, p. 83; Tilley deposition, pp. 147 48.
The March 15 meeting at the White House thus set in motion the process of picking the Hsi Lai Temple as the location for Vice President Gore's April 29 fundraiser in Los Angeles. Within two weeks, the DNC had confirmed the Temple as the location and notified the Office of the Vice President of this fact: by April 3, Maura McManimon had already sent a memorandum to the White House that described the location of this event as ''Hsi Lai Temple (Buddhist Temple presided over by Hsing Yun, whom the Vice President has met).'' (note - 251)
251Maura McManimon, memorandum to Jackie Dycke, April 3, 1996 (Ex. 161) (outlining for White House luncheon in Los Angeles). The very next day, as we have seen, Hsia asked Gorman to open a file entitled ''Vice President Gore Hsi Lai event April 29, 1996--DNC Fundraiser.'' See supra note 160.
Although Vice President Gore had been sufficiently concerned about possible foreign policy embarrassments to call Hsia for reassurances before meeting Hsing Yun at the White House in March 1996, the Vice President appears to have pressed ahead with the April 29 Temple event despite the misgivings of the NSC and his own national security advisors. As the fundraiser approached, the NSC again urged ''great, great caution.'' (note - 252) Because of these concerns, the Department of State was consulted; it suggested certain criteria to govern the event in the interest of preventing ''political exploitation by people from Taiwan.'' According to these rules, the Temple event was not to be billed as a ''Taiwan'' event but rather one ''for the Chinese community of Southern California.'' No ''Taiwan flags or KMT symbols or other signs that would be embarrassing for the VP'' could be displayed at the Hsi Lai Temple, and ''no Taiwan politician should be allowed to exploit the event.'' (note - 253Despite the imposition of these criteria, however, the Vice President's own national security staff suspected that the event's DNC organizers would be unable to meet them. As one aide put it, ''I think it may be difficult for the sponsors to meet the three criteria suggested by State.'' (note - 254) As one of Vice President Gore's national security aides, Bill Wise, warned in mid-April, ''I tend to seek the safer course in these situations, but I suspect the VP might opt to go ahead'' anyway. (note - 255)
252Robert Suettinger, e-mail message to John Norris, April 19, 1996 (Ex. 162) (''This is terra incognita to me. Certainly from the perspective of Taiwan/China balancing, this would be clearly a Taiwan event, and would be seen as such. I guess my reaction would be one of great, great, caution. They may have a hidden agenda.''). Gore's schedulers had consulted with the Vice President's national security staff in order ''to find out if there are any problems/ramifications with the use of the Hsi Lai Temple [sic] for the VP's DNC Lunch while in LA.'' Jackie Dycke, e-mail message to Tyler S. Beardsley, April 15, 1996 (Ex. 163); see also Jackie Dycke, e-mail message to Kimberly Tilley, April 16, 1996 (Ex. 164) (''Did you ever hear back from Bill [Wise] on Hsi Lai Temple?'').
253John Norris, memorandum to Bill [Wise], April 16, 1996 (Ex. 165).
254Bill Wise, handwritten addendum to John Norris memorandum of April 16, 1996 (Ex. 165).
255 Id .
It has been suggested--in accounts attributing this information to Hsia after stories about the Temple scandal began to appear in the press--that Huang had planned to hold his April 29 Vice Presidential fundraiser at the Harbor Village Restaurant in Monterey Park, California, but that this fundraiser was relocated to the Temple ''several days before Gore's trip.'' (note - 256) Such claims of a ''last-minute'' switch in location are false. As the restaurant's management declared in a sworn statement given to the Committee, no one ever contacted the Harbor Village about holding an event there on April 29, 1996. (note - 257) Even had the event initially been planned for another site, in fact, no specific location for the April 29 fundraiser other than the Hsi Lai Temple was ever discussed by or with anyone at the White House. (note - 258)
256 See Rich Connell and Alan C. Miller, ''Principals Say Temple Event was Explicit Fund-raiser,'' Los Angeles Times, Nov. 3, 1996, p. A21 (recounting claims by ''Hsia and others'' that Harbor Village Restaurant fundraiser was changed to Temple ''several days before Gore's trip'').
257Diana So, letter to Special Agent Gayle Jacobs, May 20, 1997 (Ex. 166) (''Per your request, we have looked into our reservation book back to the period between February 1996 and May 1996, [and] our record shows that there was not any party organized by John Huang, Maria Hsia or Matthew Gorman in our restaurant.''). A review conducted at the request of the Committee by the Vice Presidential Protective Division (VPPD) of the U.S. Secret Service also showed no ''records that would relate to a planned or actual visit by the Vice President to the Harbor Village Restaurant located in Monterey Park, California. No VPPD record reflects a planned or actual visit to that site.'' Ex. 122, p. 2.
258Hsia at one point apparently possessed a draft invitation on what appeared to be DNC letterhead for a DNC event on April 29 at the Harbor Village. Invitation to DNC APALC Event (Ex. 167). This document, however, was produced to the Committee only by Hsia & Associates, and apparently exists nowhere in the files of either the DNC or the White House (suggesting that no one beside Hsia ever saw it). Moreover, Gorman could not recall when he first saw this document. Indeed, Gorman admitted that he may only have seen it after the Gore fundraiser, and may indeed only have learned anything about the purported Harbor Village plan from Hsia herself--or from newspaper accounts quoting her that appeared after the Temple scandal had begun to break in the press. See Gorman deposition, pp. 187 90. No other document or testimony suggests any other specific location for the April 29 fundraiser apart from the Hsi Lai Temple itself, and there is no evidence that any such information was ever transmitted to the White House.
It is clear, therefore, that the Hsi Lai Temple was the only specific location ever discussed with White House officials. Documentary evidence also makes clear that after DNC event coordinator Maura McManimon sent her April 3 memorandum to the White House specifically identifying the Temple as the location for the DNC luncheon, the White House knew that the purpose of the April 29 stop in Los Angeles was to raise money. On April 10, for example, Harold Ickes sent the Vice President another memorandum, advising him that the April 29 event would raise $250,000 and would be organized by John Huang. (note - 259) Ickes specified further that for this event, as well as for the event in San Jose that same day, ''all proceeds [would go] to [the] DNC.'' (note -
259Harold Ickes, memorandum to the President and the Vice President, April 10, 1996 (Ex. 168), p. EOP 040782 (identifying VPOTUS event in Los Angeles on ''29 Apr'' having ''Projected Revenue'' of $250,000 and ''Huang'' as the staff contact). Later, this same memorandum again listed events for April as including a $250,000 fundraiser on April 29. Id. , p. EOP 040791.
260 Id. , p. EOP 040808.
Ickes sent the Vice President another memorandum on April 25, 1996, once again describing the DNC as planning a fundraising event in Los Angeles on April 29--again listing John Huang as the organizer, but now describing it in more detail as a luncheon and raising its ''projected revenue'' to $325,000. (note - 261) Within 24 hours of receiving this memorandum, Vice President Gore was given briefing materials from the DNC informing him that the DNC luncheon he would attend on April 29 was at the Hsi Lai Temple. (note - 262) The conclusion could scarcely have been more obvious. (note - 263) From these memoranda alone, it is clear that Vice President Gore understood the Temple event to be a DNC fundraiser.
261Harold Ickes, memorandum to the President and the Vice President, April 25, 1996 (Ex. 169), p. SCGA 01213 & 01223 (listing fundraiser in sections describing projected April events).
262DNC Finance, memorandum to Office of the Vice President, April 26, 1996 (Ex. 170) (briefing notes prepared by Richard Sullivan, John Huang, and Maura McManimon), pp. D 0000027 28 (last set of notes phrased in second person [ i.e. ''you''] for Vice President Gore discussing DNC luncheon at Hsi Lai Temple).
163Nor is there any question that the Vice President received this and other memoranda from Ickes. As Gore's executive assistant Heather Marabetti testified, while the Vice President's staff generally culled his ''inbox'' in order to remove documents that were not of the utmost importance, Ickes' memoranda always ''stayed in the inbox'' so as to receive personal Vice Presidential attention. Deposition of Heather Marabeti, Sept. 3, 1997, pp. 66 67.
The Vice President's staff also clearly understood that the April 29 event at the Temple was a fundraiser, as attested by the numerous internal messages and memoranda discussing the upcoming April 29 ''fundraiser'' in Los Angeles. On April 11, in fact, his staff held a meeting in Kimberly Tilley's office to discuss the upcoming ''fundraising events on April 29.'' (note - 264) Despite later White House claims that the Temple fundraiser was ''not a ticketed event,'' (note - 265) at this April 11 meeting, Vice Presidential scheduler Jackie Dycke handed out copies of a document she had prepared showing that the upcoming April 29 luncheon at the Temple in Hacienda Heights had a ''ticket price'' of $1,000 to $5,000 a head. (note - 266) This document was prepared on the basis of information given her by the DNC. Throughout the rest of April, internal White House e-mail traffic continued to refer to the upcoming Los Angeles ''fundraiser,'' (note - 267) the last of such references being on April 24, less than a week before the event was to occur. (note - 268)
264 See, e.g., Jackie A. Dycke, e-mail to R. Martinex et al., April 10, 1996 (Ex. 171) (''As you know, the VP is going to San Jose and LA for DNC fundraising events on April 29. . . . We are going to have a meeting at 2:15 p.m. TOMORROW (Thursday) in Kim Tilley's office (Room 285) to discuss everything that is out there for this California trip.''). This e-mail was sent to no fewer than 11 people on Vice President Gore's staff: R. Martinez, John Emerson, Kim Tilley, Julie Payne, Karen Skelton, Ellen Ochs, Wendy Hartman, Caren Solomon, Dennis Alpert, David Thomas, and Kim Hopkins.
265 See supra text accompanying note 238.
266Current Schedule for April 29, April 11, 1996 (Ex. 172), p. EOP 056497 (describing ''DNC Luncheon in LA/Hacienda Heights: 1000 5000 head/150 200 people'' and ''Reception in San Jose 150 200 guests/ticket price working out''); Deposition of Jacqueline Dycke, Aug. 8, 1997, p. 66.
267 See, e.g., Ex. 162 (John Norris, e-mail message to Robert Suettinger, April 15, 1996) (''Hsing Yun has invited the VP to visit the Hsi Lai Temple in LA. Hsing Yun would host a fundraising lunch for about 150 people in the VP's honor.'').
268John B. Emerson, e-mail to Bill [Wise], April 24, 1996 (Ex. 173) (listing Vice Presidential travel ''LA-- . . . DNC funder for lunch; then to San Jose for TV workshop event and funder'').
Everyone on the Vice President's staff involved with the Temple event thus knew exactly what was to occur. Despite the Vice President's claim that the staffers who accompanied him did not know that the event was a fundraiser, 269 Gore staffer Caren Solomon, who accompanied him on this trip, 270 had been sent an e-mail by scheduler Jackie Dycke discussing the upcoming ''fundraiser'' and inviting her to the meeting at which Dycke's ''ticket price'' memo had been distributed. (note - 271)
269Albert Gore interview supra note 233 (''I did not know that at the time. The people with me did not.'').
270Schedule for the Vice President, April 29, 1996 (Ex. 174), at EOP 007195 96 (showing Solomon on manifest for Marine II, Air Force II, and Los Angeles motorcade).
271Ex. 171 (reference to ''LA . . . DNC fundraising event on April 29'' and invitation to meeting to discuss trip, sent to Solomon). The Minority has tried to argue that a line-by-line analysis of the briefing notes and the daily schedule given to the Vice President for the Temple event--and a comparison between these documents and those that accompanied certain other DNC events--would have suggested to him that it was not, in fact, a fundraiser. This reasoning is entirely spurious. As Deputy Chief of Staff David Strauss testified, the Vice President's briefing materials for fundraisers did not always include information indicating that they were fundraisers and did not always indicate the amount to be raised. See Deposition of David Strauss deposition, Aug. 14, 1997, p. 240. Gore scheduler Ladan Manteghi testified similarly, conceding that not all fundraisers were described as such on the Vice President's schedule and that this schedule would usually not include indication of monetary amounts to be collected at fundraising events. Deposition of Laden Manteghi, Aug. 26, 1997, p. 33.
Moreover, Vice President Gore was apparently reminded that the April 29 luncheon was a fundraiser at the Temple itself. At least two of the guests who ate lunch with the Vice President in the Temple's dining hall on April 29 recall specifically that DNC fundraising was actually discussed from the podium after lunch. Daniel Hesse, for example--one of the two INS officials invited by Matthew Gorman as a non-paying ''VIP guest'' of Hsia--told the Committee that at some point during the Vice President's introductions by Don Fowler and Bob Matsui, ''one speaker commented that 'they had raised X amount of dollars.''' (note - 272) More explicitly, Sherry Shaw, who sat at Table 8, 273 recalls that one of the luncheon speakers took the podium and reassured the assembled guests that ''they'' had ''double-checked,'' and that it was ''O.K. to give contributions at the Hsi Lai Temple.'' (note - 274) She said that the man who made this comment ''had a Japanese last name.'' (note - 275) Vice President Gore was thus reminded of the event's fundraising purpose at the event itself, by the very DNC official who introduced him. (note - 276)
272Memorandum of Interview of Daniel Hesse, Aug. 5, 1997, p. 2.
273Ex. 132, p. 3. According to this list, Sherry Shaw's husband Gary sat at the head table with Vice President Gore. (Shaw is a naturalized U.S. citizen from the People's Republic of China, and gave $5,000 to the DNC at this Temple event.)
274Sherry Shaw, sworn statement submitted to the Governmental Affairs Committee, Aug. 21, 1997 (Ex. 175). This story of ''double-checking is generally corroborated by several other sources, among them Man Ho, Yi Chu, and Man Ya Shih--who have stated that the Temple had been advised prior to the event that the DNC had indicated that the Temple could host the luncheon even and that the holding of the event would not jeopardize the Temple's tax-exempt status because it was not unprecedented to hold such activities at a religious venue.
275Ex. 175 (Noting that man who made comments had ''a Japanese name''). This presumably identifies the speaker as DNC Treasurer Robert Matsui, the only Japanese-American to address the assembled guests and the official who introduced Vice President Gore. Representative Matsui, however, citing ''constitutional'' considerations, has refused to discuss with the Committee any comments he may have made at any point. See Stanley Brand, letter to Paul Robinson, June 9, 1997 (Ex. 179).
276 See April 29 Lunch: Event Procedures, undated (''Bob Matsui will introduce Vice President after Don Fowler's speach [sic].'') (Ex. 180); Handwritten note from Hsia & Associates files, undated (Ex. 181) (''Order of speeches: (1) M Hsing Yun (2) Don Fallow [sic] (Chairman) (3) Bob Mats. (4) VP Gore''). These remarks at the Vice President's luncheon may help explain the mysterious disappearance of the videotape taken by King & I Productions of the of the April 29 event at the Hsi Lai Temple. As Man Ho explained in her testimony before the Governmental Affairs Committee, the videographers were told not to videotape the speeches after lunch but apparently exceeded their instructions. See Man Ho testimony, pp. 176 77. After the company did record the speeches however--apparently including the abovementioned discussions of DNC fundraising that clearly show the Vice President to have known the nature of the Temple event--the Temple may have found it necessary to conceal the tape. * * * * * * *
In sum, it was or should have been obvious to everyone involved, including the Vice President, that the Hsi Lai Temple luncheon on April 29, 1996 was a DNC fundraiser. It is also now clear that most of the fundraising that occurred in connection with the Temple event was illegal--and that the donation-laundering orchestrated by Maria Hsia and carried out by Temple officials in connection with the Vice President's visit was not an aberration. Rather, it was part of a longstanding pattern of illegality undertaken in support of Democratic candidates in national elections that was established at least as early as September 1993 with the laundering of donations to the DNC in connection with another Vice Presidential event organized by Hsia and John Huang. More broadly, the Temple donation-laundering in 1996 was the culmination of a longstanding relationship of mutual assistance between Maria Hsia, John Huang, and the Vice President having its origins in the trip to Taiwan organized in late 1988 as part of James Riady's agenda for the Pacific Leadership Council. (note - 277)
277This close relationship between Hsia and covered persons under the Independent Counsel Act creates a ''political conflict of interest'' for the Attorney General that warrants the seeking of the appointment of an independent counsel under 28 U.S.C. 591(c)(1). See the section of the report on Charlie Trie and Ng Lap Seng's illegal fundraising. INSERT OFFSET FOLS. 116 253(1/2(, 254 612(1/2(, 613 TO 815 HERE INSERT OFFSET FOLS. 816 HERE
THE CHINA CONNECTION: SUMMARY OF THE COMMITTEE'S FINDINGS RELATING TO EFFORTS OF THE PEOPLE'S REPUBLIC OF CHINA TO INFLUENCE U.S. POLICIES AND ELECTIOIntroduction
From its earliest stages, the Committee's investigation uncovered instances of political contributions made with foreign money. Either contributing or soliciting this money have been individuals with business or political ties to the PRC, who have escorted PRC officials and businessmen to meetings with President Clinton and Vice President Gore, and who have otherwise facilitated efforts to shape United States policy towards China. The intelligence portion of the Committee's investigation sought to determine whether the foreign contributions and the PRC ties were mere coincidence, or if the PRC was in some way behind any foreign political contributions.
What the Committee learned was derived not from cooperative witnesses or the PRC, but from gathering information from our law enforcement and intelligence agencies and open sources, and piecing it together. Although the Committee received and reviewed a vast amount of information, there are nevertheless gaps in what the Committee has gathered. And describing these gaps might lead to the inadvertent disclosure of certain sources and methods used to obtain information about Chinese efforts. Mindful of these gaps, the Committee has endeavored to report what it has learned faithfully and accurately.
The Committee's investigation in this area of necessity proceeded behind closed doors. Virtually all of the information gathered by the Committee was classified, much of it at top secret and compartmented levels. The Committee took extraordinary steps to protect the information from disclosure, including limiting access to the information to Members and a very small number of appropriately cleared staff, using secured facilities to maintain materials and to hold briefings, meetings, and hearings, and acceding to numerous special restrictions placed by the intelligence agencies regarding the handling of the information. The Committee was also restricted as to what could be presented in public hearings because of the classified status of much of the relevant information. The same restrictions constrain what can be shared in this report.
Although hampered by time constraints and spotty cooperation from some federal agencies, the Committee has gathered significant information. The Committee determined from U.S. law enforcement and intelligence agencies and open sources that the PRC government fashioned a plan before the 1996 elections and that its goal was to influence our political process, ostensibly through stepped-up lobbying efforts and also funding from Beijing. Over time, the plan evolved and the PRC engaged in much more than simply ''lobbying.'' Indeed, discussions took place and actions were taken that suggest more than the original plan was being executed, and that a variety of PRC entities were acting to influence U.S. elections.
What follows is a discussion of the Majority staff's work and the Committee's findings in this area. The discussion first provides context for why the Committee pursued this subject, by describing early media accounts of alleged foreign activities and briefings provided in 1996 by the FBI to Members of Congress and the White House. Next, it addresses in abbreviated form some of the significant connections between the campaign finance investigation and the Greater China area(1( , including the ties specific figures have to the PRC government. It then lays out what the Committee learned about the existence of a ''China plan,'' and about other, possibly-related activities undertaken by the PRC government, as well as information regarding the implementation of the plan. Throughout the discussion, the Committee describes the significance it sees in all of this.
1For the purposes of this report, the term ''Greater China'' encompasses territories claimed or recently acquired by the PRC, including Hong Kong, Macao, and the Republic of China on Taiwan.
Owing to the sensitivity of the subject, the Committee has been unable to share with the American people most of the documentary or testimonial evidence that supports the following discussion, nor can it do so now. Moreover, the Committee will be unable to address the subject matter publicly much beyond the precise wording of the discussion that follows. However, a longer, more detailed, and classified account of the Committee's findings has been prepared and will be maintained in secure environs. Initial Indications of Chinese Efforts to Influence the 1996 Campaigns
During the investigation's earliest stages, several seemingly well-sourced press reports described the fund-raising efforts of overseas Chinese in this country and speculated on their possible relationships to the PRC. On February 13, 1997, the Washington Post first reported a link between foreign campaign money and the PRC government. (note - 2) Citing ''officials familiar with the inquiry,'' the article alleged, ''A Justice Department investigation into improper political fund-raising activities has uncovered evidence that representatives of the People's Republic of China sought to direct contributions from foreign sources to the Democratic National Committee before the 1996 presidential campaign.'' The Post observed that criminal investigators ''suspected a Chinese connection to the current fund-raising scandal because several DNC contributors and major fund- raisers had ties to Beijing,'' and identified, in particular, Yah Lin ''Charlie'' Trie and John Huang.
2Bob Woodward and Brian Duffy, ''Chinese Embassy Role in Contributions Probed,'' Washington Post, February 13, 1997, p. A1.
Other media stories preceding the start of the Committee's public hearings in July reported additional details on covert Chinese plans to fund political contributions in this country. The New York Times on March 13, 1997 wrote that ''surreptitiously monitored'' conversations between Chinese officials here and in Beijing ''suggested that Beijing was prepared to take a drastic step: illegally funneling money to American politicians.'' (note - 3) Time reported in March that ''provocative'' communications among Chinese officials picked up by American intelligence ''indicated that front companies for the Chinese government might try to funnel cash.'' (note - 4) Who might have directed this? According to the Washington Post , ''top'' Chinese officials approved plans ''to attempt to buy influence with American politicians,'' and the plans continued through 1996 and to the present. (note - 5)
3David Johnston, ''U.S. Agency Secretly Monitored Chinese in '96 on Political Gifts,'' New York Times, March 13, 1997, p. A1.
4Richard Lacayo, ''What Did China Want?'', Time, March 24, 1997, p. 48.
5Bob Woodward, ''Top Chinese Linked to Plan to Buy Favor,'' Washington Post, April 25, 1997, p. A1.
Additional stories indicated the FBI had commenced a foreign counterintelligence probe of the matter in 1996, briefing six Members of Congress regarding the Bureau's belief ''that the government of China may try to make contributions to Members of Congress through Asian donors.'' (note - 6) The Bureau later briefed a seventh Member in October 1996. The FBI also told the White House about the Chinese plan in June 1996, when FBI agents briefed two representatives of the National Security Council. The FBI briefings described illegal plans for the clandestine funding of American political campaigns.
6Brian Duffy and Bob Woodward, ''FBI Warned Six on Hill About China Money,'' Washington Post, March 9, 1997, p. A1. See also Lacayo, supra , p. 49. Initial Indications were Consistent with What the Committee was Discovering About Foreign Money Being Funneled into the 1996 Elections
Early in the investigation, Committee staff discovered a number of money trails that led from the DNC and other Democratic causes back overseas, and, particularly, to Greater China. The trails wend their way from foreign countries through one bank account after another, ending up mainly in DNC coffers. Committee staff traced some of these trails backwards as far as the transaction--generally a wire transfer--that brought into the United States funds eventually used to make political contributions. (note - 7)
7Although in several cases Committee staff members identified a foreign account that served as the source of a contribution to the DNC, they could not continue back to the actual trailhead when it was located overseas since the Committee held no authority to compel production of foreign bank records. Hence, whether a contribution that entered the U.S. from an account in China, Hong Kong, Taiwan, Macao, Indonesia, or some other country was connected in some way to the PRC government could not be determined from an examination of the records.
Committee staff identified several instances of foreign money donations connected to six individuals with ties to the PRC. As noted below, John Huang, Maria Hsia, Ted Sioeng, and James and Mochtar Riady each have been associated in some way with the Government of China. The sixth, Yah Lin ''Charlie'' Trie, is a business partner of Ng Lap Seng, a Macao businessman with alleged ties to the PRC. Trie, who recently was indicted and arrested, escorted Wang Jun, head of China's principal arms trading company, Polytechnologies, to a February 6, 1996 coffee with President Clinton and a meeting the same day with Commerce Secretary Ron Brown.
In 1996, John Huang solicited some $3.4 million in contributions to the DNC. Nearly half this amount has been returned as the contributions were determined by the DNC to have been made with actual or suspected foreign funds. In September 1993, Huang wrote three checks to the DNC, each in the amount of $15,000, each paid with foreign money. The checks were drawn on the accounts of three Lippo Group subsidiaries--Hip Hing Holdings, San Jose Holdings, and Toy Center Holdings. At the time the checks were written, all of the companies were losing money and operating in the red. Hearing testimony from a Huang coworker indicates the money for the three contribution checks came from Lippo accounts in Jakarta. (note - 8) In short, the 1993 checks Huang signed were paid with foreign money.
8Testimony of Juliana Utomo, July 15, 1997.
Huang's $45,000 in DNC contributions was made in close proximity to occasions when Huang may have arranged for Vice President Gore to meet Shen Jueren, the head of a commercial enterprise wholly owned and operated by the PRC's Ministry of Foreign Trade and Economic Cooperation. Called China Resources Holdings, Shen's company has been identified as a PRC intelligence-gathering operation; one with reported ties to the People's Liberation Army. (note - 9) On Friday, September 24, 1993--the day after Huang wrote the first two $15,000 checks to the DNC--Huang escorted Shen Jueren to the White House, where Shen met with Gore's chief of staff, Jack Quinn, and may have met with Gore as well. The following Monday, September 27, 1993, Huang wrote another $15,000 check to the DNC. On the same day, at a Santa Monica event organized by Huang and Maria Hsia, Shen Jueren may have met again with Vice President Gore.
9Nicholas Eftimiades, Chinese Intelligence Operations, p. 80 (1994). Eftimiades writes that China Resources traditionally has a PRC military officer installed as a vice president. It should be noted that, in 1993, China Resources purchased a 50% share of the Hong Kong Chinese Bank from the Lippo Group.
The Riadys were Huang's patrons and supporters throughout his careers at Lippo and later the Department of Commerce and the DNC. In fact, James Riady attended a small meeting in the Oval Office on September 13, 1995, at which President Clinton was asked if he would help Huang move from Commerce to the DNC. President Clinton acceded to the request, and by the end of the year, Huang became the DNC's vice-chairman of finance, a position created especially for him. The Riadys were also for many years generous supporters of President Clinton and the DNC.
Maria Hsia was involved in soliciting contributions to the DNC that were laundered through several Buddhist monks and may have derived from foreign sources. Once the figures had been tallied for the April 29, 1996 Hsi Lai Temple fund-raiser attended by Vice President Gore, it became apparent that the event had not generated the level of contributions expected by the DNC. As a result, DNC Finance Director Richard Sullivan asked Huang to ''get some California money in.'' (note - 10) Huang turned to Maria Hsia, who engineered a scheme whereby some $55,000 was contributed to the DNC by temple monastics who, in turn, were reimbursed out of the Temple's general expense account. The source of the Temple's money is believed to be Buddhist devotees and may derive from overseas.
10Deposition of Richard Sullivan, June 25, 1997, pp. 45 46.
Ted Sioeng was one of the DNC's largest contributors during the 1996 federal election cycle. He is also distinguished as the DNC donor whose contributions are linked perhaps the most clearly to foreign sources. Sioeng, his family, and his business enterprises contributed $400,000 to the DNC in 1995 and 1996. Through a review of bank records, the Committee has determined that at least half, or $200,000, of the DNC contributions was funded by transfers from overseas accounts. In each case, money was wired into a Sioeng family account in the U.S. from the account of a Hong Kong company. Although the Committee knows little about the foreign companies that funded Sioeng's operations in this country, one of the businesses, Mansion House Securities, is believed to be owned in part by the Chinese government.
Yah Lin ''Charlie'' Trie also solicited large amounts of foreign money. In Trie's case, the cause was the Presidential Legal Expense Trust, set up to help satisfy the legal bills incurred by President and Mrs. Clinton. In March 1994, Trie brought nearly half a million dollars in small-denomination checks and money orders to the law office administering the Trust. The checks and money orders, it turned out, were written by followers of a Buddhist Sect called Suma Ching Hai. Many of the followers were reimbursed in the amount of their contributions. Ultimately, the reimbursement money came from accounts in Taiwan and Cambodia.
None of the aforementioned individuals would speak to the Committee about their fund-raising activities. Sioeng left the country soon after the campaign finance scandal broke. The Riadys likewise have stayed out of the United States, and declined to meet with Committee staff working in Indonesia. Huang and Hsia have remained in this country but have both asserted their Fifth Amendment privilege against self-incrimination. Trie initially left the country but recently returned and was arrested. He was indicted on January 28, 1998 and charged on 15 counts, including conspiracy to defraud the DNC and the United States. The indictment charges Trie with participating in the conspiracy by, among other things, purchasing access to high level government officials through contributions made to the DNC. Campaign Contributors' PRC Connections
Information obtained by the Committee reveals close ties between the PRC and many of the individuals who produced or facilitated foreign campaign contributions. And these individuals--Ted Sioeng, Maria Hsia, John Huang, and James and Mochtar Riady--interacted with one-another with some frequency. Their paths appear to have crossed most often when they were engaged in fund- raising or contributing money to the Democratic National Committee. Ted Sioeng . (note - 11) The Committee has learned that Sioeng worked, and perhaps still works, on behalf of the Chinese government. Sioeng regularly communicated with PRC embassy and consular officials at various locations in the United States, and, before the campaign finance scandal broke, he traveled to Beijing frequently where he reported to and was briefed by Chinese communist party officials.
11 See also chapter of report on Ted Sioeng.
The Committee is aware of a handful of activities Sioeng undertook at the request of or with support from the PRC government. Perhaps the most significant of these activities was Sioeng's purchase in late 1995 of The International Daily News , a Chinese-language newspaper based in Los Angeles. Prior to Sioeng's purchase of a controlling interest in the paper, The International Daily News had a pro-Taiwan slant. Sioeng changed that by bringing in new people and altering the paper's ideology to conform with the views of the PRC government. After purchasing the paper, Sioeng subsidized it heavily, which was necessary due to its operating losses. Sioeng financed the purchase and subsidization of the paper through transfers of funds from Hong Kong accounts.
Sioeng and his family and business interests played a large role in the 1996 elections. They spent over $550,000 on political campaigns and organizations in 1995 and 1996, including $400,000 on the Democratic National Committee and $50,000 on the National Policy Forum. As discussed in greater detail elsewhere,(12( the Committee has subpoenaed and reviewed voluminous bank and business records relating to Sioeng, his family, and their businesses. The Committee has traced much of the money for these contributions to bank accounts in Hong Kong but no further. Hence, the Committee does not know whether these contributions derived from or were directed by the PRC government. Records reveal that the PRC consulate in Los Angeles paid Sioeng's Hollywood Metropolitan Hotel $3,000 by a check dated March 22, 1996. (note - 13) The Committee has concluded that the PRC consulate provided Sioeng the money for the purpose of making or reimbursing a political contribution to Dr. Daniel Wong, a Republican who ran for the California State Assembly. It appears that the PRC money was in fact used to make or reimburse a contribution to Wong in the amount of $5,000. (note - 14) Committee staff have no means to determine what other funds might have been provided to Sioeng by the PRC government through transfers among foreign accounts.
12 Id .
13$3,000 Bank of China check from the Consulate General of the People's Republic of China to the Hollywood Metropolitan Hotel, March 22, 1996. (Ex. 1).
14$5,000 Grand National Bank check from Sundari, Sandra, and Laureen Elnitiarta to Dr. Daniel Wong, February 15, 1996. (Ex. 2).
Ted Sioeng controls a business empire estimated to be worth approximately $500 million. The Committee has learned that Sioeng considered spending a portion of his considerable wealth to support lobbying efforts approved by PRC officials. Maria Hsia . (note - 15) The Committee has learned that Hsia has been an agent of the Chinese government, that she has acted knowingly in support of it, and that she has attempted to conceal her relationship with the Chinese government. The Committee has also learned that Hsia has worked in direct support of a PRC diplomatic post in the U.S.
15 See also chapter of report on Maria Hsia and the Hsi Lai Temple.
As described elsewhere in the report, Hsia has been a significant figure in the Committee's investigation, and the Committee has conducted numerous interviews and depositions and examined voluminous records relating to her. Hsia first met Vice President Gore in the late 1980s, and organized a trip he attended to Taiwan in 1989. She has raised money for the Democratic Senatorial Congressional Committee (''DSCC''), and lobbied to have DSCC contributions earmarked for then-Senators Gore and Simon. On September 27 1993, she attended the Santa Monica, California event with John Huang where Shen Jueren may have met Vice President Gore. In connection with that meeting, Hsia contributed $5,000 in money illegally laundered through the Hsi Lai Temple.
Hsia has a long standing relationship with the Hsi Lai temple. She, with Huang, organized the April 1996 fund-raiser held there and attended by Vice President Gore, and laundered thousands of dollars illegally through temple clerics in connection with the event. The Committee has identified over $130,000 in political contributions illegally laundered through temple monastics at Hsia's direction.
The Committee has received information that Hsia worked with Ted Sioeng and John Huang to solicit contributions from Chinese nationals in the United States and abroad for Democratic causes. Hsia and Huang, in particular, worked together to identify non-U.S. citizens overseas who might contribute money to Democratic causes. John Huang . (note - 16) Since well before its hearings began, the Committee focused on John Huang. The goal was to understand why an executive at a small California bank (owned by a large Indonesian conglomerate), who raised money prolifically for the Democratic party and was rewarded with a political appointment at the Department of Commerce, was so often and well received by President Clinton and his staff. The Committee's interest was further piqued by the fact that to date, the DNC has returned half of the money Huang raised in 1996. The DNC has been unable to verify that these funds derived from a legal, domestic source.
16 See also chapters of report on the Lippo Group, John Huang at the Department of Commerce, and Huang's hiring by the DNC.
The Committee has examined in detail Huang's activities at Lippo, Commerce, and the DNC. A single piece of unverified information shared with the Committee indicates that Huang himself may possibly have had a direct financial relationship with the PRC government. The Committee's information is not corroborated, but nevertheless it adds to concerns regarding Huang's activities at Commerce, which were a focus of Committee hearings in July 1997 and are discussed elsewhere in this report. (note - 17)
17 See chapter of report on John Huang at the Department of Commerce. James and Mochtar Riady . (note - 18) The Committee has learned from recently-acquired information that James and Mochtar Riady have had a long-term relationship with a Chinese intelligence agency. The relationship is based on mutual benefit, with the Riadys receiving assistance in finding business opportunities in exchange for large sums of money and other help. Although the relationship appears based on business interests, the Committee understands that the Chinese intelligence agency seeks to locate and develop relationships with information collectors, particularly persons with close connections to the U.S. government.
18 See also chapters of report on the Lippo Group, John Huang at the Department of Commerce, and Huang's hiring by the DNC.
The Riadys are central figures in the campaign finance scandal for several reasons. First, they have close ties with President Clinton. James and Mochtar Riady have known President Clinton since the mid-1980s when they held a controlling interest in the Worthen Bank. The Riadys have visited Clinton in the White House on several occasions. Second, the Riadys were heavy contributors to the DNC and other Democratic causes. They made and solicited significant contributions directly in connection with the 1992 elections; subsequently, various Riady businesses, associates, and employees did likewise. Third, they were the employers of John Huang, whom they helped place at the Department of Commerce, then the DNC. The Committee Learns of a ''China Plan'' and Other, Possibly Related Efforts
The foregoing indicates that large amounts of money were funneled from accounts in Greater China into the DNC by individuals who had close ties to the PRC. This activity takes on greater import when viewed in light of the fact that the PRC government had developed and implemented plans to influence the U.S. political process before most of the aforementioned contributions were made. The Committee first learned of these efforts early in the investigation. (note - 19)
19Senator Thompson made a public statement on July 8, 1997, disclosing the existence of a China plan and related activities. The CIA and FBI edited the statement and authorized its public disclosure.
To understand the plan one needs to appreciate the context from which it emerged. The plan is intertwined with the state of America's relationship in recent years with the PRC and the Republic of China on Taiwan. Although the United States maintains no official ties with the government on Taiwan, Taipei's views have long influenced U.S. diplomatic relations with the PRC. This is largely because Beijing considers Taiwan a rogue province and suspects it of seeking independence from the mainland.
In May 1995, Lee Teng-hui, President of the Republic of China on Taiwan, was granted a visa to visit the United States. Caught off-guard, Beijing was quick to voice its outrage and to engage in a series of overt retaliatory measures. China suspended arms control talks with Washington, postponed cross-Strait talks with Taiwan, canceled official visits to and from the United States, amassed troops along the coast facing Taiwan, and recalled its ambassador to the United States.
But not all of China's reactions were overt. Secretly, Beijing worked to prevent similar diplomatic surprises from occurring in the future. After President Lee's visit, high-level PRC government officials devised plans to increase China's influence over the U.S. political process and to be implemented by PRC diplomatic posts in the U.S.
Some of Beijing's efforts appear relatively innocuous, involving learning more about Members of Congress, redoubling PRC lobbying efforts in the U.S., establishing closer contacts with the U.S. Congress, and funding from Beijing. But the Committee has learned that Beijing expected more than simply increased lobbying from its diplomatic posts in the U.S. Indeed, as the Committee examined the issue in greater detail, it found a broad array of Chinese efforts designed to influence U.S. policies and elections through, among other means, financing election campaigns.
The Committee's understanding of the plan derives from U.S. law enforcement and intelligence agencies, open sources, and the Committee's own investigative efforts. It is important to understand that there is no consensus among the agencies concerning where the plan ends and other PRC activities in this country begin. The Committee has learned in sobering detail of a wide range of covert PRC efforts in the U.S. and overseas designed to influence elections in this country. Many of these activities may or may not have been part of a single, coordinated effort. Regardless, a coordinated approach may have evolved over time. Other efforts, though undertaken by PRC government entities, have been characterized as rogue activities. Such fine distinctions fall beyond the scope of this report. Evidence Emerges that the Plan Was Implemented and Other Efforts Were Undertaken by the PRC
The Committee has identified specific steps taken in furtherance of the plan. Implementation of the plan has been handled by PRC government officials and individuals enlisted to assist in the effort. Activities in furtherance of the plan have occurred both inside and outside the United States.
Through the plan and related efforts, the PRC government aimed to increase China's influence in the United States. Some of the efforts were typical, appropriate steps foreign governments take to communicate their views on United States policy. They included retaining lobbying firms, inviting more Congresspersons to visit China, and attempting to communicate Beijing's views through media channels in the United States. However, other efforts appear illegal under U.S. law. Although most discussion of PRC activities focused on Congress, the Committee's investigation suggests that China's efforts involved the 1996 Presidential race and state elections as well. The Committee has received information that the government of China may have allocated millions of dollars in 1996 alone to achieve its objectives.
The Committee has learned of several activities China undertook to influence our political processes during the 1996 election cycle. Some of these include: A PRC government official devised a seeding strategy, under which PRC officials would organize Chinese communities in the U.S. to encourage them to promote persons from their communities to run in certain state and local elections. The intent behind the seeding program was to develop viable candidates sympathetic to the PRC for future federal elections; The Government of China established the ''Central Leading Group for U.S. Congressional Affairs'' to coordinate China's lobbying efforts in this country. President Jiang Zemin approved the Group's creation; A U.S. agency received fragmentary reporting relating to China's efforts to influence the U.S. Presidential election. The information is considered part of a criminal investigation and cannot be discussed with the Committee further; PRC intelligence officials discussed increasing China's lobbying efforts in the United States and planned to raise millions of dollars to support those efforts. PRC officials met with one or more Chinese businessmen residing outside of mainland China to discuss raising the money and how it would be spent; PRC officials discussed financing American elections through covert means; A politically-sensitive transfer of funds may have occurred to a PRC-controlled account in the U.S.; A PRC official involved in a discussion concerning Chinese lobbying efforts indicated an awareness that money placed in U.S. banks can be traced by U.S. law enforcement officials; A PRC official encouraged Chinese-Americans to make political contributions and contact their Congressmen; and Beijing was angered that its diplomatic officials in the U.S. failed to forewarn the Mainland about the burgeoning campaign finance scandal and that those officials were not aware of Chinese who went to Washington, D.C. for the purpose of lobbying or making political contributions.
These activities show that several different PRC government entities joined the effort to involve themselves in U.S. elections and that the PRC went well beyond lobbying to achieve its goals. Whether or not all of this was contemplated at the outset by high-ranking Chinese officials or simply evolved over time, it nevertheless happened, and in a clandestine manner. Summary
It is clear that illegal foreign contributions were made to the DNC and that these contributions were facilitated by individuals with extensive ties to the PRC. The original sources of many of these contributions were bank accounts in the Greater China area.
It is also clear that well before the 1996 elections, officials at the highest levels of the Chinese government approved of efforts to increase the PRC's involvement in the U.S. political process. There are indications that the plan or parts of the plan and possibly-related PRC activities were implemented covertly in this country. The individuals who facilitated the contributions have either elected to take the Fifth Amendment or flee the country. Beijing has denied the Committee's request for assistance. Moreover, after its hearings concluded, the Committee learned that the Chinese leadership was pleased no PRC agencies have yet been implicated in the campaign finance scandal.
While the Committee still cannot determine conclusively whether the PRC funded, directed, or encouraged the illegal contributions in question, all of the information related herein, taken together, constitutes strong circumstantial evidence that the PRC government was involved. In addition, there are indications that Chinese efforts in connection with the 1996 elections were undertaken or orchestrated, at least in part, by PRC intelligence agencies. It is likely that the PRC used intermediaries, particularly with regard to political contributions. This is so because only U.S. citizens or legal permanent residents can contribute lawfully to political parties and campaigns. Moreover, the use of businesses and individuals as intermediaries is increasingly common among Chinese intelligence and military organizations. (note - 20) Given the way the PRC exercises control over certain businesses and individuals, it hardly would be surprising to learn that the PRC directed overseas Chinese to contribute to particular parties or candidates. In addition to furthering the goals of the PRC plan, such actions would seem within the capabilities of a government able to implement private espionage and intelligence-gathering activities.
20Eftimiades, supra, pp. 27-43. It is also well-established that the PRC wields influence over a wide range of entities and individuals, many of whom conduct business directly with the PRC. One area in which the PRC employs businesses is economic espionage. State-owned or controlled companies--particularly those controlled by the People's Liberation Army--are used increasingly as part of a Chinese network to acquire Western technology in the United States and other countries. Jane's Defense Weekly, December 17, 1997, p. 1. Another area is intelligence-gathering, where the PRC government has attempted to cultivate members of the overseas Chinese community as information sources.
Throughout its investigation, the Committee has firmly believed it is important for the American people to be made aware of as much of the information set forth in this section of the report as possible. Yet, getting to the bottom of such matters and also sharing the Committee's findings has been an extremely difficult process. The first difficulty derives from the nature of the information itself. Some of the information provided to the Committee requires the protection of sources and methods used to gather it, which has placed significant limits on the Committee's ability to discuss these matters publicly. That protection is a legitimate concern, but it has come at the cost of curtailing public knowledge and debate. The Justice Department for the most part would not reveal matters that were the subject of its ongoing criminal investigation. While Justice's concern is understandable, it limits Congressional oversight and makes it even more important that prosecutorial decisions be handled in a way that ensures public confidence.
The second difficulty is more complex and, ultimately, more troublesome. The Committee dealt at length with various law enforcement and intelligence agencies in developing portions of the information set forth above and observed a recurring problem: the failure to share relevant, classified information. The failure meant that no one agency had a complete picture of all the relevant information in a particular area and, indeed, a given agency might be unaware of all the relevant information it held within its various sections or departments. The clearest example of this involved the FBI and the Justice Department. In two major instances FBI headquarters and Justice were unaware of crucial information located in FBI field office files, information months and sometimes years old. The information came to light only as a result of persistent Committee probing. These lapses are currently the subject of a Department of Justice Office of Inspector General (OIG) investigation. The Committee has cooperated with OIG investigators and will continue to monitor their progress. The inability of the Bureau to locate certain intelligence information denied the campaign finance criminal task force timely access to important classified materials. By the time the information was surfaced and passed along, some or all of it might have grown stale.
It is the Committee's hope that, for the sake of future criminal investigations, steps are taken by intelligence and law enforcement agencies to ensure that such lapses do not reoccur. In that regard, the Committee intends to review any recommendations made by the OIG on improving how such information is shared.
CHARLIE TRIE'S AND NG LAP SENG'S LAUNDERED CONTRIBUTIONS TO THE DNC Introduction
Former Little Rock, Arkansas, restaurateur Yah Lin ''Charlie'' Trie and Macau-based businessman Ng Lap Seng collaborated in a scheme to contribute hundreds of thousands of dollars in foreign funds to the DNC. Ng wired over one million dollars from accounts he maintains in Macau and Hong Kong to accounts maintained by or accessible to Trie in Little Rock and Washington, D.C. Although Trie held himself out as an international trader (and, in fact, actively sought to develop an international trading business he called Daihatsu International Trading Corporation), he was never successful. Trie's bank records and tax returns reveal that he received little or no income from sources other than Ng Lap Seng.
Although he failed to establish a successful, income-generating international trading business, Trie, his wife and his businesses managed to contribute a total of $220,000 to the DNC between 1994 and 1996. Trie and Ng also reimbursed the contributions made by a number of other DNC contributors who were recruited by Trie in order to further disguise the ultimate source of the contributions. As Trie earned little money through his own business activities, the Committee concludes that Trie used the foreign-source funds wired from Ng to make his (and his wife's and businesses') DNC contributions and to reimburse the conduit contributors. The Justice Department indicted Trie for these illegal activities on January 28, 1998. (note - 1)
1Indictment, United States v. Yah Lin ''Charlie'' Trie & Yuan Pei ''Antonio'' Pan, Criminal No. 98-0029 (D.D.C.), Jan. 28, 1998; see also Roberto Suro & Toni Locy, ''Indictment Returned in Fund Probe; 'Charlie' Trie Charged With Funneling Foreign Money to Democrats,'' Washington Post, Jan. 29, 1998, p. A1.
Trie's contributions purchased access for himself and Ng to the highest levels of our government. Documents produced by the White House and DNC reveal that both Trie and Ng attended DNC-sponsored events with President Clinton and made a number of visits to the White House. The Committee also concludes that Trie's contributions and fundraising purchased his otherwise unwarranted appointment in 1996 to the Commission on U.S.-Pacific Trade and Investment Policy.
While a review of subpoenaed records of Trie's businesses and bank accounts, interviews with individuals familiar with Trie and his businesses, and testimony of two conduit contributors have revealed much about the activities of Trie and Ng, but since the Committee's subpoena power ''stops at the Pacific Ocean line,'' it is possible that this information merely scratches the surface and further details remain undiscovered. (note - 2)
2Testimony of Jerry Campane, July 29, 1997, p. 28.
Moreover, virtually all key witnesses have been unavailable to Committee investigators. Trie himself fled the country and, in an interview with NBC News in June 1997, boasted that Congressional investigators would ''never find me.'' (note - 3) Committee investigators traveling in Asia successfully reached Ng through a surprise call to his cellular phone, but Ng refused to meet with or answer the investigators' questions, and instead simply referred them to his attorney. A number of individuals with knowledge of Trie and Ng's activities have also asserted their Fifth Amendment right not to testify without immunity. For instance, Trie's Arkansas-based secretary/bookkeeper, Maria Mapili, who made handwritten explanatory notes on the statements of a bank account maintained by Trie's company, Daihatsu International Trading Corporation, 4 asserted the Fifth Amendment and refused to decipher her notes for the Committee. On July 23, 1997, the Committee voted to immunize Keshi Zhan, Ng's Washington-based bookkeeper, and soon thereafter called her for deposition. However, because Zhan demonstrated an unwillingness to testify with any reasonable degree of candor (even with respect to the relatively noncontroversial issues on which she was questioned), the Committee elected to terminate her deposition and allow the Department of Justice to proceed with its investigation and possible criminal prosecution of Zhan. (note - 5)
3 See Leslie Wayne, ''State Department Asks China to Help Find Former Fund-Raiser,'' New York Times, July 24, 1997, p. A21. The government of the People's Republic of China also prohibited Committee investigators traveling in Asia from entering the country to find Trie.
4 See Maria Mapili's explanatory notes on Daihatsu International Trading Corporation's First Commercial Bank statements (Ex. 1); see also Memorandum of Interview of Charlotte Duncan, July 9, 1997, p. (note - 1) (''Mapili would write where each deposit came from and what each payment was for.'').
5In order to avoid any conceivable ''taint'' on a future prosecution of Zhan, the Committee (1) terminated Zhan's deposition before questioning her about those subjects that would most likely be the subject of any possible future Department of Justice prosecution and (2) directed the court reporter not to even transcribe her testimony.
Finally, among the fifteen counts in the Justice Department's January 28, 1998 indictment of Trie was a count alleging that Trie obstructed the Committee's investigation by instructing unnamed individuals to ''alter, destroy, mutilate, conceal and otherwise fail to produce documents responsive to a subpoena issued by the United States Senate Committee on Governmental Affairs.'' (note - 6) These allegations suggest that Trie's employees withheld documents responsive to the Committee's February 13, 1997 subpoena to Daihatsu International Trading Corporation that could have furthered the Committee's investigation of Trie and Ng's activities. (note - 7)
6Indictment, United States v. Yah Lin ''Charlie'' Trie & Yuan Pei ''Antonio'' Pan, Criminal No. 98-0029 (D.D.C.), Jan. 28, 1998, p. 36.
7FBI agents acting at the direction of federal prosecutors investigating Trie's activities executed search warrants at Trie's Watergate office and Trie's home and office in Little Rock and discovered documents that had not previously been produced to the Committee. Background on Yah Lin ''Charlie'' Trie Yah Lin ''Charlie'' Trie was born August 15, 1949, in Taiwan. (note - 8) Trie is a United States citizen. (note - 9) He is married to Wang Mei Trie and has one daughter. (note - 10)
8 See ''Biographic Information'' form submitted by Trie to the Immigration and Naturalization Service (Ex. 2).
9 See Trie's United States Passport (Ex. 3).
10 See ''Bio-Data of Yah Lin Trie'' (Ex. 4); Ex. 2.
Trie immigrated to the United States, and in the late 1970's settled in Little Rock, Arkansas, where his older sister, Dailin Outlaw, ran a number of Chinese restaurants. (note - 11) Trie worked with his sister until 1984, when she left Little Rock and turned over to Trie control of a restaurant she called (and Trie subsequently continued to call) Fu Lin. (note - 12)
11 See Kevin Sack, ''From Restaurateur to Intimate at the White House,'' New York Times, Jan. 27, 1997, p. A8.
12 See Memorandum of Interview of Dewey Glasscock, July 1, 1997, p. 2.
Fu Lin flourished during the latter half of the 1980's, when it became a popular gathering place for local political officials. (note - 13) Local patrons described Trie as a gracious host who befriended many important customers and assisted favored political candidates by hosting fundraisers at his restaurant. (note - 14)
13 See Memorandum of Interview of James Dailey, June 10, 1997, p. 1.
14 See Memorandum of Interview of Julia Hughes Jones, June 19, 1997, p. 2; Memorandum of Interview of Martha Shaffner, June 10, 1997, p. 1; Dailey interview, p. 4; Kevin Sack, ''From Restaurateur to Intimate at the White House,'' New York Times, Jan. 27, 1997, p. A8.
Among the politicians who frequented Fu Lin and became friends with Trie was then-governor Bill Clinton. Trie was a strong and vocal Clinton political supporter throughout the President's years as governor, 15 and Trie was extremely proud when his friend Bill Clinton became President of the United States. (note - 16)
15 See Trie's contributions to Clinton's 1982 Arkansas Governor's race and related correspondence (Ex. 5); Shaffner interview, p. 3; Dailey interview, p. 4.
16 See Shaffner interview, p. 3.
By the early 1990's, Trie began to tire of the restaurant business and considered exploring international trading opportunities with China. 17 Trie mentioned his ideas to Governor Clinton who told Trie that he thought that Trie's idea was a good one because China was evolving politically and would soon be expanding its markets. (note - 18) Clinton encouraged Trie to get in on the ground floor and develop a Chinese-American trading business. (note - 19) Trie then sold Fu Lin and focused exclusively on cultivating various trading opportunities. (note - 20)
17 See Memorandum of Interview of Julia Hughes Jones, June 19, 1997, pp. 2 3 ; Memorandum of Interview of Jody Webb, June 20, 1997, p. 2.
18 See Webb interview, p. 2.
19 See id.
20 See id.
Trie formalized his new Asian trading efforts by incorporating a company he called Daihatsu International Trading Corporation. (note - 21) In early November 1992, Trie received from newly elected President Bill Clinton a letter of congratulations and encouragement for Trie's new company. (note - 22) Daihatsu, however, never developed into a successful international trading operation. In one of Daihatsu's earliest business ventures, Trie sought to coordinate the Chinese manufacture of a unique wrench and the subsequent sale of that wrench to American chain stores such as Wal-Mart. (note - 23) This venture ultimately proved unsuccessful, and Trie lost his investment--the better part of the profits from the sale of Fu Lin. (note - 24) Trie later pursued trading opportunities involving products as varied as safe deposit boxes and chickens, but few, if any, of these ventures ever developed into successful business deals. (note - 25) Trie's most profitable export venture (selling cotton to a manufacturing plant in China) brought Trie a broker's commission of only $30,000. (note - 26)
21 See Daihatsu information summary (Ex. 6).
22Letter from Bill Clinton to Yah Lin ''Charlie'' Trie, November 10, 1992 (Ex. 7).
23 See Memorandum of Interview of Lorin Fleming, May 30, 1997, p. 1.
24 See id ., pp. 1 3; Glasscock interview, p. 3.
25 See id .
26 See Webb interview, p. 2.
Trie also incurred ''extraordinary'' expenses promoting these ultimately unsuccessful international trading efforts. (note - 27) For instance, on a number of occasions, Trie escorted delegations of Little Rock businesses and governmental officials to various cities in China in an effort to establish business ties that would benefit Daihatsu. (note - 28) Those traveling with Trie on these trips explained to the Committee that Trie, who insisted on staying in expensive hotels and eating at the best restaurants, paid for all expenses associated with the trips except air fare. (note - 29) Trie's expenses are reflected in his monthly credit card payments of often close to $20,000. (note - 30) Trie also routinely withdrew thousands of dollars--in cash--from his personal and business bank accounts. (note - 31)
27Testimony of Jerry Campane, July 29, 1997, p. 33.
28 See, e.g. , Letter from Julia Hughes Jones to Charlie Trie, October 12, 1992, thanking Trie for including her in the ''Arkansas delegation'' on a recent China trip (Ex. 8).
29 See Jones interview, p. 2; Fleming interview, p. 1.
30 See Memorandum of Interview of Charlotte Duncan, July 9, 1997, p. 2; see also, e.g. , Daihatsu expense reports indicating substantial payments to a number of credit cards (Ex. 9).
31Testimony of Jerry Campane, July 29, 1997, p. 34.
The combination of Trie's significant expenses and his inability to complete successful international trading deals meant that ''Daihatsu made little or no money at any time.'' (note - 32) Daihatsu's corporate tax returns for 1992 through 1995 indicate that its gross income was never more than $250,000, its net income was negligible, and Trie's income as president of the company was approximately $30,000 per year. (note - 33) The Committee also determined that ''Trie and his wife had very little income from other sources.'' (note - 34)
32 Id ., p. 12.
33 See Daihatsu's tax returns, 1992 95 (Ex. 10); Duncan interview, p. 2.
34Testimony of Jerry Campane, July 29, 1997, p. 12.
In early 1994, Trie submitted an ultimately unsuccessful bid on behalf of himself and two partners to buy and refurbish the dilapidated Camelot Hotel in downtown Little Rock. (note - 35) Trie's partners were Mana Han Xiao, owner of the Haili Restaurant in the Capitol Hotel in Beijing (and, one witness believed, a relative of Trie 36 ), and Ng Lap Seng. (note - 37) None of the Little Rock residents interviewed by the Committee who were involved in the preparation of Trie's bid knew specifically how or why Ng became involved in the Camelot project. (note - 38) The Committee has also been unable to uncover any evidence of prior business dealings between Trie and Ng or of when and how Trie and Ng first met.
35 See Cover to ''Rebirth of the Camelot--A Proposed Four Star Hotel'' submitted in the name of Daihatsu International by Trie and his partners (Ex. 11).
36 See Webb interview, p. 3.
37 See Ex. 11.
38 See Webb interview, p. 3.
In September 1994, Trie opened a branch office of Daihatsu in Washington, D.C., in a leased residential cooperative apartment at the Watergate. (note - 39) Although Trie was advised that the Watergate rent was more than his business could afford, appearance was important to Trie and he believed a Watergate address gave him a certain stature as a businessman. (note - 40) He used his Watergate venue to host delegations of visiting Chinese businessmen who gathered for receptions and parties with Trie's local friends and political contacts. (note - 41) Ng Lap Seng, Ng's bookkeeper Keshi Zhan, and former Lippo Group executive and Trie business associate Antonio Pan 42 also used the Watergate Office while in Washington. (note - 43)
39 See Shaffner interview, p. 2; Lease Agreement for Watergate South apartment, August 15, 1994 (Ex. 12).
40 See Shaffner interview, p. 2.
41 See Lena H. Sun, ''Pacific Trade Commission Appointee Was Considered a White House 'Must'; Trie, a Longtime Democratic Fund-Raiser, Says He Didn't Seek Post,'' Washington Post , Dec. 18, 1996, p. A20; Memorandum of Interview of Charles Chiang, July 21, 1997, p. 2.
42 See Business Card identifying Antonio Pan as Senior Vice President of Tati Group--China division of the Lippo Group (Ex. 13); Business Card identifying Antonio Pan as Chief Executive Officer of Daihatsu International Trading, Inc. (Ex. 14); Business Card identifying Antonio Pan as Executive Director of America-Asia Trade Center Inc. (Ex. 15); Deposition of David Mercer, May 14, 1997, pp. 20 21.
43 See Memorandum of Interview of Sam Chang, July 11, 1997, pp. 2 3.
In addition to Daihatsu International Trading Corp., Trie was also responsible for the incorporation of additional businesses in Little Rock and Washington. In October 1994, Trie incorporated a company in Little Rock for Ng Lap Seng called San Kin Yip International Trading Corp. (note - 44) Trie explained to the Washington Post that San Kin Yip International Trading Corp., which possessed the same mailing address as Daihatsu, was related to Ng's Macau-based real estate development and investment companies called the San Kin Yip Group. (note - 45) The Washington Post also reported that San Kin Yip International Trading Corp. was created to ''import textiles and other goods and export chemicals, machinery and advanced technology.'' (note - 46) Subpoenaed San Kin Yip International Trading Corp.'s bank records, however, revealed ''neither earnings nor any genuine business activity.'' (note - 47)
44 See Letter from Daihatsu employee ''Jennifer'' to Ng employee ''Miss Chen,'' Oct. 11, 1994 (Ex. 16).
45Lena H. Sun, ''DNC Donor Admits 'Mistake'; Fund-Raiser's Own Company Contributed Foreign Generated Money,'' Washington Post , Dec. 7, 1996, p. A11.
46Lena H. Sun & Dan Morgan, ''Asian Firm's First U.S. Ties Included DNC; Contribution Followed 10 Days in Arkansas,'' Washington Post , Dec. 1, 1996, p. A1.
47Testimony of Jerry Campane, July 29, 1997, pp. 11 12.
After relocating to Washington, D.C., Trie incorporated a second San Kin Yip entity called San Kin Yip (U.S.A.) Inc. (note - 48) After reviewing San Kin Yip (U.S.A.) Inc.'s bank records, however, the Committee concluded that (like San Kin Yip's Little Rock branch) San Kin Yip (U.S.A.) Inc. neither made money nor engaged in any actual business activity. (note - 49)
48 See Chang interview, p. 1.
49Testimony of Jerry Campane, July 29, 1997, pp. 11 12.
Finally, Trie incorporated American Asia Trade Center in Washington in 1996, intending to purchase a building a few blocks from the White House that would house a Chinese restaurant on the first floor and offices of companies engaging in Asian trade on the remaining floors. (note - 50Trie, however, never actually bought the property and never opened the restaurant. (note - 51) Thus, American Asia Trade Center, like the two San Kin Yip entities incorporated by Trie, also never made money. (note - 52)
50 See Chang interview, p. 2.
51 See id .
52Testimony of Jerry Campane, July 29, 1997, pp. 11 12. Background on Ng Lap Seng
In 1979, Ng Lap Seng (who is often referred to by the name ''Mr. Wu,'' the Mandarin pronunciation of his name) bribed a police officer on the Chinese border with the Portuguese enclave of Macau in 1979, and entered Macau with virtually no money to his name. (note - 53) Today, Ng, who travels under a Portuguese passport, 54 is chairman of the Macau-based San Kin Yip Group, a commercial and residential development conglomerate. (note - 55) Ng reported in the bid submission for the Camelot Hotel renovation project that his conglomerate's annual gross sales are $250 million. (note - 56)
53 See Lena H. Sun & John Pomfret, ''The Curious Cast of Asian Donors; Some Sought Access to Clinton, Others' Motives' Remain Murky,'' Washington Post, Jan. 27, 1997, p. A1.
54 See Ng Lap Seng's Portuguese Passport (Ex. 17).
55 See Lena H. Sun & Dan Morgan, ''Asian Firm's First U.S. Ties Included DNC; Contribution Followed 10 Days in Arkansas,'' Washington Post, Dec. 1, 1996, p. A1; see also Ng's business card (Ex. 18).
56 See Summary of Ng's business activities included in Camelot Hotel submission (Ex. 19).
Press reports have tied Ng to both the government of the People's Republic of China and to criminal activity in Macau. According to the Washington Post, a directory of Chinese government officials and press reports identifies Ng as a member of the Chinese People's Political Consultative Conference, an advisory board for the Chinese government and ruling Communist Party. (note - 57) Newsweek also reported that Ng was convicted in Macau in 1991 for relabeling Chinese-made clothing in order to circumvent U.S. import quotas on Chinese products. (note - 58)
57Lena H. Sun & John Pomfret, ''China Adviser's Gift to DNC Under Review; After Audit, Party Will Return More Donations,'' Washington Post, Feb. 25, 1997 p. A1.
58C.K. Binswanger, ''Tracking 'Mr. Wu's' Fortune,'' Newsweek, Aug. 11, 1997 p. 6. Trie's Political Contributions
In spite of Trie's lack of success as an international trader (and the significant expenses associated with his unsuccessful ventures), Trie, his family, and businesses still managed to contribute a total of $220,000 to the DNC between 1994 and 1996. The contributions are specifically identified in the following chart: Date 5/14/94
59$20,000 check to ''D.N.C.'' drawn on First Commercial Bank account maintai 5/14/94
60$60,000 check to ''D.N.C.'' drawn on First Commercial Bank account maint 5/25/94
61$20,000 check to ''D.N.C. (Non Federal)'' drawn on First Commercial Bank 6/21/94
62$7,500 check to ''D.N.C.'' drawn on First Commercial Bank account mainta 8/1/94
63$20,000 check to ''D.N.C.'' drawn on First Commercial Bank account maint10/20/94
64$15,000 check to ''D.N.C.'' drawn on First Commercial Bank account maint 6/21/95
65$50,000 check to ''D.N.C.'' drawn on First Commercial Bank account maint 2/29/96
66$12,500 check to ''Democratic National Committee'' drawn on First Commer 5/12/96
67$10,000 check to ''D.N.C.'' drawn on First Commercial Bank account maint 7/31/96
68$3,000 check to ''D.N.C.'' drawn on Riggs National Bank account maintain 9/28/96 ------------------------------- --------------------
69$2,000 check to ''Victory '96'' drawn on Riggs National Bank account maiThe DNC allocated the first $20,000 in contributions made personally by both Trie and his wife in May 1994 to its ''federal'' or ''hard money'' account. 70 The DNC has since returned the entire $220,000. (note - 71)
70 See DNC Finance ''Executive Summary'' of Trie's 1994 contributions identifying that Trie's $20,000 contribution in May 1994 was allocated to the DNC's federal ( i.e. , ''hard money'') account, and that his $60,000 May 1994 contribution was allocated to the DNC's non-federal ( i.e. , ''soft money'') account (Ex. 31); DNC Finance ''Executive Summary'' of Wang Mei Trie's contribution identifying that her $20,000 contribution was also allocated to the DNC's federal account (Ex. 32). See also Deposition of Joseph E. Sandler, Aug. 22, 1997, p. 16 (''Q: . . . [W]hat does the code F01 refer to? A: Federal account.''). Although Wang Mei Trie's $20,000 check expressly states that it is a contribution to the DNC's ''Non-Federal'' account (Ex. 22), the DNC obtained her certification that she ''inadvertently designated'' her contribution and that it was her ''intention that [the] contribution of $20,000 was to be deposited into the DNC's federal account.'' See Letter from Neil Reiff to Wang Mei Trie, June 3, 1994 (Ex. 33).
71 See ''Contributions Refunded 6/27/97'' (Ex. 34).
THE SOURCE OF FUNDS USED BY TRIE FOR HIS CONTRIBUTIONS
Given the failure of Trie's businesses to make money in an amount that could have permitted Trie to contribute $220,000, the Committee concludes that Trie used ''foreign-source money that he obtained primarily from [Ng Lap Seng]'' to fund all of his DNC contributions. (note - 7
72Testimony of Jerry Campane, July 29, 1997, p. 36.
Between 1994 and 1996, Trie and his businesses received a total of approximately $1.5 million by wire transfer from foreign sources. (note - 73) Trie received over $1.1 million of this $1.5 million from Ng Lap Seng. 74 Ng wired this money from accounts he maintained at branches of the Bank of China in Hong Kong and Macau and an account with Hong Kong Shanghai Banking to three domestic accounts maintained by or accessible to Trie. 75 Trie then shuffled the money among a total of six domestic accounts, four of which ultimately served as the source of a contribution to the DNC. (note - 76)
73 See ''Foreign Source Wire Transfers to Trie and Trie-related Entities'' (Ex. 35).
74 Jerry Campane (a FBI supervisory special agent on detail to the Committee for this investigation) testified on July 29, 1997 that Trie received $905,000 in wire transfers from Ng. Testimony of Jerry Campane, July 29, 1997, pp. 12 13. Campane also noted, however, that ''our records show an August 7, 1996, transfer of $200,000 from the Bank of China, Macau from an account held in the name of a trading company with a name very similar to some of [Ng's] companies. However, because we were not able to definitively establish that this particular company was indeed controlled by [Ng], I have not included this transfer in the total . . . .'' Id. , p. 13. Since then the Committee has confirmed that this company, Cia de Investimento e Fomento Predial Goodwill Lda, is associated with Ng. See Facsimile from Liz Wheeless to Theodore Kavowras attaching corporate information on Compania de Investimento e Fomento Predial Goodwill, Limitada'' (Ex. 36). This confirmation increases the total wired from Ng to Trie to $1.105 million. See ''Ng Lap Seng's Wire Transfers to Charlie Trie (1994 1996)'' (Ex. 37).
75 See ''Flow of Funds from Ng Lap Seng Among Accounts Associated with Charlie Trie'' (Ex. 38). Although Trie does not maintain signature authority over San Kin Yip's First Commercial Bank account (an account identified in the center column of Ex. 38), Trie's secretary/bookkeeper, Maria Mapili, does possess such authority. See Testimony of Jerry Campane, July 29, 1997, pp. 30 31. It is also clear that Trie understood that he possessed authority over the funds in the account, regardless of his technical lack of authority to sign checks drawn on the account. When questions arose as to the source of San Kin Yip's $15,000 contribution to the DNC, Trie told the Washington Post that he was uncertain whether he, his wife or his secretary was responsible for signing San Kin Yip's check to the DNC. Lena H. Sun, ''DNC Donor Admits 'Mistake'; Fund-Raiser's Own Company Contributed Foreign-Generated Money,'' Washington Post, Dec. 7, 1996, p. A11.
76 See Ex. 38.
Because Trie appears to have earned little or no money from his international trading businesses, the Committee has concluded generally that all of Trie's contributions were made with foreign funds received by wire transfer from Ng Lap Seng and other foreign sources. The following specific contributions to the DNC (a total of $135,000), however, can be definitively traced to particular wire transfers of foreign funds. Yah Lin and Wang Mei Trie's May 1994 Contributions Totaling $100,000
On May 6, 1994, a Hong Kong-based company (in this case, apparently not affiliated with Ng Lap Seng) named Lucky Port Investments, Limited, wired $100,000 to an account maintained by Trie and his wife at First Commercial Bank in Little Rock. (note - 77) LippoBank Los Angeles served as an intermediary for the transaction. (note - 78)
77 See Confirmation of the wire transfer of $100,000 from Lucky Port Investments Ltd.'s account at the Hong Kong Chinese Bank Ltd. to Yah Lin Trie's account at First Commercial Bank in Little Rock, May 6, 1994 (Ex. 39).
78 See ''Advice of Transfer of Funds'' confirming transfer of $99,985 from Lippo Bank, Los Angeles to Yah Lin Trie's account at First Commercial Bank in Little Rock, May 6, 1994 (Ex. 40).
Prior to receipt of the $100,000 from Lucky Port, the balance in Trie's First Commercial account was only $3,759. (note - 79) In the weeks following receipt of the wire transfer from Lucky Port Investments, Trie and his wife contributed a total of $100,000 to the DNC. Trie wrote checks of $60,000 and $20,000 on May 14, 80 and his wife, Wang Mei Trie, wrote a $20,000 check on May 25. (note - 81)
79 See May 24, 1994 bank statement for account maintained by Yah Lin Trie or Wang Mei Trie indicating an account balance on May 4, 1996 (prior to the $100,000 wire transfer) of $3,759.64 (Ex. 41); see also June 23, 1994 bank statement for the same account (Ex. 42). While these bank statements reveal that approximately $8,500 was deposited into the account after the May 6, 1994 wire transfer from Lucky Port Investments, but before Trie's three contribution checks had cleared, this $8,500 was insufficient to cover any of the three contribution checks. Trie and his wife therefore could not have made their $100,000 in contributions without receipt of the wire transfer from Lucky Port Investments.
80 Ex's 20 & 21.
81 Ex. 22.
As Lucky Port is based in Hong Kong and not independently incorporated in the United States, 82 the Committee has discovered only that it maintains a telephone number in Hong Kong 83 and that former Lippo Group executive and Trie business associate Antonio Pan served as a director of the company at the time that the wire transfer was made. (note - 84)
82 See Testimony of Jerry Campane, July 29, 1997, p. 39.
83 See Facsimile from Phillip Layton to Liz Wheeless, July 28, 1997 (Ex. 43).
84 See ''Notice of change of directors . . .'' submitted to the Hong Kong Registrar of Companies, Oct. 4, 1993 (Ex. 44). Yah Lin Trie's August 1, 1994 Contribution of $20,000 On August 1, 1994, Trie wrote another $20,000 check to the DNC. (note - 85) The ultimate source of this contribution was a $100,000 wire transfer on July 26, 1994 from an account maintained at the Bank of China, Macau branch, by Ng Lap Seng to Daihatsu International Trading Corp.'s account at First Commercial Bank in Little Rock. (note - 86) The balance in Daihatsu's account at the time it received the wire transfer was only $472. (note - 87) One day after Ng wired the money to Daihatsu, Wang Mei Trie wrote a $25,500 check on Daihatsu's account to Yah Lin Trie. (note - 88) Before the deposit of the $25,500 check, the balance in Trie's account was only $414. (note - 89) Trie deposited the check into his First Commercial account and, four days later, on August 1, 1994, made his $20,000 contribution to the DNC.
85 Ex. 24.
86 See ''Advice of Transfer of Funds'' confirming a $99,985 wire transfer from Ng Lap Seng's account at the Bank of China, Macau branch, to Daihatsu's account at First Commercial Bank in Little Rock (Ex. 45).
87 See July 29, 1994 bank statement for account maintained by Daihatsu International Trading Corp. indicating a balance in the account on July 25, 1994 (prior to receipt of the $99,985 wire transfer) of $472.03 (Ex. 46).
88 See $25,500 check to ''Yah Lin Trie'' drawn on First Commercial Bank account maintained by Daihatsu International Trading Corp., July 27, 1994 (Ex. 47).
89 See Aug. 24, 1994 bank statement for account maintained by Yah Lin Trie indicating a ''beginning balance as of 7 26 94'' (prior to receipt of the $25,500 check from Daihatsu) of $414.64 (Ex. 48). San Kin Yip International Trading Corporation's October 21, 1994 Contribution of $15,000
On October 11, 1994, Trie had an account opened at First Commercial Bank in Little Rock in the name of San Kin Yip International Trading Corp. (note - 90) The account was opened with a $500 deposit. (note - 91) On October 20, 1994, Ng Lap Seng wired $100,000 from his Bank of China, Macau branch, account into the newly opened San Kin Yip account in Little Rock. (note - 92) One day later, on October 21, 1994, a $15,000 check with an unidentifiable signature was written from San Kin Yip to the DNC. (note - 93) Trie himself has admitted to the press that this contribution was made with Ng's funds wired from abroad. (note - 94)
90 Ex. 16.
91 See id. ; see also Oct. 31, 1994 bank statement for account maintained by San Kin Yip International Trading Co. indicating a ''beginning balance as of 10 10 94'' of ''.00'' and a $500 deposit on October 11, 1994 (Ex. 49).
92 See confirmation of $99,985 wire transfer from Ng Lap Seng's Bank of China, Macau Branch account to San Kin Yip International Trading Corp.'s First Commercial Bank account, Oct. 20, 1994 (Ex. 50).
93 Ex. 25.
94 See Lena H. Sun & John Pomfret, ''The Curious Cast of Asian Donors; Some Sought Access to Clinton, Others' Motives' Remain Murky,'' Washington Post, Jan. 27, 1997, p. A1. Trie's Fundraising
In addition to contributing personally (and through his family and businesses) to the DNC, Trie was also involved in raising funds for the party. (note - 95) In 1996 alone, Trie made a commitment to the DNC to raise $350,000. (note - 96)
95 Trie was also responsible for the solicitation of almost $700,000 in illegal contributions to the Presidential Legal Expense Trust (''PLET''). See the section of this report on Trie's fundraising for the PLET.
96 See Letter from Marvin Rosen to Charlie Trie, Feb. 21, 1996 (Ex. 51).
Trie's adoption of the role as fundraiser in addition to that of donor did not mean a significant change in tactics. Where Trie relied on Ng's wire transfers to make his own contributions, funds wired from Ng were used to reimburse third parties from whom contributions were solicited. These third parties simply served as alternate conduits for the flow of Ng's foreign-source funds to the DNC.
The Committee received the only first-hand account of these tactics from two women, Yue Chu and Xiping Wang, who testified that their political contributions were reimbursed by Ng's bookkeeper, Keshi Zhan. Further conduit contributors, including Zhan, have been identified only through a review of bank records.
Yue Chu and Xiping Wang each emigrated from China in the past ten years 97 and both are presently resident aliens ( i.e., green-card holders) in the United States. (note - 98) Yue Chu is married to Ming Chen, who manages a Beijing restaurant that is owned by Ng Lap Seng. (note - 99) Yue Chu is a close personal friend of Zhan. (note - 100) Xiping Wang is married to Zhengwei Cheng, a cousin of Ming Chen. (note - 101)
97 Testimony of Yue Chu, July 29, 1997, p. 126; Testimony of Xiping Wang, July 29, 1997, p. 140.
98 Yue Chu testimony, p. 150; Xiping Wang testimony, p. 150.
99 Yue Chu testimony, pp. 126 28.
100 Id., p. 128.
101 Xiping Wang testimony, pp. 140 41.
Yue Chu testified that on November 14, 1995, Zhan came to her home and asked Yue Chu for a $3,000 loan. (note - 102) Yue Chu agreed without either asking for or receiving any explanation for Zhan's request. (note - 103) Zhan then directed Yue Chu to make out a $2,000 check to the DSCC and a $1,000 check to Zhan. (note - 104) Yue Chu testified that she did not know what DSCC stood for. (note - 105)
102 Yue Chu testimony, p. 131.
103 Id., p. 132.
104 Id., pp. 131 32; see $2,000 check to ''DSCC'' drawn on Ming Chen and Yue F. Chu's Chevy Chase Bank account, Nov. 14, 1995 (Ex. 52); $1,000 check to Keshi Zhan drawn on Ming Chen and Yue F. Chu's Chevy Chase Bank account, Nov. 14, 1995 (Ex. 53).
105 Yue Chu testimony, p. 132.
Yue Chu further testified that Zhan immediately reimbursed her by providing her with a $3,000 check payable to her husband, Ming Chen, drawn on a Riggs National Bank account maintained jointly by Ng Lap Seng and Charlie Trie. (note - 106) Zhan possessed signature authority over the joint Ng/Trie account. (note - 107) The memo line on the check states ''consulting.'' Yue Chu testified that she does not speak or read English and therefore did not understand the notation. (note - 108)
106 Id., pp. 132 33; see $3,000 check to ''Ming Chen'' drawn on Ng Lap Seng and Charlie Trie's Riggs National Bank account, Nov. 14, 1995 (Ex. 54).
107 See ''Power of Attorney (Durable),'' Dec. 20, 1994 (Ex. 55).
108 Yue Chu testimony, p. 133.
Yue Chu further testified that in February 1996 her husband, Ming Chen, told her that his boss, Ng Lap Seng, requested a $25,000 loan so that he could buy a ticket and ''pass the gate'' to a political function. (note - 109) Yue Chu testified that she understood the ''gate'' to be the gate to the White House. (note - 110) Because Yue Chu and Ming Chen possessed only a combined total of $20,000 in their two bank accounts at that time, they decided to provide the $20,000 and to call on Ming Chen's cousin, Zhengwei Cheng, for the remaining $5,000. (note - 111)
109 Id., pp. 133 34.
110 Id., p. 134.
111 Id., p. 135; see $12,500 check to ''DNC'' from Yuefang Chu's Bank-Fund Staff Federal Credit Union account, Feb. 19, 1996 (Ex. 56); $7,500 check to ''DNC'' from Ming Chen & Yue F. Chu's Chevy Chase Bank account, Feb. 19, 1996 (Ex. 57).
On February 19, 1996, Zhan again came to Yue Chu to collect Yue Chu's portion of the funds requested by Ng. Zhan directed Yue Chu to sign a check from each of Yue Chu's two accounts, and Zhan then filled in the payee and the amounts ($12,500 and $7,500). (note - 112) Yue Chu testified that she did not pay any attention to the payee--the DNC--designated by Zhan. (note - 113) Zhan then provided Yue Chu with two checks written on the account maintained jointly by Ng and Trie. (note - 114) Yue Chu testified that the DNC reimbursed her for her $20,000 contribution. (note - 115) She has not, however, returned the $20,000 to Ng Lap Seng. (note - 116)
112 Yue Chu testimony, pp. 135 36.
113 Id., p. 137.
114 Id., pp. 138 40; see $12,500 and $7,500 checks to ''Ming Chen'' drawn on Ng Lap Seng and Charlie Trie's Riggs National Bank account, Feb. 19, 1996 (Ex. 58).
115 Yue Chu testimony, p. 140.
116 Id., p. 148.
Yue Chu's husband, Ming Chen, then went to his cousin's (Zhengwei Cheng's) house and asked for a $5,000 loan from Xiping Wang, his cousin's wife. (note - 117) Xiping Wang testified that Ming Chen explained that he needed the money in order to help his boss (Ng Lap Seng) ''pass a gate'' to the White House. (note - 118) Xiping Wang complied and wrote a $5,000 check to the DNC. (note - 119) At the time that she wrote the check, however, her account did not contain sufficient funds to cover the amount of the check. (note - 120) Her husband therefore called Ming Chen the next day, and asked Ming Chen for reimbursement. (note - 121) Xiping Wang testified that Ming Chen personally deposited a $5,000 check drawn on Trie and Ng's joint account (and signed by Zhan) into their bank account. (note - 122) Xiping Wang testified that she has not been reimbursed by the DNC for her contribution. (note - 123)
117 Xiping Wang testimony, pp. 140 41.
118 Id., p. 141.
119 Id.; see $5,000 check to ''DNC'' drawn on Zhengwei Cheng's and Xiping Wang's Bank-Fund Staff Federal Credit Union account, Feb. 19, 1996 (Ex. 59).
120 Xiping Wang testimony, p. 142.
122 Id.; see $5,000 check to ''Zhengwei Cheng'' drawn on Ng Lap Seng and Charlie Trie's Riggs National Bank account, Feb. 19, 1996 (Ex. 58).
123 Xiping Wang testimony, p. 148.
The bank records for Trie and Ng's joint Riggs account indicates that Zhan could not have reimbursed Yue Chu and Xiping Wang without funds provided by wire transfer from Ng. On February 14, 1996, five days before Yue Chu and Xiping Wang made their contributions to the DNC, Ng wired $150,000 from an account maintained in the name of San Kin Yip Holdings Co. Ltd. at the Bank of China, Hong Kong branch, to the Riggs National Bank account maintained jointly by Ng and Trie. (note - 124) The balance in that account prior to the wire transfer was $10,459.55, significantly less than the $25,000 in reimbursed contributions. (note - 125)
124 See confirmation of $149,985 wire transfer from San Kin Yip Holdings Co. Ltd.'s Bank of China, Hong Kong branch, account to Ng Lap Seng and Charlie Trie's Riggs National Bank account, Feb. 14, 1996 (Ex. 60).
125 See March 5, 1996 bank statement for account maintained by Ng Lap Seng and Charlie Trie indicating a balance on Feb. 13, 1996 (prior to receipt of the $149,985 wire transfer) of $10,459.55 (Ex. 61).
Yue Chu testified to the Committee that she had no knowledge of the overseas source of the funds used to reimburse her for her contributions. (note - 126) Xiping Wang testified that she knew ''even less.'' (note - 127)
126Yue Chu testimony, p. 145.
127Xiping Wang testimony, p. 145.
Yue Chu also testified to a third reimbursed contribution, this one for $1,000 to the ''Gephardt Congress Committee'' on June 15, 1996. (note - 128)She testified that on that day, Zhan came to her house and asked for a $1,000 loan. (note - 129) Again, Zhan did not tell Yue Chu the purpose of the loan. (note - 130) Yue Chu wrote the check as directed by Zhan and immediately received a $1,000 reimbursement, this time from Zhan's own account. (note - 131) Yue Chu testified that the Gephardt Congress Committee returned her contribution in March 1997, but that she had not yet repaid Zhan. (note - 132)
128 See $1,000 check to ''Gephardt Congress Committee'' drawn on Ming Chen and Yue F. Chu's Chevy Chase Bank account, June 15, 1996 (Ex. 62).
129Yue Chu testimony, pp. 148 49.
130 Id., p. 149.
131 Id.; see $1,000 check to ''Chen Ming'' drawn on Keshi Zhan's Bank-Fund Staff Federal Credit Union account, June 15, 1996 (Ex. 63).
132Yue Chu testimony, p. 150.
On July 23, 1997, the Committee voted to immunize Zhan, the bookkeeper for Ng Lap Seng who possessed signature authority over the account maintained jointly by Ng and Trie. (note - 133) As discussed above, Zhan used this authority to sign checks on Ng and Trie's account reimbursing Yue Chu and Xiping Wang for their contributions to the DNC and Representative Gephardt's campaign committee.
133Eric Schmitt, ''In a Rebuff to Justice Dept., Senate Inquiry Immunizes 5,'' New York Times, July 24, 1997, p. A1.
Pursuant to the use immunity provided by the Committee's July 23, 1997 vote and a July 30, 1997 order of Chief Judge Norma Holloway Johnson of the United States District Court for the District of Columbia,(134( Zhan appeared for deposition on August 14 and 15, 1997. However, in spite of her immunity (and contrary to the proffer on which the Committee's decision to immunize her was based), Zhan proved from the beginning of her deposition to be an entirely uncooperative witness. The Committee therefore decided to terminate her deposition before reaching several critical areas of inquiry. (note - 135) The Department of Justice was notified of the Committee's decision.
134Order of Chief United States District Judge Norma Holloway Johnson in case captioned Senate Committee on Governmental Affairs, Misc. No. (note - 97226 (D.D.C.), July 30, 1997 (Ex. 64).
135In order to avoid any possible taint on a possible future criminal prosecution of Zhan, the Committee also directed the court reporter not to prepare a transcript of her deposition.
The following information about Zhan's conduit contribution is derived entirely from bank records independently obtained by the Committee pursuant to subpoenas directed to the banks at which the relevant accounts are maintained.
On February 19, 1996, Zhan not only collected contribution checks from Yue Chu and Xiping Wang, she also wrote a $12,500 check on her own account,(136( and reimbursed herself with a check drawn on Ng and Trie's joint Riggs account. (note - 137) Zhan's bank statement for February 1996 indicates that she possessed sufficient personal funds to make the $12,500 contribution without reimbursement. (note - 138) However, in light of the identical Yue Chu and Xiping Wang transactions on the same day, the Committee concludes that this is another example of the laundering of Ng's foreign funds to make a contribution to the DNC. (note - 139)
136 See $12,500 check to ''DNC'' drawn on Zhan's Bank-Fund Staff Federal Credit Union account, Feb. 19, 1996 (Ex. 65).
137 See $12,500 check to ''Keshi Zhan'' drawn on Ng Lap Seng and Charlie Trie's Riggs National Bank account, Feb. 19, 1996 (Ex. 66).
138 See Feb. 29, 1996 bank statement for account maintained by Keshi Zhan indicating a balance on Feb. 16, 1996 (prior to receipt of the $12,500 check) of $15,229.82 (Ex. 67).
139Testimony of Jerry Campane, July 29, 1997, pp. 17 18; see also id., p. 72 (''Senator Smith: Does that sound like money laundering to you? Mr. Campane: That is what we call in the business a slam-dunk, Senator.'').
Manlin Foung, a sister of Trie, also made a DNC contribution after receiving funds originating from one of Ng's overseas bank accounts. On August 15, 1996, Foung received $10,000 by wire transfer from a Riggs National Bank account maintained by San Kin Yip International Trading Company. (note - 140) Prior to receipt of the wire transfer, Foungs account had a balance of almost $5,379. (note - 141) Foung used the check to make a $10,000 contribution to the DNC in the name of the ''Birthday Victory Fund.'' (note - 142)
140 See confirmation of $10,000 wire transfer from San Kin Yip International Trading Corporation's Riggs National Bank account to Manlin Foung's Travis Federal Credit Union account, Aug. 15, 1996 (Ex. 68).
141 See Aug. 31, 1996 bank statement for account maintained by Manlin Foung indicating a balance on Aug. 15, 1996 (prior to receipt of the $10,000 wire) of $5,378.95 (Ex. 69).
142 See $10,000 check to ''Birthday Victory Fund'' drawn on Manlin Foung's Travis Federal Credit Union account, August 15, 1996 (Ex. 70). Foung testified to this and another conduit contribution in an October 5, 1997 hearing before the House Government Reform and Oversight Committee. ''Three Witnesses Say That They Helped to Launder Contributions to Democrats,'' Wall Street Journal, Oct. 6, 1997, p. A4. Foung's other DNC contribution, $12,500 on February 18, 1996 (Ex. 71), was reimbursed by Amerasia Bank cashier's checks (Ex. 72) purchased in cash by former Lippo Group executive and Trie associate Antonio Pan (Ex. 73). The Committee has been unable to determine the source of the cash used by Pan for the purchase of the cashier's checks.
The ultimate source of the funds used by San Kin Yip for its wire transfer to Foung was a $200,000 wire transfer on August 7, 1996, from the Bank of China, Macau branch account of Cia de Investimento e Fomento Predial Goodwill Limitada, an Ng-affiliated company, to Trie and Ng's joint account at Riggs National Bank. (note - 143) The balance in Trie and Ng's joint account prior to the wire transfer was only $1,118. (note - 144) $90,000 was then transferred, in two installments, from Trie and Ng's account to San Kin Yip's account. (note - 145) The balance in San Kin Yip's account before the deposit of $90,000 was only $1,029,(146( obviously insufficient to cover the $10,000 wire transfer to Foung.
143 See confirmation of $200,000 wire transfer from Cia de Investimento e Fomento Predial Goodwill Lda's Bank of China, Macau branch, account to Ng Lap Seng and Charlie Trie's Riggs National Bank account, Aug. 7, 1996 (Ex. 74); see also discussion of the Committee's confirmation of a connection between Cia de Investimento e Fomento Predial Goodwill Lda and Ng Lap Seng, supra, footnote 74.
144 See Sept. 5, 1996 bank statement for account maintained by Ng Lap Seng and Charlie Trie indicating a balance on Aug. 5, 1996 (prior to receipt of the $200,000 wire) of $1,118.32 (Ex. 75).
145 See confirmation of $40,000 transfer from Ng and Trie's Riggs National Bank account to San Kin Yip International Trading Corporation's Riggs National Bank account, Aug. 7, 1996 (Ex. 76); confirmation of $50,000 transfer from Ng and Trie's Riggs National Bank account to San Kin Yip International Trading Corporation's Riggs National Bank account, Aug. 15, 1996 (Ex. 77); see also Aug. 31, 1996 bank statement for account maintained by San Kin Yip International Trading Corporation indicating deposits of $40,000 on Aug. 7, 1996 and $50,000 on Aug. 15, 1996 (Ex. 78).
146Ex. 78. Attempts to Convert Political Connections to Personal Gain
According to the Little Rock residents interviewed by the Committee, Trie's contributions and fundraising were motivated by his expectation that important political connections would ultimately prove of financial benefit. (note - 147)
147 See Webb interview, p. 1; Shaffner interview, p. 2.
Trie's efforts appear to have established at least the important political connections that he sought. White House WAVES records indicate that Trie visited the White House at least twenty-two times from the period 1993 to 1996(148( and that Ng Lap Seng also visited the White House ten times between 1994 and 1996. (note - 149)
148 See White House WAVES records for Charlie Trie's White House visits, 1993 1996 (Ex. 79).
149 See White House WAVES records for Ng Lap Seng's White House visits, 1994 1996 (Ex. 80). Although the Committee requested White House WAVES records for Ng on May 21, 1997, the White House delayed production of this information until the afternoon of July 29, 1997, after the completion of testimony relating to the Ng-funded DNC contributions made by Trie. See section of this Report on the uncooperative and manipulative tactics adopted by the White House in its production of documents to the Committee. Trie contributions and fundraising made him a DNC Managing Trustee(150( and member of the DNC's National Finance Board of Directors,(151( and afforded him VIP treatment at DNC events. (note - 152) His contributions also purchased admission to a number of fundraising events attended by President Clinton. His May 1994 contribution of $100,000, for instance, purchased two tables at a June 1994 DNC dinner and fundraiser at the Mayflower Hotel in Washington. (note - 153) Ng Lap Seng and a number of Chinese and Taiwanese businessmen and their spouses attended the event as Trie's guests. (note - 154) Trie also co-chaired a Presidential Birthday Celebration at the Sumner Wells Estate in August 1994,(155( and attended a February 1996 presidential fundraiser at the Hay-Adams Hotel in Washington. (note - 156) Finally, Trie and Ng organized an October 18, 1995 reception for former Commerce Secretary Ron Brown and several prominent Asian businessmen at the Shangri-La Hotel in Hong Kong. (note - 157)
150 See Letter from Ari Swiller to Charlie Trie welcoming Trie to the DNC's Trustee Program, June 30, 1994 (Ex. 81).
151 See Letter from Terry McAuliffe to Yah Lin Trie inviting Trie to become a member of the National Finance Board of Directors, September 21, 1994 (Ex. 82).
152 See Memorandum from David Mercer to John O'Hanlon summarizing requests from VIPs such as Yah Lin Trie, June 18, 1994 (Ex. 83).
153 See Memorandum from Charlie Trie/Jody Webb to David Mercer identifying Trie's invitees to next day's dinner, June 21, 1994 (Ex. 84).
154 See id.
155 See Letter from Bill Clinton to Yah Lin ''Charlie'' Trie, October 3, 1994 (Ex. 85).
156 See Letter from Vanessa Weaver to Yah Lin Trie, February 21, 1996 (Ex. 86).
157 See, e.g., Memorandum of Interview of Edmund Ho, July 27, 1997, p. 2. Press reports have suggested that Trie solicited contributions for the DNC at the reception. See, e.g., Kevin Sack, ''From Restaurateur to Intimate at the White House,'' New York Times, Jan. 4, 1997, p. A8. The Committee, however, interviewed several of the individuals who attended the reception, and none reported that they had been solicited for a contribution. The event simply offered Trie and Ng an opportunity to demonstrate to prominent Asian business associates an intimate level of access to the Clinton Administration.
After establishing political connections through contributions and fundraising, Trie sought to convert those connections to personal gain. (note - 158) Trie sought to use his political connections to secure financing for a real estate development project planned by Ng in Macau. The Committee also believes that Trie's efforts led to his otherwise unwarranted appointment by the President to the Commission on United States-Pacific Trade and Investment Policy.
158To the extent that the political connections established through Trie's contributions and fundraising motivated Ng to continue his financial support of Trie, this would appear to be Trie's most successful conversion of political access to personal financial gain. Cf. Hearing Transcript, July 29, 1997, pp. 88 89 (''Senator Bennett: . . . I think Mr. Wu got what he paid for here. He was not particularly interested in making money in Little Rock. He was interested in establishing his own credentials or the credentials of his man in the United States, if Mr. Trie would be so characterized, as having very high-level contacts. It has been my personal experience that this is very valuable. It can open a lot of doors in a lot of places in ways that American business people simply do not understand because we do not do business that way in the United States. I can understand why Mr. Wu was willing to put that much money into Mr. Trie's hands, and I can clearly understand why Mr. Wu was perfectly willing to allow Mr. Trie to use that money to make a series of political contributions in order to keep the invitations to the White House open.'').
On April 22, 1996, President Clinton announced the appointment of sixteen individuals to the newly created Commission on the United States-Pacific Trade and Investment Policy (''the Commission''). (note - 159) Among the sixteen individuals was Charlie Trie. (note - 160) Several circumstances surrounding Trie's appointment to and involvement with the Commission, however, indicate that Trie's political contributions and fundraising were critical factors in the Administration's decision. (note - 161) As discussed below, after Trie expressed his interest in joining the Commission, even the existence of an already full slate of candidates, a disqualifying financial interest in the business of the Commission, and (according to several Commission members interviewed by Committee investigators) a lack of substantive merit did not prevent Trie from participating.
159 See List of Commission Appointees, April 22, 1996 (Ex. 87).
161At the time of Trie's appointment to the Commission, he had contributed a total of $205,000 to the DNC. (Trie contributed an additional $15,000 to the DNC between his appointment to the Commission and the November 1996 federal elections.) See supra, footnotes 59 69 and accompanying chart. The announcement of Trie's appointment to the Commission also fell only one month after Trie delivered his first installment of contributions (a delivery totaling $460,000) to the Presidential Legal Expense Trust (''PLET''). The Committee believes that Trie's successful solicitation of contributions for the PLET may also have played a prominent role in Trie's appointment to the Commission. See section of this Report on Trie's involvement as a fundraiser for the PLET.
The 15-member Commission on United States-Pacific Trade and Investment Policy was created on June 21, 1995, when President Clinton issued Executive Order 12964(162( and fulfilled a promise made to Senator Jeff Bingaman who insisted on the formation of the Commission in return for his support of the creation of the World Trade Organization. (note - 163) The purpose of the Commission was to prepare a report that would advise the President ''on the steps the United States should take to achieve a significant opening of Japan, China and other Asian and Pacific markets to U.S. business.'' (note - 164)
16231 Weekly Comp. Pres. Doc. 1095.
163 Id.; see also Memorandum of Interview of Clyde Prestowitz, Jr., June 13, 1997, p. 1. Prestowitz, president of Washington's Economic Strategy Institute, told the Committee that he recommended to Senator Bingaman the idea of insisting on the creation of the Commission in return for his vote in favor of the Uruguay Round GATT agreement.
164Executive Order 12964, Section 2, 31 Weekly Comp. Pres. Doc. 1095.
In the months following the creation of the Commission, the White House selected a group of chief executives, academics and Asian specialists to fill the fifteen available slots. (note - 165) Trie's name, however, was not included among the individuals initially considered for appointment. (note - 166) Rather, Trie's name was added in the fall of 1995 only after he expressed an interest in participating, and only after White House officials made it clear that Trie's selection was a priority. (note - 167) Trie's appointment also carried with it the endorsement of the DNC,(168( to which Trie and his businesses had contributed $192,500 in 1994 and 1995. (note - 169)
165Glenn F. Bunting, ''White House Helped Boost Trie onto Asia Trade Panel; Donations: Clinton Friend Won New Spot with a Padded Resume. Subject of Fund-raising Inquiry Now in China,'' Los Angeles Times, July 20, 1997, p. A1.
166 Id.; see also Memorandum from Ira S. Shapiro to Mickey Kantor, January 20, 1995 (Ex. 88).
167 Id.; see also Memorandum from Phyllis Jones to Mickey Kantor attaching list of appointees to the Commission, November 21, 1995 (Ex. 89).
168 See Electronic Mail Message from Phyllis Jones to Jennifer Hillman, September 21, 1995 (Ex. 90).
169Trie and his businesses contributed an additional $27,500 to the DNC in 1996. See supra, footnotes 66 69 and accompanying chart.
In order to accommodate the White House's interest in the inclusion of Trie without eliminating any of the fifteen individuals originally selected for appointment to the Commission, the President issued Executive Order 12987 on January 31, 1996, expanding the membership of the Commission to ''up to 20.'' (note - 170)
17032 Weekly Comp. Pres. Doc. 134.
After completion of a preliminary background check on each of the individuals considered for appointment to the Commission,(171( the appointees were asked to submit a financial disclosure report in order to identify potential conflicts with the Commission's work. (note - 172) Trie's financial disclosure report revealed that he received a total annual salary of $97,500 from his Little Rock-based international trading company, Daihatsu International Trading, and from Ng Lap Seng's San Kin Yip International. (note - 173) Trie also reported ownership of $22,000 worth of stock in Walmart. (note - 174) Officials of the United States Trade Representative's office who reviewed Trie's disclosure report found that Trie's position on the Commission could have a ''direct and predictable effect'' on his interests in Daihatsu, San Kin Yip, and Walmart and that he thus possessed ''a disqualifying financial interest.'' (note - 175)
171 See Memorandum from Winston Allen to Marvin Krislov requesting a preliminary background investigation of Trie, December 15, 1995 (Ex. 91). The FBI's investigation of Trie (a ''name check'' of criminal and intelligence databases) did not uncover any information to cause the White House to reconsider Trie's appointment. See Memorandum from Marvin Krislov to Bob Nash announcing completion of Trie's background investigation, February 5, 1996 (Ex. 92).
172 See Confidential Financial Disclosure Report of Yah Lin Trie, March 11, 1996 (Ex. 93). USTR Assistant General Counsel Barbara Fredericks noted Trie's failure to sign the report and promised to correct the deficiency. See Letter from Barbara Fredericks to Laura Sherman, April 17, 1996 (Ex. 94). A signed version of the report, however, has not been produced to the Committee.
173 Id.; see the discussion of these companies above.
175 See Letter from Laura Sherman to Charlene Barshefsky, May 9, 1996 (Ex. 95); see also 18 U.S.C. 208(a) (prohibiting Government employees from rendering advice with respect to issues in which they have a financial interest).
U.S. Trade Representative Charlene Barshefsky, however, possessed the authority to waive Trie's conflict upon a finding that the ''need for [Trie's] services outweigh[ed] the potential for a conflict of interest created by the financial interest involved.'' (note - 176) USTR officials therefore drafted a waiver memo for Barshefsky's signature stating that Trie ''possesse[d] special expertise vital to the work of the Commission,'' and that his participation was ''essential to the United States.'' (note - 177)
17618 U.S.C. 208(b)(3).
Although Barshefsky refused to sign the memo waiving Trie's conflict, Trie was ultimately permitted to participate as a member of the Commission without a waiver (or other resolution of the potential conflict). (note - 178) According to the Los Angeles Times, a USTR official explained that the paperwork on Trie simply ''fell through the cracks.'' (note - 179)
178 Glenn F. Bunting, ''White House Helped Boost Trie onto Asia Trade Panel; Donations: Clinton Friend Won New Spot with a Padded Resume. Subject of Fund-raising Inquiry Now in China,'' Los Angeles Times, July 20, 1997 p. A1.
Trie attended most of the early Commission meetings and traveled with Commission members on a member-funded, 10-day trip to Asia in September 1996. (note - 180) While Commission members acknowledged that Trie's contacts in and familiarity with many of the Asian cities they visited made him a valuable addition to their fact-finding trip, 181 most were far less complimentary of Trie's substantive input to the work of the Commission. (note - 182) Trie submitted a report to the Commission containing his own recommendations 183 that members dismissed as superficial, grammatically deficient, and generally unhelpful. (note - 184)
180 See Memorandum of Interview of Dr. Meredith Woo-Cummings, June 25, 1997, pp. 1 2.
181 See, e.g., Prestowitz interview, p. 2.
182 See Woo-Cummings interview, p. 1 (Trie was ''clearly [in] 'over his head' on the Commission''); Memorandum of Interview of Bruce Stokes, June 30, 1997, p. 2 (''Trie did not contribute very much to the Commission's efforts.''); Memorandum of Interview of Jason S. Berman, p. 2 (''Trie was not involved in any way in drafting the final report.'').
183 See ''Recommendations for what we can do in U.S.-Asia Trade Policy Formulation,'' August 1, 1996 (Ex. 96). As the face of Trie's report reflects, the report was actually drafted by Chu Lei, not by Trie himself. Chu Lei is an American citizen currently residing in Taiwan. In addition to assisting Trie with his report to the Commission, Chu also introduced Trie to Master Suma Ching Hai, the leader of the Buddhist sect that was the source of the almost $700,000 in contributions that Trie brought to the PLET. See Memorandum of Interview of Chu Lei, July 8, 1997, pp. 1 2; see also section of this Report on Trie's involvement as a fundraiser for the PLET.
184 See, e.g., Woo-Cummings interview, p. 2 (describing Trie's report as ''completely incomprehensible'').
Trie's active participation on the Commission ended in late 1996 when his name surfaced in connection with campaign fundraising improprieties. 185 After Trie fled the United States for China, he sent a letter to the Commission apologizing for the impact of the scandal on the Commission's work and expressly stating that he would no longer be participating in Commission activities. (note - 186) However, in spite of the well-publicized allegations about Trie's fundraising improprieties and his withdrawal from participation on the Commission, the Administration never formally revoked Trie's appointment, and he remained a member until the Commission submitted its final report in April 1997.
185 See Glenn F. Bunting, ''White House Helped Boost Trie onto Asia Trade Panel; Donations: Clinton Friend Won New Spot with a Padded Resume. Subject of Fund-raising Inquiry Now in China,'' Los Angeles Times, July 20, 1997 p. A1.
186 See id.
Finally, Trie sought to use his DNC contributions to benefit Ng financially. In a letter to Ng dated June 4, 1995, Trie expressly stated his belief that his involvement in the DNC could ''assist in the development and success'' of a real estate development project planned by Ng in Macau. (note - 187) Trie's DNC contacts, in fact, worked precisely as Trie envisioned. DNC Deputy Finance Chairman David Mercer and Department of Commerce employee Jude Kearney introduced Trie to Ernest Green of Lehman Brothers, 188 and Trie later discussed with Green Lehman Brothers'' interest in financing a development project planned by Ng in Macau. (note - 189) In early 1995, Mercer again sought to assist Trie with further potential investment banking connections. (note - 190) While Trie's lack of business success indicates that he was ultimately unable to use these connections to his financial advantage, he did try.
187 See Letter from Yah Lin ''Charlie'' Trie to Ng Lap Seng, June 4, 1995 (Ex. 97).
188 See Deposition of Ernest Green, June 18, 1997, pp. 11 13.
189 See id., pp. 17 18.
190 See Memorandum from David Mercer to Charlie Trie, January 30, 1995 (Ex. 98). Mercer testified that he provided this sort of personal assistance to Trie because Trie was a DNC ''supporter,'' and that to be an effective fundraiser for the DNC, he always sought to be ''responsive'' to supporters. Deposition of David Mercer, May 14, 1997, pp. 23 24. Mercer also testified that he attended social events with Trie, including a party at Trie's Watergate apartment celebrating the opening of the 1996 Olympics. Id. , pp. 43, 45. Need for an Independent Counsel
Three individuals have now been indicted on charges based wholly or in part on their dealings with this Committee or from evidence revealed by this Committee. At least two of these individuals, Yah Lin ''Charlie'' Trie and Maria Hsia, have close ties to covered persons under the Independent Counsel Act. As noted above, Trie contributed $220,000 to the DNC and reimbursed the contributions of other contributors Trie recruited to disguise the original source of the contributions, and he did the same with respect to the Presidential Legal Expense Trust. Trie visited the White House twenty-two times. Trie also attended numerous fundraisers at which the President or Vice President were present, access purchased through his sizeable contributions and used to further his personal business. This access seeking formed one of the bases for the Justice Department's indictment of Trie on conspiracy charges.
Maria Hsia was a personal friend and political supporter and fundraiser for the Vice President since 1988. Hsia was instrumental in inviting then-Senator Gore on a trip to Taiwan through the partial auspices of the Fo Kuang Shan Order. Hsia raised tens of thousands of dollars for Gore's 1990 Senate reelection campaign. Hsia also used the ''tally'' system to direct DNC funds to Gore's Senate reelection campaign. After Gore became Vice President, Hsia laundered funds through Hsi Lai Temple monastics to arrange for Vice President Gore's chief of staff to meet with the head of China Resources. In 1996, Hsia was a prominent arranger of the DNC fundraiser that Vice President Gore attended at the Hsi Lai Temple. The Justice Department's indictment lists as part of Hsia's conspiracy to defraud the Federal Election Commission Hsia's money laundering at that event, as well as other events attended by Vice President Gore or President Clinton.
Both Hsia and Trie have close relationships with the Chinese government and/or intelligence agencies, according to the United States intelligence or investigative agencies.
Based upon the record before this Committee, we can only assume that many more indictments will be forthcoming. These indictments of people with close ties to the Administration illuminate an inherent problem that the Justice Department has in trying to pursue these cases--a problem that has come into fruition. These cases present an inherent conflict of interest and an appearance of a conflict of interest that the Department of Justice cannot escape.
In these cases, the Justice Department will be faced with the following considerations, considerations that are present in all federal criminal prosecutions;
--deciding whether to enter into plea bargaining negotiations and whether to accept a plea bargain;
--deciding whether the defendant is cooperating fully and fulfilling the plea bargain, and specifically, deciding whether the defendant is telling all that he or she knows;
--deciding whether to grant immunity and, if so, deciding whether or not the defendant is telling all that he or she knows pursuant to that immunity agreement.
In any such case, when the citizens of this country have returned an indictment, it is the prosecutor's obligation to be fair to the defendant but to be tough in representing the public interest. For example, in any such case where any deal has been struck, the prosecutor must ask the defendant tough questions and use appropriate prosecutorial resources to determine whether the defendant is cooperating fully. If the defendant's superior or close associate is the subject of accusations or well-placed suspicions, the prosecutor must be aggressive in determining whether or not the defendant has any information about such an individual. And the prosecutor cannot usually accept a simple denial without further inquiry. Should the individual about whom the defendant may have information be a public official, the above process is even more important. This is true whether the public official in question is a mayor, a governor, a member of Congress or the President. That fact forms the basis for the existence of a ''public integrity section'' in the Justice Department.
The problem in these cases is that the Attorney General works for the President. This is the very kind of situation that is addressed in the ''political conflict'' provision of the Independent Counsel Act. (note - 28) U.S.C. 591(c)(1). As the public sees these defendants processed and sees any deals worked out by the Justice Department and the defendants, the Justice Department will bear a very heavy burden in convincing the American people that the decisions the Department made were appropriate and fully protective of the interest of justice.
For this reason, an independent counsel should be appointed to remove the Department of Justice from this clear ''political conflict of interest'' which burdens the Justice Department and for which Congress provided a solution.
As a result of generous contributions and successful fundraising, Charlie Trie established himself as a key player in the DNC's finance operation, opened the doors of the White House for himself and Ng Lap Seng, and secured for himself an appointment to the Commission on U.S.-Pacific Trade and Investment Policy. (note - 191) The Committee has concluded, however, that Trie's unsuccessful international trading business could not support the contributions that allowed him the access that he obtained. Rather, Trie relied on a continuous stream of illegal funds that he received by wire transfer from Ng Lap Seng's bank accounts in Hong Kong and Macau. The source of Ng's funds and what he or those behind him hoped to gain through Trie remain unknown.
191 See section of this Report on Trie's involvement as a fundraiser for the PLET.
CHARLIE TRIE'S CONTRIBUTIONS TO THE PRESIDENTIAL LEGAL EXPENSE TRUST I. INTRODUCTION
Charlie Trie's contributions to the Presidential Legal Expense Trust (the ''Trust'') further illustrate the manner in which Trie raised foreign money, as well as his close ties to the White House and the President. Unlike contributions to the Clinton/Gore campaign or the DNC, contributions to the Trust inured directly to the personal financial benefit of President Clinton and the First Lady. The money was used to pay their personal legal bills. Because such contributions are even more susceptible to abuse than ordinary campaign contributions, the Committee looked closely at Trie's activities with respect to the Trust and the White House's knowledge of and response to those activities.
In March 1996, Trie personally delivered almost one half million dollars in checks and money orders to the Trust. Trust representatives and White House officials recognized almost immediately that the donations were highly questionable and appeared, at least in part, to have been coerced from members of a controversial Buddhist sect. However, rather than simply returning the suspect donations and publicly reporting such returns--which had been the Trust's historical practice--the Trust, in consultation with senior White House officials, hid the returned donations by changing the format of the Trust's bi-annual public disclosure form. This avoided public disclosure of any information concerning the Trie donations prior to the 1996 presidential election.
Moreover, when the Trust finally sent the donations back to the Trie-related contributors, it did so with a twist. It invited these contributors to recontribute their money, notwithstanding the fact that they knew a substantial amount of the money had been coerced from these very donors in the first place. Not surprisingly, once Charlie Trie's close association with James Riady, John Huang and the entire DNC fundraising matter became public through press reports in October 1996, the Trust and White House senior officials quickly determined that the ''recontributions'' should also be returned--this time with no strings attached. However, neither the White House nor the Trust publicly disclosed the Trie/Trust connection or the strange origin of the donations until after the election and even then only because they were forced to do so by a threatened press story.
These questionable facts alone were cause for concern by the Committee, but the Committee also found other equally disturbing facts concerning Trie's relation to the Trust and the White House. For example, despite the fact that the Trust, with White House permission, had hired a private investigative firm to investigate the Trie donations, the one person the investigative firm was instructed not to speak with was Charlie Trie. This, despite the fact that Trie was obviously the central figure, and his office and the private investigative firm were located only blocks apart in Washington, DC, making an interview with him a simple matter. Likewise, even though they were well aware of the suspicious nature of his fundraising for the Trust, no one at the White House took any action prior to the election to inquire about Trie's simultaneous fundraising for the DNC. (note - 1) This despite the fact that (a) Trie was known to be a major DNC donor (a Managing Trustee); (b) he had told Trust representatives in his first visit that he was organizing a major DNC fundraiser; and (c) he was a frequent guest at the White House. This was particularly strange with respect to Deputy White House Chief of Staff Harold Ickes who helped manage the DNC on a daily basis, knew Trie was involved in raising money for the Democratic party and was one of the first to know about Trie's involvement with the Trust.
1The DNC ultimately returned $645,000 either contributed or raised by Charlie Trie.
Perhaps most alarming was the fact that the senior White House officials who were being consulted about Trie's involvement with the Trust claimed to know little or nothing about Trie, while at the very same time Trie was receiving several favors from the White House and socializing with the President. For example, in February 1996, just weeks before Trie collected the Trust donations from the Buddhist sect, he was successful in gaining admission to a White House coffee with the President for Wang Jun, a Chinese arms merchant. The President subsequently admitted his meeting with Wang Jun was highly improper. Likewise, during this same time frame, Trie was being considered for a Presidential appointment to the Commission on U.S. Pacific Trade and Investment Policy. In fact, he was named to the Commission within four weeks after he delivered the first batch of donations to the Trust. Finally, on the very same day that he delivered the first batch of donations to the Trust, a letter authored by Trie was sent by former White House aide Mark Middleton to the President expressing Trie's concern and advice regarding Taiwan/China relations. The letter sparked a flurry of activity at the National Security Council and eventually resulted in a detailed written response signed by the President. This was particularly curious given the fact that Middleton apparently was the person who directed Trie to the Trust in the first place. Middleton has asserted his Fifth Amendment rights and has refused to cooperate with the Committee.
II. The Presidential Legal Expense Trust--Background
The Trust was established on June 28, 1994 to raise funds to help the President and First Lady pay personal legal bills arising from lawsuits and investigations initiated after Mr. Clinton became President. (note - 2) The Trust was governed by a number of guidelines concerning the source and types of contributions that could be accepted. The guidelines generally followed Federal Election Commission rules governing donations to federal candidates. The following is a list of some of the requirements regarding donations to the Trust as included in the February 22, 1996 bi-annual report of the Trust:
2July 1996 Bi-annual Report of the Trust, August 13, 1996 (Ex. 1). On December 31, 1997 the Trust ceased operations as a result of a lack of contributions sufficient to cover its expenses. 1. Contributions are accepted only from individual U.S. citizens, other than federal employees or registered lobbyists. Each person must make his or her own contribution using personal funds. Each contribution must be made voluntarily. 2. Contributions are not accepted from corporations, labor unions, partnerships, political committees or other entities. 3. Individual contributions are limited to a maximum of $1,000 per eligible individual per calendar year.
4. Anonymous contributions will not be accepted. 5. Each contributor should provide his or her name, address and telephone number. In addition, a donor contributing $200 or more should provide his or her occupation and employer's name. 6. The Trust will acknowledge contributions and make periodic public reports of the Trust contributors. (note - 3)
3January 1996 Bi-annual Report of the Trust, February 22, 1996 (Ex. 2).
Once the Trust was established, a distinguished group of trustees was chosen to administer the Trust. The individuals named as Co-Chairs of the Trust were Rev. Theodore M. Hesburgh, President Emeritus of Notre Dame University, and former Attorney General Nicholas deB. Katzenbach. The other Trustees named were John Brademas, former Indiana Congressman and President Emeritus New York University; Barbara Jordan, former Texas Congresswoman; Ronald L. Olson, Los Angeles lawyer; Elliot L. Richardson, former Attorney General, Secretary of Defense and Secretary of Health, Education and Welfare; Michael Sovern, President Emeritus of Columbia University; and John C. Whitehead, former Deputy Secretary of State.
Michael Cardozo was named Executive Director of the Trust in June, 1994 after being contacted by White House counsel Lloyd Cutler and meeting with the President to discuss the job. Cardozo had been active in Democratic politics for many years. He was a former Deputy White House Counsel under President Carter, served on the Credentials Committee of the 1972 Democratic Convention, and was Vice-Chair of the Clinton-Gore Inaugural Committee in 1993 and again in 1997. Currently he is the managing director of G. William Miller & Co., an investment banking firm. (note - 4) 4Deposition of Michael Cardozo, May 7, 1997, pp. 5 7.
Cardozo's role was primarily to assist in the submission of quarterly and bi-annual reports to the President and First Lady, oversee the public release of the bi-annual report, keep the Trustees informed of the activities of the Trust, act as a liaison between the Trust and the White House, and oversee the day-to day work of the Trust, most of which was delegated to the Administrative Assistant, Sally Schwartz. (note - 5) Schwartz's responsibilities primarily consisted of reviewing contributions, maintaining a data base, sending out acknowledgments, preparing reports both for the Trustees and the Executive Director and also for the public briefings. (note - 6)
5Ms. Schwartz served as Administrative Assistant from August 1995 until the Trust was closed. The Administrative Assistant was the only full time, paid employee of the Trust. Deposition of Sally Schwartz, May 6, 1997, p. 11. 6 Id. As of the period ending December 31, 1995, the Trust had received a total of $993,476 in donations since its inception and had paid a total of $541,134.24 of the President's legal expenses. As of that time $1,360,063.95 in legal expenses remained outstanding. (note - 7) 7 See Ex. 2.
III. Charlie Trie's March 21, 1996 Visit to the Trust
Trie's first visit to the Trust on March 21, 1996 is important in several respects. The amount of donations Trie delivered, nearly half a million dollars, represented almost fifty percent (50%) of the money raised by the Trust since its inception and, thus, as Cardozo acknowledged was an ''enormous'' event in the life of the Trust. Additionally, in the first meeting Trie represented that he was an acquaintance of the President from Little Rock, was organizing a DNC fundraiser expecting to raise $1 million, and was also in the process of being appointed to a federal commission by the President. Trie also repeatedly insisted on confidentiality concerning his role in delivering the donations.
According to Cardozo's testimony, Trie first called Cardozo on March 20, 1996 at his business office to set up the initial meeting. (note - 8) Cardozo informed Trie that he could answer any questions about the Trust over the telephone, but Trie insisted that they meet in person. The two met the next day at Cardozo's office at G. William Miller & Co., which was located across the street from the offices of the Trust. Trie began their meeting by telling Cardozo about his personal background and the fact that he had owned a Chinese restaurant in Little Rock that was frequented by then-Governor Clinton. Trie told Cardozo that he had heard about Mr. Clinton's mounting legal bills and had set about trying to help. Trie then retrieved a manilla envelope from beside his chair, turned it up over the table, and according to Cardozo, ''out came a mound of checks and money orders.'' (note - 9) According to Trie the total amount of the checks and money orders was $460,000. (note - 10)
8Trie's background and connection to the DNC are discussed above in the section on Charlie Trie's fundraising for the DNC. 9Deposition of Michael Cardozo, May 7, 1997, p. 34. 10 Id.
After seeing the ''mound'' of checks and money orders, Cardozo called Ms. Schwartz at the Trust's offices and asked her to come to the meeting so that he could have another witness. At Cardozo's request, Ms. Schwartz brought with her a fact sheet, a sample of the Trust's bi-annual publication of donors and several other documents which reflected how the Trust reported donations. (note - 11) Cardozo wanted to show these documents to Trie to impress upon him that the donations would be made public. (note - 12) 11 Id. at p. 35. 12 Id. at pp. 38 39.
Schwartz arrived at the meeting in less than five minutes. During the meeting, Trie told Cardozo and Schwartz that he was helping to organize a major fund raiser for the DNC which would raise $1 million. (note - 13) Trie told Cardozo and Schwartz that he had a lunch appointment at the Palm Restaurant next door and that he would return after the lunch. Cardozo and Schwartz used this period of time to review the checks and money orders more closely. (note - 14) 13 Id. at pp. 43 44. 14 Id. at p. 38.
While Trie was at lunch, Cardozo conducted a conference call with Mr. Katzenbach, co-chair for the Trust, and Bernard Aidenoff, counsel to the Trust. The three decided that if the checks appeared to be valid on their face they should be deposited into the Trust's bank account. (note - 15) Cardozo and Schwartz studied the checks and money orders and determined that approximately $70,000 were deficient. For example, some of the checks were missing names, addresses, or were for an amount in excess of the Trust's guidelines. (note - 16) 15 Id. at p.48. 16 Id. at p.54 55; Deposition of Sally Schwartz, May 6, 1997, p.40.
Upon Trie's return from his lunch at the Palm, Cardozo and Schwartz returned the deficient checks to him. Trie appeared confident that he could cure the deficiencies. (note - 17) During this discussion, Trie stated that he did not want his name mentioned in connection with the contributions. Trie told them that he was going to be appointed to a federal commission and was not sure that he was eligible to make a donation. (note - 18) Trie even balked at the idea of mailing the valid checks and money orders to the bank because he did not want to put his name and return address on the envelope. Accordingly, Trie and Schwartz personally delivered the contributions to the Trust's lock box at NationsBank. (note - 19) After depositing the funds in the Trust's lock box, the Trust decided to put them into an interest bearing money market account, commingled with other contributions. The donations were listed as ''unrestricted'' on internal Trust accounting documents, and were deemed accepted according to the Trust's own accounting procedures. (note - 20) 17Deposition of Michael Cardozo, May 7, 1997, pp. 54 55. 18 Id. at pp. 41 42. 19Deposition of Sally Schwartz, May 6, 1997, pp. 41 42.
20Deposition of Michael Cardozo, May 7, 1997, pp. 241 245; Profit and Loss Statement for the Trust, June 12, 1996 (Ex. 3). A. The Role of Mark Middleton/White House favors for Trie
At some point during the March 21st meeting, Trie stated that he had gotten Cardozo's name from Susan Levine and had been directed to Levine by Mark Middleton. (note - 21) Susan Levine is an acquaintance of Cardozo's, and has worked at both the DNC and the White House during the Clinton Administration. (note - 22) Middleton formerly worked at the White House as an advisor to former White House Chief of Staff Thomas ''Mack'' McLarty. After leaving the White House, Middleton formed Commerce Corp., International, a company focused on international trade with Asia. Middleton is currently under investigation regarding his business transactions in Asia, his fund raising for the Clinton Birthplace Foundation and his connections to Trie. It has been widely reported in the press that Middleton and Trie were very close and traveled together to Taiwan. (note - 23) 21Deposition of Loren Berger, June 23, 1997, pp. 44 45. 22Deposition of Michael Cardozo, May 7, 1997, pp. 30 31.
23''Mark Middleton; White House Staff,'' USA Today, February 27, 1997, p. 6A.
It is unknown whether Middleton knew--at the time he directed Trie to the Trust--of the questionable nature of the donations Trie would deliver. He has asserted his Fifth Amendment rights and refused to talk with Committee investigators. However, if he did know of the questionable origin of the contributions, it would explain why he directed Trie to the Trust as opposed to Clinton/Gore '96, or the DNC, where the contributions would have received much greater scrutiny and been subject to FEC guidelines.
In addition to steering Trie to the Trust, Middleton also helped Trie communicate with the President concerning China/Taiwan policy. Although Trie did not tell Cardozo or Schwartz with whom he was having lunch at the Palm on March 21st, National Security Council documents obtained by the Committee indicate that his appointment was almost certainly with Middleton. (note - 24) Trie's lunch appointment at the Palm was at noon. Middleton's office is across the street from the Palm. At 1:14 pm on the 21st--minutes after Trie's lunch ended--Middleton faxed a letter from Trie addressed to the President to Maureen Lewis at the White House who handles the President's personal correspondence. The letter was faxed from Middleton's office. These facts suggest that the letter was passed from Trie to Middleton at the Palm. The cover sheet of the fax stated in part, ''Dear Maureen: As you likely know, Charlie is a personal friend of the president from LR. He is also a major supporter. The president sat beside Charlie at the big Asian function several weeks ago.'' (note - 25)
24Letter from Charlie Trie to the President with fax cover sheet from Mark Middleton, March 21, 1996 (Ex. 4). 25 Id. at p. 1.
In the letter, Trie expressed concern over U.S. intervention in tensions arising from military exercises being conducted by China near the coast of Taiwan. Trie told the President in his letter that war with China was a possibility should U.S. intervention continue, . . . once the hard parties of the Chinese military incline to grasp U.S. involvement as foreign intervention, is U.S. ready to face such challenge . . . it is highly possible for China to launch real war based on its past behavior in Sino-Vietnam war and Zhen Bao Tao war with Russia. (note - 26) 26 Id. at pp. 2 3.
The National Security Council prepared a draft response to Trie's letter which was personally reviewed by National Security Advisor Anthony Lake and forwarded to the President for his signature. In his response letter, the President explained the U.S. objectives in the area and tried to ease Trie's concerns about the situation. (note - 27)
27Letter from the President to Charlie Trie and supporting memoranda, April 22, 1996 (Ex. 5).
While thousands of people write the President and receive reply letters carrying his signature, few people write letters that receive the kind of activity and attention within the NSC that Trie received. Without the testimony of Trie and Middleton, however, the Committee cannot determine whether the letter had any connection to the donations to the Trust and/or, more importantly, whether Trie was acting at someone else's direction when he wrote the letter to the President.
In addition to this exchange on China/Taiwan policy, Trie also received two other favors from the White House at or about the time of his donations to the Trust. First, as discussed in more detail above in the section on Charlie Trie, Trie was appointed by the President to the Commission on U.S. Pacific Trade and Investment Policy--an act which required the President to expand the Commission's size by signing an executive order. Trie was appointed to the Commission despite the fact that his qualifications did not remotely match those of the other members named to the Commission. (note - 28) Trie's appointment was also not made official until four weeks after his delivery of the donations to the Trust.
28List of names and occupations of members of the Commission, November 8, 1995 (Ex. 6).
Additionally, and as discussed more fully above, Trie was also successful in gaining admission to a White House coffee with the President for Chinese arms dealer Wang Jun. (note - 29) The coffee took place on February 6, 1996, just weeks before Trie began gathering the donations from the Buddhist sect that he would eventually deliver to the Trust. When it was revealed that the President had entertained Wang, who also serves as an advisor to the Chinese government, the President admitted that the meeting was ''clearly inappropriate.'' (note - 30) Without the cooperation of Trie or Wang Jun the Committee cannot determine whether Trie's fundraising for the Trust was connected in any way to Wang Jun's visit.
29 See previous portion of the section regarding Charlie Trie's fundraising for the DNC.
30''Sen. Thompson to Subpoena Delayed White House Files,'' The Washington Post, July 31, 1997. IV. April 4, 1996 White House Meeting with the First Lady and Harold Ickes
Following Trie's first visit on March 21, 1996, Cardozo and the Co-chairs of the Trust decided that the President and First Lady should be informed of the visit in order to notify them of the contributions as well as to see if they knew Trie. (note - 31) Accordingly, Cardozo scheduled a meeting on April 4 with Harold Ickes, White House Deputy Chief of Staff and the White House supervisor of the President's re-election effort, and Mrs. Clinton to discuss the Trie-related contributions to the Trust. Cardozo began the meeting by telling the First Lady that someone from Arkansas had delivered a large number of checks to the Trust and asked her to guess who it was. When she failed to do so, Cardozo mentioned the name Charlie Trie. Mrs. Clinton hesitated, then recalled him as the owner of a restaurant in Little Rock frequented by then Governor Clinton. Cardozo explained that the donations were primarily from Asian-Americans and that the co-chairs had decided to deposit the money and determine whether or not the checks and money orders were indeed eligible. Mrs. Clinton agreed that the Trust should be diligent in determining the eligibility of the contributions. (note - 32) In this regard, Cardozo mentioned that he had learned through his experiences during Watergate to be wary of individuals carrying bags of money in Washington,
31 Id . at p. 50.
32Deposition of Michael Cardozo, May 7, 1997, p. 102. . . . when people drop large sums of money off in manila envelopes in Washington, D.C., you've got to be very careful about how you handle those funds. (note - 33)
33 Id . at p. 73. Both he and Mrs. Clinton discussed their Watergate experiences during this April 4 meeting.(34(
34 Id . at pp. 73, 75.
Cardozo testified that he probably took a copy of the Trust's bi-annual report to the meeting. (note - 35) He concluded this, in part, because Harold Ickes' notes of the April 4th meeting include the notation ''Total contributions Less ineligible.'' (note - 36) The bi-annual report which the Trust released to the press every six months contained the following reporting line:
35 Id . at p. 78.
36Handwritten notes of Harold Ickes, April 4, 1996 (Ex. 7).
STATEMENT OF RECEIPTS AND EXPENDITURES
JULY 1, 1995 DECEMBER 31, 1995 Receipts: Total Contributions $107,739 Less Ineligible Receipts (2,202) Net Receipts 105,537 This entry noted the total contributions received in the six month reporting period as well as the contributions which were ineligible and, thus, returned. The existence of that particular language in the Ickes' notes is important because it likely indicates that at the April 4 meeting Ickes, Cardozo and Mrs. Clinton discussed the fact that even if the Trie-related contributions were returned, their existence would be easy to ascertain from the bi-annual report scheduled to be released in July 1996. Cardozo admitted that the returned contributions, if publicly disclosed, would have been a major press story.(37( As discussed more fully below, the Trust, with White House knowledge, subsequently changed its reporting format to omit any disclosure of returned contributions.
37Deposition of Michael Cardozo, May 7, 1997, pp. 141 142.
Cardozo could offer few other details about the April 4 White House meeting. He testified that he did not tell Ickes or the First Lady about Trie's Presidential appointment to the federal commission or his involvement in organizing the DNC fundraiser because he did not think they were important. (note - 38) Significantly, at the meeting Ickes apparently did not indicate any knowledge of Trie despite the fact that by most accounts Ickes ran the DNC from the White House and Trie was a DNC Managing Trustee. (note - 39)
38Testimony of Cardozo, July 30, 1997, p. 28.
39Meaning that he raised or contributed at least $100,000; see section of the report regarding White House control of the DNC. V. The Trust Investigates the Trie Donations
In the weeks following Trie's initial visit and Cardozo's April 4 meeting at the White House, Sally Schwartz reviewed the checks and money orders more closely to determine whether they met the Trust's guidelines. She found that some of the money orders were sequentially numbered (meaning they had been purchased at one location), but were filled out by people from different parts of the country. In addition, a number of the checks had the same misspelling of the word ''presidential,''--spelled instead ''presidencial.'' She also found that some of the checks were written by one person on behalf of another in violation of the Trust's guidelines. (note - 40)
40Deposition of Sally Schwartz, May 6, 1997, pp. 66 67.
Schwartz telephoned some of the donors directly to determine whether they had in fact given their own money. She was told about large meetings at which the contributions were gathered. Eventually she learned about a Buddhist organization, Ching Hai, which had hosted the meetings, and she became concerned that some of the donors may have been coerced into making donations. (note - 41) The more Schwartz looked into the Trie-related donations, the more it became apparent that the Trust needed outside help to investigate the matter.
41 Id . at p. 137. A. The Trust Hires Investigative Group Inc.
As a result of Schwartz's internal investigation, Cardozo determined that the Trust should hire the Investigative Group, Inc. (IGI), a private investigative firm, to investigate the donations. On April 22, 1996, Cardozo held a conference call with the Trustees to gain their consent to hire IGI. The Trustees consented, but also raised a number of concerns. Elliott Richardson, former U.S. Attorney General, observed that, from a political point of view that we have a relatively desultory fund with only a trickle of money coming in and suddenly a big wave of Asian-American money comes in, in the wake of a number of fairly visible administration actions involving Asia in general and Taiwan in particular. (note - 42)
42Transcript of Trustees' conference call, April 22, 1996, p. 2 (Ex. 8). Similarly, John Brademus, former Congressman from Indiana, raised the following concern: One question . . . I would raise, but I hope Terry Lenzner [of IGI] could look into is . . . do [the donors] have a common position or can we find if there is some leader of a group . . . that has views on let's say continuation of MFN [Most Favored Nation status] or termination of MFN . . . some political agenda behind what they are doing?(43(
43 Id . at p. 4. Mr. Cardozo responded, ''Well I think we can ask the Investigative Group to do that and I think at some point we can ask Mr. Trie to come to a meeting and share with him some of our concerns . . .'' Id . Ronald Olson, an attorney from Los Angeles, suggested that ''someone in the California Asian community and I would think the Taiwanese would be very, very prominent in this . . . I think I would try to get beyond Mr. Trie.''(44( Yet, despite the fact that these legitimate questions and concerns were raised by the Trustees, IGI was never requested to look into any of these matters.
44 Id . at p. 1.
Following the April 22 Trustee conference call, Cardozo and Darryl Libow, counsel for the Trust, met with Terry Lenzner and Garrick Tsui of IGI. Cardozo explained the events that had transpired at the Trust and asked IGI to investigate the Trie-related contributions. (note - 45) However, the one person Cardozo specifically instructed IGI not to talk to was Charlie Trie. (note - 46) Cardozo explained that one reason for this instruction was that the Trust was limited to a $5,000 investigation budget. (note - 47) However, he acknowledged that Trie's office in Washington, D.C. was only blocks from IGI and, thus, a visit by an IGI investigator would have cost very little,
45Deposition of Terry F. Lenzner, June 23, 1997, pp. 13 14.
46 Id . at p. 14.
47Deposition of Michael Cardozo, May 7, 1997, pp. 98, 104. Mr. Tipps : And on the matter of cost--by the way, Mr. Trie's office was at the Watergate office building, right? Mr. Cardozo : That's what his business card said. Mr. Tipps : Right. And IGI--I am not from Washington, but I believe it is on Connecticut Avenue? Mr. Cardozo : That's correct. Mr. Tipps : And that is about a $5 cab ride? Mr. Cardozo : That's correct. (note - 48)
48Cardozo testimony, p. 36. He also expressed a reluctance to talk with Trie because he was a friend of the Clintons.(49( Whatever the reason, the failure of those investigating the Trie-related donations to sit down with Trie and ask him directly about the donations--and specifically their origin and whether he was receiving anything in return--is one of the more curious and troubling facts related to this entire episode.
49Deposition of Michael Cardozo, May 7, 1997, p. 104.
Another strange, and as-yet-unexplained fact, uncovered by the IGI investigation was the possible role of longtime Clinton friend and Lippo Group associate Joe Giroir in the Trust matter. Loren Berger, an IGI investigator, interviewed Sally Schwartz as part of the IGI investigation. Berger's notes of the meeting indicate that at some point in the discussion about the Trie donations the name ''Joe Giroir'' was mentioned. The name appears in Berger's notes along with the name Mark Middleton. (note - 50) However, when deposed by Committee attorneys, neither Schwartz nor Berger could remember anything about Giroir or even the context in which his name was mentioned. Giroir is an attorney in Little Rock, Arkansas and a former partner of the First Lady with the Rose Law Firm. His company, Arkansas International Development Corp., is closely associated with the Lippo Group and the Riady family, and Giroir was active in trying to place John Huang at the DNC. The Committee's complete findings regarding Giroir are included elsewhere in this report.
50Handwritten notes from Loren Berger, undated (Ex. 9). B. The Rose of the Ching Hai Buddhist Sect
During its investigation, IGI conducted extensive computer information searches, interviewed numerous donors telephonically, and contacted several experts on cults and religious sects. Based on these efforts, IGI determined that Trie likely laundered some or all of the funds through members of the Ching Hai Buddhist sect to the Trust and that many sect members were, in fact, coerced into making the donations.
The Ching Hai Buddhist organization is headed by the Supreme Master Suma Ching Hai. According to IGI's findings and other published information, the Supreme Master studied Buddhism in Taiwan, where she maintains her headquarters. Aside from leading the sect, she also designs her own line of clothes and conducts fashion shows. (note - 51) She encourages her followers to make donations to and purchase items from Ching Hai. Notwithstanding her teachings to her followers to focus on the spiritual and not the material, IGI found that Suma Ching Hai generally travels and lives in an opulent style. Indeed, IGI reported that she is considered a fraud by many other Buddhist groups. (note - 52) IGI also reported on certain unconventional practices within the sect, such as the sale of the Supreme Master's bathwater to her followers (which she apparently claims has curative properties). (note - 53)
51Final report of IGI, stamped ''Draft,'' May 15, 1996, p. 5 (Ex. 10).
52 Id . at p. 4.
53 Id .
As a result of its interviews with experts who had studied the Ching Hai sect extensively, IGI learned that its members often donate sums to the organization greater than they can afford. (note - 54) IGI concluded that it was highly likely that the funds donated by members of Ching Hai to the Trust were not given voluntarily. (note - 55)
54Berger deposition, p. 24. 55Ex. 10.
IGI also discovered that the donors to the Trust were solicited by the Supreme Master at large meetings in Los Angeles, Houston and New York. Many of the members IGI interviewed said they did not have check books or sufficient funds with them at the meetings, so in some cases fellow members wrote checks on their behalf, and in other cases money orders were provided and people simply filled them out with their addresses and social security numbers. (note - 56)
56Berger deposition, p. 24.
For obvious reasons, the Committee looked closely at whether the Ching Hai members reimbursed the sect for the money orders they had filled out or whether the sect simply funneled its funds through its members to Trie and ultimately the Trust. The organizer of the Ching Hai meeting in New York, Zhi Hua Dong, addressed this issue when he testified before the Committee on July 31, 1997. C. Testimony of Zhi Hua Dong
Zhi Hua Dong is a computer systems administrator in the physics department at Columbia University. He served as the New York contact member for Ching Hai and was one of the organizers of a March 16, 1996 meeting of the group in New York. Dong testified before the Committee and explained how the donations were gathered at that meeting. A couple of days prior to March 16, Dong was contacted by one of the Supreme Master's assistants and told to purchase $20,000 in money orders and was assured that he would be reimbursed for the purchase. He was not told why the money was needed. Later the same day he received another call from the same individual and was told to purchase as many money orders as he could. After contacting a few other members from the New York area, Dong was able to purchase $70,000 in money orders. (note - 57)
57Testimony of Zhi Hua Dong, July 31, 1997, p. 151.
Dong testified that he and his wife met the Supreme Master Suma Ching Hai at Kennedy International Airport along with other sect members. (note - 58) Dong's wife, Tracy Hui, drove Charlie Trie and the Supreme Master into Manhattan. Dong followed in another vehicle. Upon arriving at the Ritz Carlton Hotel in midtown, Dong went up to the Supreme Master's room where he delivered the money orders he had been asked to purchase. At that time the Supreme Master explained to him that they were helping President Clinton raise funds for his personal legal expenses. Trie, who was to be initiated into the sect at the meeting, was also in the room and wrote down the full name of the Trust so that people would be able to spell it correctly on their money orders and checks. Before leaving, Dong observed the Master removing $20,000 25,000 from the stack of money orders for sect-related expenses. (note - 59)
58Deposition of Zhi Hua Dong, June 17, 1997, p. 49.
59Dong testimony, p. 153.
During the meeting that night, which was held at the Inn at 57th Street, the Supreme Master addressed about 150 new initiates, all U.S. citizens, and told them that President Clinton was a good person and needed their help. After requesting them to contribute to the Trust, the Master turned to leave the room and to go downstairs to a private meeting. When some of the new initiates tried to follow her, she turned and in an angry tone told them to stay put and attend to business. (note - 60) When one of the followers tried to ask a ''spiritual question,'' she angrily told him that it was not the time for spiritual questions. (note - 61) According to Dong, her tone made some of the members uncomfortable,
60Dong Deposition, p. 79 80.
61Dong testimony, p. 170. The voice was very strong, very strong, you know, from my perspective, I feel some energy coming out, and her tone, you know, could make people uncomfortable . . . there is one person stand up, after Master talked, stand up, asked a spiritual question regarding the practice. Master was very angry . . . It's a very strong voice. That could irritate people. (note - 62)
62Dong deposition, p. 112.
Immediately following the event, Dong went back to the Master's room at the Ritz-Carlton and helped count the funds that had been raised. Between sixty and one hundred of the blank money orders had been filled out by individuals who did not pay for them. (note - 63) The Master added a number of checks and money orders from another meeting, and, according to Dong, the total amount finally given to Trie could have been more than $400,000. (note - 64)
63Dong testimony, p. 158.
64 Id. at p. 161.
Dong had never met Trie prior to the New York meeting, and he testified that from the way Trie talked, he was under the impression that he worked directly for President Clinton. (note - 65) This was the only time Dong was aware of the Supreme Master ever asking for support for a political figure. (note - 66) Four days after this New York meeting--on March 20--Trie called Cardozo to set up their initial meeting. (note - 67)
65 Id. at p.163-164.
66Dong deposition, p. 114.
67 Id. at p. 24.
Dong testified that in May, 1996, Trie called him and asked him if they could meet at the airport while Trie was changing planes in New York. At this meeting Trie was very upset because the Trust was investigating the source of the contributions. He told Dong that the Trust was being ''very cautious'' because it was ''an election year.'' 68
68Dong testimony, p.163.
Several weeks after the event, Dong contacted the Ching Hai headquarters in Taiwan requesting that he and his fellow members be reimbursed for the $70,000 in money orders that they had purchased with their own money. Dong testified that up to this point he had received little or no reimbursement from the individual members. Dong and the other members who had advanced funds for the money orders were eventually reimbursed by the sect in three wire transfers, one for $20,000 from Taiwan, one for $30,000 from Cambodia where the sect had a chapter, and the balance in a wire transfer from Los Angeles chapter. (note - 69
69 Id. at p.165.
VI. May 9, 1996 White House Meeting
After receiving the initial investigative report from IGI, including information about the Ching Hai Buddhist group, Cardozo scheduled another meeting at the White House for May 9, 1996 to again discuss the Trie donations. (note - 70) The meeting was attended by Cardozo, Schwartz and Libow on behalf of the Trust, and Harold Ickes, Jack Quinn, White House Counsel, Bruce Lindsey, Deputy White House Counsel, Cheryl Mills, Deputy White House Counsel, Evelyn Lieberman, Deputy Chief of Staff, and Maggie Williams, Chief of staff to the First Lady, on behalf of the White House. Cardozo did not know why it was necessary to meet with so many senior members of the White House staff, especially in light of his insistence that the Trust operated independent of the White House. (note - 71) The White House apparently made the decision as to which staff members would attend.
70On April 24, 1996, Trie visited the Trust for the second time. He met with Cardozo and Schwartz and brought a shopping bag with him. Cardozo testified that when he saw Trie approach he thought to himself ''Oh my God, he's got a million dollars.'' In fact, Trie had an additional $179,000 for the Trust. Because the Trust was investigating the first batch of donations, Cardozo refused to accept the donations. Because IGI had been specifically instructed by Cardozo not to interview Trie, they had instead prepared a list of questions to be asked of Trie at the April 24 meeting in order to gain a better understanding of the source of the donations. However, neither Cardozo nor Schwartz asked any of IGI's questions at the meeting. Deposition of Michael Cardozo, May 7, 1997, pp. 129 130.
71 Id. at p. 115.
During the May 9 meeting, Cardozo explained the key facts surrounding Trie's donations to the Trust, and called upon Libow, the Trust's attorney, to provide the group with a summary of IGI's findings regarding Ching Hai and its leader, Suma Ching Hai. Libow described IGI's findings in great detail including their conclusion that at least some of the donations may have been coerced. (note - 72)
72 Id. at pp. 155-156. IGI's conclusion was ultimately proven correct when in July Cardozo received a letter from Ching Hai member David Lawrence. Cardozo circulated the letter to all of the people who had attended the May 9 meeting, as well as Mrs. Clinton. The Lawrence letter confirmed that in fact many of the donors did not contribute their own funds: Unfortunately as you suspected, the funds were raised by the
efforts of a concerned party who was unaware of some of the terms
mentioned in your letter. In particular, none of those in the private
association involved in the fund raising knew that the individual U.S.
citizen donors were required to use only their own funds. In my case,
$500 given by money order was advanced by the association or its leader
and not reimbursed by me. We were led to believe that reimbursement was
optional. I am sure that none of the members or leadership of the
association knew otherwise. In addition, I was not made aware of the
other terms mentioned in your letter. I was not aware that the Trust
''will make periodic public reports of fund contributors.'' Letter from David Lawrence to the Trust, July 5, 1996, p. 2 (Ex. 11).
The group discussed the pros and cons of returning the donations and the type of press coverage such a story would generate. (note - 73) Mills raised the question of whether returning the money would be seen as some sort of discriminatory act against Asian-Americans, but in the end the group supported the Trustees preliminary recommendation to return the money. (note - 74)
73Deposition of Michael Cardozo, May 7, 1997, p. 161 163.
74 Id. at p. 155.
Significantly, Cardozo testified that soon after the meeting started Bruce Lindsey entered the room, heard Trie's name mentioned, and commented that he knew Trie from Little Rock and that he knew Trie was ''involved with the Democratic Party.'' (note - 75) Ickes was present when the comment was made, but said nothing in response. (note - 76) Furthermore, despite the fact that Ickes was supervising the President's re-election effort from the White House, he apparently failed to make any inquiry into Trie's fundraising activities with the DNC.
75 Id. at p. 175.
76 Id. A. Ickes' Failure to Notify the DNC
Lindsey was correct on May 9th that Trie was ''involved'' with the Democratic Party. In fact, he was a Managing Trustee of the DNC (meaning he contributed or raised at least $100,000). Ickes' was also involved with the DNC. In fact, according to some witnesses, Ickes was calling the shots on a day to day basis at the DNC. (note - 77) Yet, despite his leading role with the DNC, Ickes failed to notify anyone at the DNC that a major DNC donor and fund raiser was involved in highly questionable fund raising for the Trust. According to DNC Chairman Don Fowler, ''If we had known about the problems with Trie earlier, we could have done something. I wish that I had known that.'' 78 Instead, the DNC was ultimately forced to return $645,000 in funds contributed or raised by Trie. (note - 79) Indeed, the first time Ickes mentioned the issue to anyone at the DNC was during a telephone conversation with B.J. Thornberry, Executive Director at the DNC, in October, 1996--after the fundraising controversy had broken in the press. Ms. Thornberry raised questions with Ickes regarding whether John Huang had been truthful with the DNC. (note - 80) Ickes responded by telling her that if she had those concerns she should also check out Charlie Trie and talk to Bruce Lindsey about him.
77Deposition of Donald Fowler, May 21, 1997 pp. 61-62. A complete discussion of Ickes' role in the DNC can be found in the section of this report on White House control of the DNC.
78''What Clinton Knew,'' Los Angeles Times, December 21, 1997, Sec. A, p. 1.
79Deposition of David Mercer, May 14, 1997, p. 240.
80Deposition of B.J. Thornberry, May 20, 1997, p. 114. Q: What did Mr. Ickes say to you? A: Mr. Ickes said two things to me. He said that if I had concerns about John Huang that I also might want to check out contributions from Charlie Trie, and he said also that I might want to have the same conversation with Bruce Lindsey. (note - 81)
81Id. at p. 114.
Mr. Ickes was not alone in his failure to follow up on Trie's actions with regard to the Trust. White House personnel, including the President, not only failed to notify the DNC of Trie's questionable fundraising practices with the Trust, but continued to have contact with him. Only four days after the May 9 White House meeting, the President sat next to Trie at the head table of a $5,000 per person dinner in Washington. (note - 82) In August, 1996, two months after the Trust decided to return the Trie-related donations, the President accepted $110,000 from Trie at an event celebrating the President's 50th birthday. (note - 83) In addition, as noted above, the President proceeded to appoint Trie to a federal trade commission and had the NSC prepare a personal response to foreign policy questions raised by Trie, both after Cardozo informed the White House and the First Lady about the questionable Trust donations.
82''What Clinton Knew,'' Los Angeles Times, December 21, 1997, Sec. A, p. 1. 83 Id.
VII. Trie's Final Meeting with the Trust
On May 17, 1996, Trie visited the Trust for the third and final time. Cardozo asked Schwartz to meet with Trie alone because Cardozo no longer wished to have any dealings with him. (note - 84) During the meeting, Trie acknowledged that he was indeed a member of the Ching Hai sect and that he had encouraged the Supreme Master to help him raise money for the Trust. (note - 85) Trie also had additional donations which he said totaled $150,000--bringing the total to $789,000--that he wished to deliver, but Schwartz refused to accept them because by the Trust had yet to make a determination regarding the first delivery of funds. (note - 86) 84Deposition of Michael Cardozo, May 7, 1997, p. 190-192. 85Deposition of Sally Schwartz, May 6, 1997, p. 211. 86Id. at p. 210.
VIII. The Trie-Related Contributions Are Returned
The decision to return the Trie-related contributions was finalized in June, 1996, and the Trust began mailing contributions back to the contributors. (note - 87) However, it did so with a twist. Notwithstanding IGI's findings about the involvement of the Ching Hai sect and the likely coercion exercised on sect members, the Trust sent a cover letter along with the returned contributions instructing the donors that they could re-submit their contributions if they met the Trust's guidelines. (note - 88) In other words, despite the fact that the Trust knew the donations had been, at least in part, coerced, it was still willing to accept the same money from the same donors.
87Return letter from the Trust to a contributor, June 26, 1996 (Ex. 12); The White House was informed of this decision as the option had been discussed at the May 9 White House meeting.
88 Id .; Deposition of Michael Cardozo, May 7, 1997, p. 212; Exhibit no. 12.
Loren Berger, the IGI investigator who authored the IGI report, testified before the Committee that she had a theory as to why the Trust sought to have the donations recontributed in this manner. She knew that any contributions accepted in the first six months of 1996 would be made public in the bi-annual report filed in July 1996, prior to the election. However, if the donations were returned and the donors then re-submitted their contributions during the second half of 1996, the ''recontributions'' would not be made public until the next reporting period--January 1997, after the election. Berger theorized that by returning the contributions and allowing them to be re-submitted after the first reporting period of 1996 had passed, the Trust could effectively receive the funds and avoid making them public until after the election. (note - 89) The only flaw in Ms. Berger's theory was that the bi-annual report had historically disclosed not just contributions, but returned contributions as well, which would mean the story would have become public prior to the election anyway. However, as discussed below, the Trust changed its public reporting method to avoid disclosing the return of the Trie-related contributions.
89Berger Deposition, pp. 84-85. Cardozo denied any such plan, although he was unable to offer any logical explanation for why the Trust would agree to accept tainted funds from the original donors, knowing that the donations had been coerced in the first place. IX. The Bi-Annual Report is Changed to Keep the Trie Donations Secret
Work on the mid-1996 bi-annual report began in the first week of July 1996. The purpose of the report was to record the activities of the Trust for the first half of 1996 and to make them public at a press conference held in August. All previous bi-annual reports submitted by the Trust since its inception had listed ''total contributions'' received by the Trust during the six month period and subtracted ''ineligible contributions'' that had been returned during that same period. (note - 90) However, in mid-1996 the Trust changed the format of the bi-annual report so that only ''contributions accepted'' by the Trust were listed. The Trust eliminated the return line and rationalized that any contributions received and returned within the six month period were never ''accepted'' and, thus, need not be disclosed. This was a marked departure from the way returns had been accounted for historically. (note - 91) 90Ex. 2. 91Ex. 1.
Cardozo and Schwartz both admitted that the reason for the deletion of the return line in the mid-1996 bi-annual report was to keep the Trie-related donations from becoming public. (note - 92) The net effect of this accounting change was to treat the Trie-related contributions as if they had never occurred. (note - 93)
92Testimony of Michael Cardozo, July 31, 1997, pp. 47-48; Deposition of Sally Schwartz, May 6, 1997, p.283.
93Even though Cardozo admitted the effect of the change was to hide the existence of the Trie-related donations, he testified that the real reason for the change was to clarify the Trust's accounting procedures. Schwartz, however, admitted the reason for the change was the Trie-related contributors. Deposition of Michael Cardozo, May 7, 1997 p. 246; Deposition of Sally Schwartz, May 6, 1997, p.283.
On August 14, 1996, the Trust held a press conference to release the bi-annual report. Cardozo was specifically asked by a reporter whether there were any contributions returned because they came from someone who was ''unsavory or anything like that.'' Cardozo said, ''No.'' (note - 94) Cardozo testified that he gave this answer to protect the privacy of the donors and the credibility of the Trust. (note - 95) In other words, if he had answered yes, the Trie-related matter would have become public at that time. 94Transcript of August 14, 1996 press briefing, p. 19 (Ex. 13). 95Deposition of Michael Cardozo, May 8, 1997, p. 10.
In addition to the accounting change in the bi-annual report, the Trust also revised the Quarterly Report that was routinely sent to the President and which contained the names of the donors to the Trust for the previous three months. On April 25, the President received a list which included the Trie-related donors. (note - 96Three months later that report was ''superseded'' by a subsequent report which omitted the names of those donors. (note - 97) The President, therefore, was not only aware of the original Trie-related donors, but was also aware that their donations had been returned. 96Original Quarterly Report sent April 25, 1996 (Ex. 14).
97Supplemental Quarterly Report omitting the names of the Trie-related donors sent June 26, 1996 (Ex. 15).
That the White House knew of the accounting change in the bi-annual report is also beyond dispute. First, a simple comparison between the mid-1996 bi-annual report and all previous bi-annual reports would have disclosed the change. Moreover, it is inconceivable that the matter was not discussed at one of the White House meetings concerning the Trie contributions. In fact, Harold Ickes' notes from both the April 4th and May 9th White House meetings suggest that the matter of how to report the returned contributions was discussed. (note - 98) Additionally, as addressed below, notes taken by Cardozo the day after the Trie contributions were finally made public suggest that White House counsel had approved of the manner of disclosure in the mid-1996 bi-annual report, and wanted to avoid any public disclosure of the Trie matter until at least after the election. 98Ex. 7. X. The Resubmitted Contributions are Returned/Trie's Growing Notoriety
During the period of August through October 1996, the Trust began receiving ''recontributions'' from the original Trie-related donors. Cardozo and Schwartz noticed that the occupations of many of the donors were inconsistent with the amounts they were giving. Students, hairstylists and others were making $1,000 donations which once again raised the question of whether they were contributing their own funds. 99 99Deposition of Michael Cardozo, May 7, 1997, p. 320-321.
On November 8, 1996, Cardozo conducted a conference call with the Trust's Co-Chairs regarding the re-submitted contributions. They discussed the questions raised by the donors' occupations, the letter from David Lawrence which confirmed that Ching Hai members had signed checks and money orders using someone else's money, and Trie's recent notoriety in the press in connection with John Huang and the growing DNC fundraising controversy. The group decided to re-engage IGI to investigate the resubmitted contributions to determine whether they too should be returned. However, there was no discussion of making Trie's relationship to the Trust public during the conference call. (note - 100) 100Deposition of Michael Cardozo, May 7, 1997, pp.320-321.
On November 14, 1996, Cardozo, Schwartz and Libow once again met at the White House with senior White House aides Jack Quinn, Cheryl Mills, Evelyn Lieberman and Bruce Lindsey. Cardozo informed them that IGI had once again been retained to examine the re-submitted contributions and that questions had been raised about the donors' occupations, as well as Trie's involvement with John Huang the DNC. Cardozo informed them that the Trust was inclined to return these contributions as well. (note - 101) 101Deposition of Michael Cardozo, May 8, 1997, pp.77-78.
While Cardozo testified that the impetus for returning the resubmitted contributions was the information about the donors' occupations, this does not square with the other evidence presented to the Committee. (note - 102) First, information regarding the occupations of the donors who were resubmitting contributions had surfaced as early as July. (note - 103) Second, IGI investigator Loren Berger testified that there was no new information about the donors that the Trust did not have when it decided to return the first round of contributions in June 1996. (note - 104) The real reason the Trust returned the ''recontributions'' appears instead to be the public notoriety Trie was receiving in the Fall of 1996 for his involvement in the DNC fundraising controversy and his relationship to John Huang and the Riady family. Yet, notwithstanding Trie's growing role in the fundraising matter, neither the White House nor the Trust, prior to the 1996 election, publicly disclosed the White House's substantial involvement with Trie or Trie's attempt to deliver over $700,000 in laundered contributions to the Trust. Indeed, from handwritten notes taken by Cardozo subsequent to the election, it appears likely that the White House Counsel's office made a concerted effort to prevent any public disclosure of the Trie matter until after the election. 102 Id. at p. 30. 103 Id. at p. 14. 104Berger Deposition, pp. 88-89.
XI. Cardozo's Handwritten Notes
As discussed more fully below, the Trust eventually was forced to disclose the Trie contributions at a press conference on December 16, 1996. On the following day, Cardozo received several telephone calls from the press and others which were reflected on call sheets provided to the Committee. (note - 105) It is apparent from the call sheets and Cardozo's testimony that the press was questioning him about why Trie's relationship with the Trust had not been disclosed in mid-1996 with the bi-annual report. Cardozo's handwritten notes appear on some of the call sheets. In most instances the notes are written in the narrative form and contain lines drawn to a specific reporter. They look and sound like notes of a question being posed to Cardozo during a phone conversation. However, in one margin Cardozo wrote, ''In June never came up. Investigation wasn't complete. WH Counsel: agreed w/ disclosure. Jack, Bruce, Cheryl--not disclose info until after election. Opposed disclosure.'' (note - 106)
105Cardozo's handwritten notes on his telephone log, December 17, 1996, p. 5 (Ex. 16). 106 Id. at p. 5.
During his testimony at deposition and before the Committee at public hearing, Cardozo speculated that the notes must have referred to some question posed by one of the reporters on that page. However, when pressed on the issue, he could not confirm this:
Q. Is it your testimony under oath, Mr. Cardozo, that this is a question posed to you by a reporter? A. I don't know precisely what it refers to. (note - 107) 107Testimony of Michael Cardozo, July 31, 1997, p. 109. * * * * *
Mr. Tipps: Mr. Cardozo, you and I talked about these notes in your deposition. Do you recall that? Mr. Cardozo: Yes, I do.
Mr. Tipps: And you said here today that this was a reporter. Can you tell us which reporter on that exhibit asked you this? Mr. Cardozo. No, I cannot be certain which reporter it was. (note - 108) 108 Id. at p. 108. While Cardozo's speculation might be accurate, it appears from the evidence, taken as a whole, that a much more likely interpretation is that Cardozo was simply talking with someone from the White House and lamenting all the questions he was being bombarded with from the press concerning the timing of the disclosure about Trie. The White House aide, in turn, was simply stating what he or she knew about that issue and Cardozo wrote it down. The notes are not written as though it is a question being posed to him from a reporter. Moreover, the notes are not connected with any particular reporter but are, instead, bracketed or walled off in a manner that suggests their separateness from the list of reporters. Additionally the notes themselves do in fact explain what was going on at the White House in the pre-election time frame. The phrase ''In June never came up'' likely refers to the fact that in June 1996 Trie had not become a public figure connected to the DNC fundraising controversy. The phrase ''W.H. counsel: agreed on disclosure'' likely refers to the fact that the White House counsel's office (many of whom were at the May 9 White House meeting) agreed with the method of disclosure used in the mid-1996 bi-annual report which omitted any reference to returned contributions. Finally, the phrase ''Jack, Bruce, Cheryl--not disclose info until after election'' speaks for itself. Cardozo admitted that this note referred to Jack Quinn, Bruce Lindsey and Cheryl Mills--all White House Counsel and all attendees at the May 9 White House meeting. Indeed, at the bottom of the this page of notes, also in Cardozo's handwriting, are the names Mike McCurry and Lanny Davis, both senior White House aides who would have been privy to this information. Cardozo admitted during public hearing that he spoke to both of them. 109
109 Id. at p. 110. Furthermore, this interpretation of Cardozo's notes is consistent with subsequent press reports indicating that the Trie-related contributions were kept away from key White House personnel for fear that they might make the story public. The Los Angeles Times has reported that Trie's relationship with the Trust was intentionally kept from Jane Sherburne, former Special Counsel to the President, and Mark Fabiani, former White House counsel in charge of press inquiries about Whitewater, until at least after the election because they were known to be advocates of disclosing negative stories rather than trying to hide them. Jane Sherburne was interviewed by the Committee and confirmed that she was not notified about the Trie-related contributions until after Trie's name surfaced in the press. Memorandum of interview of Jane Sherburne, September 19, 1997, p. 13.
XII. Trie's Relationship with the Trust is Made Public
The Trust and the White House kept the Trie story private until after the election, but their hopes of keeping it out of the public completely ended with a phone call in December from a reporter working on a story for NBC News. Once Cardozo realized the story was going to become public, he worked closely with the White House to make sure that it was released on their terms and with their spin. A. Cardozo's Call From John Mattes On December 2, while on a business trip to Los Angeles, Cardozo was informed by his office that he had received a telephone call from John Mattes. When Cardozo called him back, Mattes informed him that he was working on a story for NBC News regarding a large number of contributions from Asian-Americans to the Trust which had been returned. He also told Cardozo that the producer he was working with was a Mr. Oetgen. He was aware of the donors' association with Ching Hai, but gave no indication that he was aware of Charlie Trie's involvement. (note - 110) 110Deposition of Michael Cardozo, May 8, 1997, p.52.
Cardozo told Mattes that he was in conference and would have to contact him later. Cardozo immediately called Cheryl Mills, Deputy White House counsel, and set up a meeting the next day at the White House to discuss the matter. (note - 111) 111 Id. at p. 49. B. The December White House Meetings
On December 4, and December 11, Cardozo, Schwartz and Libow once again met at the White House with senior White House aides Quinn, Lindsey, Mills, Lieberman and Williams. The group discussed the telephone call from Mattes and logistically how the Trust should go about making the story public. In the December 4 meeting, Cardozo told the the White House employees about his call from Mattes and expressed his concern that if the story was to go public he wanted to make sure that the Trust was able to tell the story from its perspective. Mills advised Cardozo to call Oetgen to see if Mattes was ''for real'' before making any arrangements to make the story public. This was the first meeting at which making the story public was discussed or even contemplated. (note - 112) 112 Id. at p. 57.
Following the December 4 meeting, Cardozo called Oetgen and found out that Mattes was indeed working on a story for NBC. Both Cardozo and Oetgen were planning to be out of town in the near future, so they agreed that Oetgen would call back the next week to follow-up on the story. Oetgen, however, failed to call the next week. (note - 113) Nonetheless, as a result of the call from NBC, Cardozo, with help from the White House, proceeded with plans to make the Trie story public. (note - 114113 Id. at p. 56. 114 Id. at p. 57.
Having determined that Mattes was ''for real,'' another meeting was held at the White House on December 11 to decide how to disclose the story publicly. The White House aides determined that the best method was a press conference and they suggested that Cardozo contact Mark Fabiani, a former White House counsel who had handled press inquiries regarding Whitewater, for help in making logistical decisions. (note - 115) 115 Id. at p. 67.
Following the meeting, Cardozo called Fabiani on two occasions and took notes of the conversations. Included in the notes is a reference to NBC which reveals that the call from Mattes was indeed the impetus behind the decision to go public--''NBC changes everything, could come back with a lot more info.'' (note - 116) Another portion of Cardozo's notes states, ''Trie is a big-time player, Daschle, Congress.'' (note - 117)
116Cardozo's handwritten notes of conversation with Fabiani, December 12, 1996, p. 1 (Ex. 17).
117Cardozo's handwritten notes of conversation with Fabiani, December 11, 1996, p. 2 (Ex. 18).
When asked what this meant, Cardozo said that Fabiani was aware that Trie was well known on Capitol Hill and had raised money for several Democratic members of Congress. (note - 118) Cardozo and Fabiani also discussed whether NBC should be contacted prior to the press conference since they were preparing a story, however NBC was not contacted. (note - 119) 118Deposition of Michael Cardozo, May 8, 1997, p. 100. 119 Id. at p. 88; Ex. 17. C. The December 16, 1996 Press Conference
Cardozo scheduled the press conference for December 16, 1996, less than two weeks after first speaking with Mattes. (note - 120) With regard to the NBC story, the following exchange of questions and answers took place: 120 Id. at pp. 66, 69 70. A Participant. Are you aware, sir, of a story being prepared at this moment, prior to this calling of this conference today? Mr. Cardozo. No. A Participant. In other words, are you trying to head off a story that was thought to be---- Mr. Cardozo. No. (note - 121) 121Transcript of December 16, 1996 press conference (Ex. 19) p. 38. Cardozo did not explain to the press that the impetus for the press conference was the call from Mattes or that there had been no discussion and no intention whatsoever of making the donations public prior to that call. Cardozo later testified before the Committee that at the time this question was posed he did not think NBC was working on the story since Oetgen had not called him back.
Although Cardozo was aware from press accounts that Trie's fundraising activities were being investigated by the Justice Department, he made no attempt to notify them of Trie's activities concerning the Trust until two days prior to the press conference. (note - 122) 122Deposition of Michael Cardozo, May 8, 1997, p. 164.
As a result of its investigation into Trie's activities with the Trust, the Committee gained further insight into Trie's close relationship with the White House, and how, as a major fundraiser, Trie raised and laundered contributions for the benefit of the President and First Lady. The evidence uncovered by the Trust's own investigators reveals that the donations were laundered through members of a controversial Buddhist sect, many of whom were coerced into making the donations. The evidence also reveals that senior members of the White House staff were informed of this disturbing fact, yet still acquiesced in a plan to have the donations returned to the contributors, and then resubmitted to the Trust. This plan soon became untenable because of Trie's sudden notoriety over his relationship with John Huang and the growing DNC fundraising controversy. Rather than publicly disclosing Trie's involvement with the Trust, however, the White House sought to keep the matter secret until after the presidential election. Moreover, despite all of the warning signs they were given, these same White House aides, particularly Harold Ickes and Bruce Lindsey, made no effort whatsoever to alert the DNC that a major DNC fundraiser was involved in money laundering with the Trust.
The investigation also demonstrated that Trie was granted several special favors by the White House at or about the same time that he was raising and delivering the questionable funds to the Trust. One question which remains unanswered is whether these favors--the appointment of Trie to the trade commission, Wang Jun's invitation to meet personally with the President, or the personal reply letter from the President prepared by the NSC explaining U.S. foreign policy--were linked in any way to the Trust donations. These same types of questions were raised by the Trustees in their initial meetings concerning Trie. Inexplicably, neither the Trust nor the White House ever made any attempt to investigate these matters. Because Trie had fled to China during the course of the Committee's investigation and did not return until early February 1998, and Mark Middleton has asserted his Fifth Amendment privilege against self-incrimination, the Committee could not conclusively answer these questions.
THE SAGA OF ROGER TAMRAZ
The testimony of Roger Tamraz provided the Committee with the chance to hear from an unrepentant access-purchaser. The hearing at which he appeared revealed efforts by officials of the DNC to reverse National Security Council (NSC) policy regarding Tamraz's access to the President and pressure NSC officials to change their position on the merits of Tamraz's Caspian Sea pipeline scheme.
The Tamraz affair also stands out as one which produced a genuine hero--or, to be more precise, a genuine heroine. For despite the ugly window it provides upon high-level venality, the Tamraz story is also the story of Sheila Heslin, a courageous NSC staff member who resisted inappropriate and possibly unlawful attempts by senior officials to change U.S. Government policy in pursuit of Tamraz's money. This episode also provides a reminder that despite all such wrongdoing, there are decent people in government with noble ideals of public service.
Roger Tamraz, an international financier and entrepreneur in the oil business, is presently wanted by police in at least two countries. A naturalized American citizen, he has been ordered by a French court to pay the equivalent of some $ 57 million in connection with the collapse of a French bank and faces an Interpol arrest warrant for allegedly embezzling between $154 and $200 million from the failed Al Mashreq Bank in Lebanon, of which he had been the chairman. In June 1995, Tamraz--who had left Lebanon in 1989 with the assistance of Syrian authorities--was also sentenced in absentia to 15 years in prison by a military court in Lebanon. (note - 1) Tamraz has also been closely involved in business dealings with Libya's state-controlled National Oil Company, to which he sold or with which he merged his own Tamoil company. (note - 2)
1Transcribed Interview of Roger Tamraz, May 13, 1997, pp. 4 & 8 10.
2Alejandra Y. Castillo, memorandum to Donald Fowler, July 12, 1995, p. 2 (Ex. 1).
Tamraz acknowledges his various continuing legal problems, admitting that ''if anyone puts my name in NEXIS-LEXIS, you get a lot of horror stories.'' (note - 3) Nevertheless, he maintains that he is entirely innocent of wrongdoing, having been unfairly persecuted by his enemies because of his efforts on behalf of ''the U.S. and peace'' and because he was ''portrayed as a Jew, a dirty word in the context in which it was used.'' (note - 4)
3Tamraz interview, p. 6.
4Testimony of Roger E. Tamraz, September 18, 1997, pp. 4 6. According to researchers at the DNC, Tamraz's claimed ''kidnapping'' and ''torture'' in Lebanon-- see, e.g., Id. at p. 4--may have arisen out of the failure of the Al-Mashreq Bank when a commander of a Christian militia group in Lebanon held Tamraz hostage pending repayment of some $3 million allegedly lost by that commander when the bank collapsed because Tamraz used its funds to bankroll his private business projects. Tamraz had apparently denied paying the $3 million ransom reportedly demanded of him. See Ex. 1, p. 2.
Among Tamraz's business interests is a company called Oil Capital Limited, which seeks to develop oil pipeline concessions in the Caucasus. After the collapse of the Soviet Union, extraordinary possibilities for oil production had opened up for the huge reserves of the Caspian Sea region. While governments such as that of the United States worked to speed this oil to Western markets, to lessen the dependence of the oil-rich countries of the region upon Russia, and to break Russia's monopoly upon pipeline transit routes out of the Caspian, 5 international financiers and oil companies--Oil Capital Limited among them--scrambled to take advantage of the commercial opportunities presented by a variety of proposed new pipeline projects.
5Testimony of Sheila Heslin, Sept. 17, 1997, p. 4.
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