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Documents From Rep. Kim's Firm Subpoenaed : Inquiry: U.S. grand jury is investigating whether corporate funds or services were used in his campaign, a violation of federal law.

July 21, 1993|CLAIRE SPIEGEL and ROBERT W. STEWART | TIMES STAFF WRITERS

A federal grand jury in Los Angeles has subpoenaed financial documents and campaign records of an engineering corporation owned until recently by Rep. Jay C. Kim (R-Diamond Bar), who allegedly used corporate funds last year to help pay some of his campaign expenses.

Washington accountant Keith Davis, hired recently by Kim, said the congressman telephoned Tuesday morning to tell him that a federal subpoena had been served on the corporate offices of JayKim Engineers Inc. in Diamond Bar.

"I heard about it from Kim," Davis said. "He just wanted to let me know."

But Kim later told The Times that he had no knowledge of any federal grand jury action. "I don't know anything about a subpoena," he said.

Assistant U.S. Atty. Steven Mansfield, who works in the corruption and government fraud section of the U.S. attorney's office, confirmed that a subpoena was issued by a Los Angeles grand jury at his request. He declined to comment on the investigation or say how much time the company was given to gather and surrender the records to the grand jury.

The subpoena asked for financial documents, campaign records and other data of the company going back several years.

Last week, Kim hired Davis' firm of Huckaby & Associates, which is prominent in Republican Party politics, to review the books of JayKim Engineers and determine if any corporate funds were improperly used to pay some of the congressman's 1992 campaign expenses.

Federal law prohibits corporations from contributing money or services to federal campaigns.

The Times reported last week that Kim withdrew hundreds of thousands of dollars from the corporation for campaign expenses and his own personal benefit while the company was slipping toward insolvency, unable to pay some of its bills and taxes.

The company, which Kim has said he recently sold to real estate entrepreneur Sung Woo Min, was placed in receivership last month by an Orange County judge after it defaulted on a $1-million loan from Sunwest Bank.

Min and his attorney did not return phone calls Tuesday.

Davis said that he is reviewing records that were mailed to him from JayKim Engineers and that he is hopeful the federal subpoena will not interfere with his progress. At Kim's direction, "a good number of records" have been provided to him, he said. More are in the mail, he said, adding that he hopes to get copies of others before they are surrendered to the grand jury.

Kim was interviewed during a fund-raiser he gave Tuesday night at the Capitol Hill Club in Washington, which was attended by about 150 supporters.

The freshman congressman, who represents parts of Los Angeles, Orange and San Bernardino counties, said he wants to be left alone until the accountant and lawyer he has hired complete a final independent report on his campaign activities. He said he expects the report to be completed by early next week.

Kim has said his campaign intended to promptly pay back any election-related expenses borne by the corporation. He has blamed the company's former chief financial officer for failing to bill the campaign promptly.

The Federal Election Commission has received two requests to investigate the allegations against Kim--one from a former primary opponent, the other from the Democratic Congressional Campaign Committee.

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