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Former Democratic Donor Defends His Contributions

Politics: Speaking before House panel, Chung calls efforts to parlay political access 'the American way.'

May 12, 1999|ALAN C. MILLER and WILLIAM C. REMPEL | TIMES STAFF WRITERS

Chung traced his initiation into the world of political money to Clinton's 48th birthday party in August 1994, when he made his first donation. Chung said he soon saw that "attending these events and getting pictures with people like the president and vice president" helped business.

Word spread in China of Chung's access and, he said, his fax business evolved into helping Chinese associates obtain visas, escorting them around the U.S. and introducing them to business and government contacts.

After meeting Liu in Hong Kong in June 1996, Chung entered into a business relationship with her. In addition to her role in the state-owned aerospace company, Liu is the daughter of China's retired senior military officer.

Two months later, Chung recalled, Liu introduced him to Ji, who was using an alias, at a Hong Kong restaurant. At this session, Chung testified, Ji told him:

"We really like your president. We hope he will be reelected . . . I will give you $300,000 U.S. dollars. You can give it to . . . your president and Democrat Party."

Following a second meeting, Chung said he expressed concern to Liu about taking Ji's money.

Chung said Liu told him this was acceptable because others were already "involved in developing relationships and access to China."

Chung said he eventually gave $35,000 of the $300,000 from Ji to the DNC in August and September of 1996. Senate Intelligence Committee investigators said last week the FBI traced $20,000 to the DNC and "most of the remaining funds went for [Chung's] personal use, including mortgage payments."

One curious aspect of Chung's testimony revolved around a five-month undercover investigation by the FBI in which a Chinese American businessman portrayed himself as a messenger for the Beijing government.

In his testimony, Chung identified the suspected messenger as Robert Luu, a San Gabriel Valley businessman. Luu, a convicted software pirate, had been out of San Quentin State Prison only a short time before contacting Chung. FBI transcripts of secretly recorded meetings between Luu and Chung, obtained by The Times, show that the Vietnam-born Luu claimed to be sent by Liu, the Chinese official.

For several weeks, leading up to a presidential visit to China late last June, Luu urged Chung to keep silent and resist cooperating with the Justice Department. He said Chung had friends in China who would take care of him. And Chung said he regarded Luu's questions about his family as veiled threats. Luu, who denies any wrongdoing, has since repudiated his tape-recorded claims of working for Liu. He said his only goal was to get close to Chung. Waving a booklet filled with pictures of Chung at the White House, Luu said in an interview that he regarded Chung as "a most important man--look at these pictures with Clinton, with Chinese ministers, with very high people!"

*

Video of Johnny Chung's testimony before the House committee is available on The Times' Web site:

http://www.latimes.com/chung

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