Donors asked to make laundered contributions

WASHINGTON - Three donors to President Clinton's re-election campaign have told House investigators that an employee of Democratic fund-raiser Johnny Chung asked them to make the contributions and later reimbursed them, according to a House source.

Investigators were told that Chung's part-time bookkeeper, Nancy Na-Chi Lee, asked four people - one has since died - to make out $1,000 checks to the Clinton-Gore '96 campaign, said the source, who spoke on condition of anonymity. Ms. Lee was said to have immediately reimbursed the donors in cash, said the source.

Such arrangements would be illegal under federal election law, which bars contributors from giving money in the name of another to hide the true source of the money.

It was the first allegation of laundered contributions directly to the Clinton-Gore '96 campaign. The Democratic National Committee has returned nearly $3 million because the money came from questionable sources, including some donations made in the name of others.

The House Government Reform and Oversight Committee has issued a subpoena for records of the re-election campaign, said Robert Neuman, a spokesman for the campaign's Legal Compliance Committee.

The committee does not have any plans to refund the donations - unless they are deemed illegal by a court or the Federal Election Commission, he said. The donations were first reported by The Washington Post.

Chung, who was described in a 1995 White House memo as a hustler who should be regarded with caution, is a central figure in the investigation of campaign fund raising. He tried to deliver more than $700,000 in donations to Clinton's legal defense fund and also handed a $50,000 check made out to the Democratic Party to Maggie Williams, then chief of staff to Hillary Rodham Clinton.

Chung has been subpoenaed to testify Friday at hearings convened by the House panel. He is expected to invoke his Fifth Amendment privilege against self-incrimination and refuse to testify.

Chung contended last summer in a newspaper interview that the $50,000 donation he gave to the Democratic National Committee was solicited by Evan Ryan, a White House aide to Ms. Williams.

The White House has denied that Ryan or any other presidential aides solicited donations from Chung. Williams accepted the check but passed it on to the DNC.

A day after he delivered the check to Williams, Chung escorted a group of Chinese businessmen to the Oval Office to watch Clinton tape his weekly radio address.

"I see the White House is like a subway - you put in the coins to open the gates," Chung told the Los Angeles Times in July.

The donation and the circumstances of Chung's visit to the White House are expected to be examined at hearings Thursday. Ms. Williams is scheduled to be questioned about the episode.

The panel is also expected to examine the circumstances in which Chung pressed the White House to give him pictures of the six Chinese businessmen posing with Clinton in the Oval Office.

Robert Suettinger, a National Security Council aide, approved giving Chung the photos, although he warned that "my impression is that he's a hustler."

"My concern is that he will continue to make efforts to bring his 'friends' into contact with" the Clintons "to show one and all that he is a big shot."

The three donors and Chung's bookkeeper have not been scheduled to testify.

By The Associated Press



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