WASHINGTON - More than $100,000 collected at a California fund-raising event a week before the 1992 election wound up in the hands of two recently convicted fund-raisers, instead of Democratic Party coffers, bank records show.
The Oct. 27, 1992 event held by Nora and Gene Lum in Manhattan Beach, Calif., had the blessing of Democratic National Committee chairman Ron Brown and was attended by the party treasurer, Rep. Bob Matsui of California. Invitations went out on Clinton-Gore campaign and DNC letterheads.
Contributors wrote their checks to the DNC and the money was originally deposited into a checking account bearing the committee's name. But the checks were never reported to the Federal Election Commission. Instead, bank records indicate that $159,000 was transferred to two companies owned by the Lums.
The bank records were discovered this fall by investigators for the House Government Reform and Oversight Committee, which is examining political fund-raising abuses, and turned over to the Justice Department. The department did not learn of the transactions until after it had sealed a plea bargain with the Lums for an illegal $50,000 fund-raising scheme to help Democratic candidates in 1994.
"Once again our House investigation has uncovered information that suggests the Justice Department is not vigorously pursuing pertinent witnesses and facts," said Rep. Dan Burton, R-Ind., the committee chairman.
The discovery raises questions about why the DNC and Clinton-Gore campaign failed to account for the contributions, as required by law, and whether party or campaign officials were aware of the diversion.
DNC spokesman Steve Langdon said current party officials have "no authoritative information" about the Manhattan Beach event, or the checking account from which the money was transferred to the Lums' companies.
"If presented with authoritative information about these alleged contributions, we will review it and take appropriate action if necessary," he said.
Matsui confirmed he attended the fund-raiser. "I was asked to show up. I showed up and I assumed from what I was told that it was a DNC fund-raiser that was supposed to raise $50,000," he said, adding he assumed the staff would handle any donations.
Melinda Yee, the Clinton campaign's outreach director for Asian-Americans, said through her lawyer that the event was "authorized by senior campaign officials." Attorney Nancy Luque declined to identify the campaign officials, but said that Brown, who was killed in a 1995 plane crash, "was certainly aware of the event."
Yee "assumed someone in the DNC's finance division" would handle the money and was not aware of how the donations were ultimately spent, Luque said.
The fund-raiser was held by an outreach group that the Lums and DNC started called the Democratic National Committee Asian Pacific American Advisory Council. The invitations bore a Bill Clinton signature, and promised donors their money would benefit the DNC's Asian outreach effort.
White House special counsel Lanny Davis said the signature on the invitations was not Clinton's own or machine-generated, and that aides have been unable to determine who authorized it.
The bank records were discovered this fall by Burton's committee, which is investigating whether the Democratic fund-raising abuses that surfaced in 1996 may have begun during Clinton's first White House bid in 1992.
That committee has received a written offer from the Lums to testify in exchange for immunity. So far, lawmakers have held off a decision.
Senior Justice officials, speaking on condition of anonymity, said investigators had been looking into the 1992 fund-raiser before reaching the plea agreement with the Lums, but did not locate the account until after the Lums began cooperating.
That agreement provides the couple immunity from prosecution for any campaign fund-raising abuses prior to 1997 and any criminal acts the Justice Department knew about prior to the agreement except for tax violations.
Rep. Burton said that "even though the attorney general testified last week before our committee that she was leaving no stone unturned, the facts appear otherwise." Burton said that in an earlier instance, his investigators were the first to find a group of straw donors to the Democratic National Committee including the sister of fund-raiser Charlie Trie.
The records from Sanwa Bank show more than $160,000 flowed into accounts that bore the name "Democratic National Committee Asian Pacific Advisory Committee" in late 1992 and 1993. The lion's share - more than $100,000 - came in the days just before or after Oct. 27 event.
Among the donors and honorees at the event was Lippo Bank businessman John Huang, who four years later would emerge as a central player in the Democratic fund-raising controversy. He gave $2,500.
In the weeks that followed, the records show, several checks totaling almost $160,000 were written from the account back to various Lums' companies. The checks were signed by Mrs. Lum.
Cono Namarato and Scott Michael, the two attorneys who represented the Lums, did not return a half-dozen phone calls to their Washington office seeking comment.
But in the Lums' agreement with the House panel, the couple said they set up the Asian outreach group at Brown's request and that it operated as an entity of the DNC. As for the fund-raiser, they said DNC staff "worked on its planning and execution."
Most of the checks from the account do not indicate why the money was transferred. One check for $14,000 to CPI, written two weeks after the fund-raiser, is marked "reimbursement." Two other checks bear the word "inaugural," suggesting the money may have been headed for some use for Clinton's first inauguration.
The first check to the Lums' company was written out the same day as the fund-raiser, while the last withdrawal closing out the account occurred in early 1993.
By The Associated Press
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