07/23/97 - 12:39 AM ET - Click reload often for latest version

Thompson blasts Justice Department investigation

WASHINGTON - With hearings on political fund-raising abuses shifting to the Republicans, the Senate's chief GOP prober said Tuesday he had lost confidence in the Justice Department's investigation of the 1996 campaign.

Sen. Fred Thompson, R-Tenn., voiced anger that senior Justice Department officials refused to specify why they opposed granting partial immunity to allow four Buddhist nuns to testify about a fund-raiser attended by Vice President Al Gore.

Thompson, chairman of the Senate Governmental Affairs Committee, charged that the Justice Department's handling of congressional immunity is fraught with conflicts of interest because the testimony deals with alleged Democratic wrongdoing. Thompson also complained that the department was slow in reviewing the panel's immunity requests.

As a result, he told reporters, "I do not have confidence any more in the Justice Department's ability to carry out a credible investigation."

Justice Department spokesman Bert Brandenburg said prosecutors had approved immunity for 11 of the 26 people for which the committee had requested. Of the remaining 15, Brandenburg said, the department either opposed immunity or said it lacked enough information to make a decision.

"Some of the 15 may later be approved for immunity as we get more information," he added.

Brandenburg said the only criterion that Justice prosecutors are using is whether immunity could harm a potential criminal prosecution.

Limited or "use" immunity would prohibit prosecutors from using anything a witness tells the Senate as evidence in a criminal trial.

Thompson declined to say that the Justice Department was trying to spare Gore embarrassment by seeking to block testimony from nuns about the April 29, 1996, fund-raiser at the Los Angeles-area Buddhist temple.

Some of the nuns are prepared to testify that Democratic fund-raiser John Huang suggested the scheme under which 10 or 12 monastics made contributions totaling some $60,000 and were later reimbursed by the temple, said a committee source. Bank records show the temple's funds came from Taiwan, said the source, speaking on condition of anonymity.

Thompson and Sen. Arlen Specter, R-Pa., also said they were exploring the possibility of filing a lawsuit to force Attorney General Janet Reno to seek appointment of an independent counsel to investigate campaign fund-raising abuses.

Thompson's comments came as his committee prepared to hear three days of testimony presented by Democrats about the flow of foreign money into a Republican Party think tank.

Senate Democrats will present evidence about a $2.1 million loan guarantee by a Hong Kong company to the National Policy Forum, $1.6 million of which they contend was largely funneled into GOP campaign efforts in 28 states during the 1994 congressional elections.

Former GOP Chairman Haley Barbour is scheduled to testify Thursday about his role in arranging the loan guarantee with Young Brothers, a Hong Kong real estate developer with a U.S. subsidiary. Democrats contend the U.S. operation was a shell company without assets.

Senate Democratic investigators will present documents and testimony to contradict Barbour's sworn statements that he did not know until recently that the Young Brothers' money may have come from Hong Kong, said committee sources, speaking on condition of anonymity. A GOP fund-raiser, Fred Volcansek, told the panel he was in direct contact with Barbour from Hong Kong, one source said.

The GOP returned $120,000 donated by the Hong Kong company, saying it did not know the money came from a foreign source until news reports described its origin.

Barbour has denied improperly raising foreign money, saying the policy forum could accept such funds because they were not used to finance election efforts.

Michael Baroody, the forum's former executive director, is expected to testify about a memo he wrote to Barbour that the distinction between the think tank and the GOP was a fiction, said a source.

The NPF defaulted on part of the loan, costing the Young Brothers $740,000.

Thompson, meanwhile, complained about the Justice Department's unwillingness to provide more information about its criminal investigation to enable the Senate to make informed decisions about granting limited immunity.

"They have rung down the curtain on us," Thompson said.

In another development, an attorney for Huang's wife has told the committee she did not solicit Democratic Party donations despite party records indicating she raised $52,000 while Huang worked at the Commerce Department.

The disclosure came in a letter Tuesday from the Senate panel's chief counsel, Michael J. Madigan, to Ty Cobb, Huang's lawyer who until recently also represented Jane Huang. "You have represented to me ... that Mrs. Huang would testify that she did not solicit any contributions during that time period," Madigan wrote.

Mrs. Huang has told the panel she is joining her husband in invoking her Fifth Amendment right against self-incrimination to refuse to be questioned by the committee.

"Mrs. Huang did not solicit any contributions," Richard Marmaro, Mrs. Huang's new attorney said in a phone interview. Marmaro said his client does not have "any information whatsoever" on why the party listed her as a solicitor.

Republicans are trying to determine whether Huang raised the donations while a government official - a potential legal violation - and used his wife to disguise his activities.

.By The Associated Press