08/21/97 - 12:18 AM ET - Click reload often for latest version

House panel to review O'Leary donation

WASHINGTON - Energy Department and congressional investigators want to know whether former Energy secretary Hazel O'Leary met with a Chinese petrochemical official in exchange for a donation to her favorite charity.

O'Leary denied Wednesday that the contribution and the meeting were related.

"At no time did I authorize anyone at the Department of Energy to request or accept a check in exchange for a meeting," said O'Leary, who ran the department during President Clinton's first term.

Her successor, Federico Pena, ordered an internal probe after California businessman Johnny Chung told NBC News that the October 1995 meeting took place on the same day he wrote a $25,000 check to Africare, which promotes economic development and health care in rural Africa.

Chung is a key figure in the campaign finance scandal being investigated by two congressional committees.

Sen. Arlen Specter, R-Pa., a member of the Senate panel, said Chung's allegation is another indication that an independent counsel might be needed to probe fund-raising abuses.

And Richard Bennett, newly appointed chief counsel of the House Government Reform and Oversight Committee, said of Chung's comments: "I'd like to explore that."

Chung told NBC's Tom Brokaw that when he was trying to arrange the meeting between some Chinese friends and O'Leary, an Energy Department official and a lobbyist told him: "It will be nice if you make your donation to Africare."

Africare's most recent list of benefactors includes blue-chip companies, foreign governments, foundations and a handful of individuals, including Chung. O'Leary is on Africare's board of directors.

In an Oct. 17, 1995, letter released by the Energy Department, former Democratic National Committee (DNC) chairman Donald Fowler asked O'Leary to meet with Hauren Sheng, the executive responsible for China's refining industry. Fowler said he was making the request on behalf of Chung, a DNC supporter.

Two days later, O'Leary met Sheng and posed for pictures with about a dozen Chinese businessmen.

It's unclear why Sheng wanted to meet with O'Leary.

The Energy Department official who arranged the meeting between Sheng and O'Leary denied seeking a donation from Chung, department spokeswoman Carmen MacDougall said.

O'Leary said she routinely discussed energy issues with Chinese officials and first met Sheng on a trip to China.

Chung also is under investigation for giving a $50,000 check for the DNC to Maggie Williams, chief of staff to Hillary Rodham Clinton, in the White House.

He has refused to testify before the congressional committees unless granted immunity.

By Judi Hasson, USA TODAY