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The Lippo Group

Mochtar Riady and his son, James, control the Lippo Group, a $6 billion conglomerate based in Indonesiaan, the ethnic Chinese family at the heart of many Clinton campaign fund-raising scandals. They have been friends and supporters of President Clinton since at least the early 1980s, when the Lippo Group acquired a minority interest in the Arkansas-based Worthen Bank, and James had moved to Little Rock to learn the banking business.

The Riadys also had a "long-term relationship with a Chinese intelligence agency;" according to a report by the Thompson committee. The report, which reveals only unclassified information, does not claim that Clinton knew of the relationship between the Riadys and the Peoples Republic of China, nor is that relationship explained.

This much is known: On November 7, 1992, two days after Bill Clinton was elected president, China Resources Holding Company, a Beijing government-owned corporation known by U.S. intelligence to provide cover for Chinese intelligence-gathering operations, purchased 15 percent of the Hong Kong Chinese Bank (HKCB), a subsidiary of the Riady family-controlled Lippo Group. The Riadys sold the 15 percent interest to China Resources for $2.10 a share at a time when the public stock was trading at $2.62 per share - a 20 percent discount. As the South China Morning Post noted, "It was essentially a private placement... structured in such a way as to circumvent having to secure the approval of the Hong Kong stock exchange."

On June 17, 1993, Lippo announced that it had sold an additional 35 percent of HKCB to China Resources, giving the Beijing government-owned espionage front half ownership. This time, instead of getting a discount, Beijing paid a 50.7 percent premium on HKCB stock. According to the Morning Post, the "deal will also bring a profit of about $164.8 million to HKCB holding" - that is, to the Riady family.

According to a summary prepared in December 1996 for House investigators examining the Lippo-China connection, "under Hong Kong law, China Resources [Holding] Company's 50 percent share in the bank provided it with access to all [Lippo] corporate information."

Thus, as of July 1993, every time Riady or Huang met with Clinton, the president was dealing with the partners of a Chinese government-owned organization known by U.S. intelligence agencies to provide cover for Chinese intelligence-gathering operations.

During the 1992 presidential campaign - about the same time the Red Chinese were acquiring an interest in the Riadys' Lippo Group-James Riady and his wife contributed $200,000 in "soft money" to the Democratic Narional Committee. In January 1993 Lippo executives James Riady and John Huang gave a joint $100,000 contribution to the Clinton inaugural fund. By the end of Clinton's first term John Huang would be at the center of the Democratic Party's fundraising scandal.

Soon the Riadys were enjoying extraordinary access to President Clinton. Huang and the younger Riady began a series of Oval Office meetings with the president. In briefing selected news agencies on November 15, 1996, White House spokesman Mike McCurry admitted that in the first Clinton administration Riady met with Clinton at least six times in a minimum of twenty separate White House visits, and Huang met with Clinton at least fifteen times in ninety-four separate White House visits.

Indeed, when the Indonesian ambassador sought a meeting with President Clinton, he went to James Riady to arrange it. There is little doubt that President Clinton changed government policy because of campaign contributions from the Riady family, though we cannot be certain he changed policy "solely because of a contribution."

In a confidential letter dated March 9, 1993, Mochtar Riady asked the president to extend Most Favored Nation (MFN) status to China. (That same month, the elder Riady flew into Little Rock from Indonesia for a March of Dimes banquet for First Lady Hillary Rodham Clinton, and donated $50,000 in Mrs. Clinton's honor.)

Reversing his campaign stance against MFN-and his insistence that he would not deal lightly with the "butchers of Beijing" - Clinton did extend MFN to China on May 28, 1993. Soon the president was enthusiastically lobbying Congress to grant MFN permanently to China.

In May 1993 Clinton met with Indonesian official B.J. Habibie, over the objections of the president's foreign policy advisers. Riady had requested the meeting. At the meeting Habibie pled his case for President Clinton to meet with then-President Suharto of Indonesia. Habibie must have been persuasive.

Shortly thereafter, Clinton gave a speech to the Export-Import Bank, where Habibie was in the audience. To the surprise of Clinton's foreign policy advisers, Clinton at one point diverged from his prepared remarks - and his foreign policy aides' advice - to discuss Indonesia and declare his intention to meet with Suharto. Referring to Habibie, Clinton said, "I know we have someone here from Indonesia.... We have enormous opportunities there.... I'm going to meet with the president of Indonesia [in Tokyo] to send a signal to the... emerging nations of the world that the United States wants to be their partner in new trade relations.” One of Clinton's foreign policy advisers later said, "We never figured out how the promise to meet Suharto got in there."

And in fact in July 1993 President Clinton did meet with Suharto in Tokyo. He did so, he later told the New York Times with refreshing candor, because, among others, Mochtar Riady had "encouraged me to see President Suharto.” One of Suharto's top priorities at the meeting was to ask Clinton to preserve Indonesia's trade preferences with the United States. Since 1992, the year before Clinton took office, the United States had been reexamining Indonesia's trade preferences under the Generalized System of Preferences in light of that country's abominable treatment of workers.

In February 1994, in the midst of a formal governmental review of whether to permit Indonesia to continue to receive trade benefits, U.S. Trade Representative Mickey Kantor abruptly terminated the review process and formally announced that the administration was allowing Indonesia to keep its trade privileges, valued at more than $600 million a year to Indonesian companies. Indonesian workers might suffer, but the Lippo Group would benefit.

The most curious "consulting fee" paid to Hubbell came from a subsidiary of the Lippo Group. A little more than three months after Hubbell resigned from the Clinton administration under threat of indictment, James Riady of the Lippo Group was particularly anxious to talk consulting fees with Hubbell. Riady did so between his numerous telephone calls and visits to the White House. Riady had already been to the White House about two dozen times since Clinton had become president, but Riady's flurry of White House meetings the week of June 20 may have set new records.

Riady met with President Clinton himself at the White House on Tuesday, June 21, 1994. That Thursday, June 23, Riady had a 7:00 AM breakfast meeting with Hubbell. A few hours later, Riady attended a White House meeting. Immediately after his White House meeting, he repaired to the Hay Adams hotel, across the street from the White House, for his second meeting of the day with Hubbell.

By Saturday negotiations had concluded. Two days after Riady had been shuttling between meetings with Hubbell and the White House, a Lippo subsidiary paid Hubbell $100,000. Before Hubbell received the Lippo payment, he was down to $6,780 in his bank account.

Little was expected of Hubbell in return for these payments, according to unnamed sources cited by the Washington Post. The $100,000 payment was arranged by John Huang, who attended the June 23 meeting with Riady at the White House. The following month, the Clinton administration granted the Riadys' long-standing request that Huang be given a post at the Commerce Department.

President Clinton later said he knew nothing about the Riady payments to Hubbell until 1996, when he "read about it in the press.” Lanny Davis loyally supported his leader, saying Clinton "did not know about any business relationship between Lippo and Mr. Hubbell until he read about it in the newspapers.”

It's funny that James Riady would have neglected to mention that he was hiring Clinton's former number three man at the justice Department during his June 23, 1994, White House meeting - squeezed in between breakfast and lunch meetings with Hubbell. It's also funny that Riady would forget to say anything about it during any of the other visits he would pay to the White House every day that week, leading up to the June 25 $100,000 payment.

During the period of his amazingly profitable consulting fee racket, Hubbell played golf with Clinton on at least one occasion and went to Camp David with the Clintons twice. He also had numerous meetings with White House officials and played golf with vernon Jordan. Hubbell donned his prison blues in August 1995. In his waning days as a free man, White House aides threw him a party, attended by Bruce Lindsey, among others. But in all this time Hubbell's financial situation never came up.

In late 1997 lawyer and Friend Of Bill Douglas Buford stepped forward to tell House investigators that he, and he alone, had been responsible for arranging the $100,000 Lippo payment to Hubbell. Buford is a partner at Wright, Lindsey & Jennings, where Bruce Lindsey was a partner, and where Clinton had worked for two years after losing the governorship in 1980. In an October 23, 1997, deposition, Buford said that Hubbell had called sometime after resigning in disgrace from the Justice Department, and asked Buford to propose that the Lippo group - a Buford client - hire him as a consultant. Buford said he passed the suggestion along to John Huang, and the rest is history.

Buford insisted in his deposition that, despite his "frequent contact" with both Lindsey and the president himself, the White House was completely in the dark about Buford's efforts on Hubbell's behalf. These he made strictly "as a friend." "I wanted to make sure," he explained, "that nobody would confuse the message:" One person who might have confused the message was James Riady, who visited the White House every day for a week before granting Hubbell the $100,000 lump sum payment. Another person who may have confused the message is President Clinton, who one month later acceded to Riady's request to have Huang placed at the Commerce Department.

At the Riady family's urging, Lippo executive John Huang joined the Commerce Department in the summer of 1994, leaving his position as vice chairman of the Lippo Bank to become deputy assistant secretary for International Economic Policy at Commerce. According to sources "who asked not to be identified," the Riadys boasted that they had won the position for Huang on account of their campaign contributions to President Clinton. Just before leaving for his job at Commerce, Huar!g received close to a million dollars in salary and bonuses from Lippo as well as another $700,000 from another Riady company.

While maintaining his ties to Lippo, Huang attended 109 Top Secret briefings at Commerce, involving classified information. Huang repeatedly called Lippo following the meetings. Huang's logbooks recorded weekly meetings with Commerce's Central Intelligence Agency (CIA) liaison officer, which were weekly intelligence briefings on the PRC. Any materials related to the briefing were under the control of the CIA.

In response to congressional inquiries, a Commerce Department official stated, "Mr. Huang received routine intelligence briefings, including intelligence reports. The office that handles intelligence matters does not make a record of each briefing or item provided in the course of briefings. Available records indicate that 37 intelligence briefings were scheduled. Available records show that Mr. Huang saw 15 classified field reports... [and] received 12 finished intelligence reports."

On January 31, 1994, six months after Lippo became full partners with China Resources, the Clinton Commerce Department granted a Top Secret security clearance to Lippo executive John Huang. The normal background investigation required of candidates for Top Secret clearances was waived. Commerce Department security official Paul Buskirk signed a memo stating that the "request for a waiver of background investigation prior to appointment for Huang" had been approved. "Huang has been granted this waiver due to the critical need for his expertise in the new administration for Secretary [Ron] Brown.”

During the six months before he formally joined the government on July 17, 1994, as a principal deputy undersecretary of Commerce, Huang simultaneously held a United States government Top Secret clearance and the vice presidency of an Indonesian corporation that was partners with a Chinese company known to provide cover for Chinese intelligence-gathering operations.

Despite the fact that he was born in mainland China, was educated in Taiwan, had served in the Taiwanese military, had worked in Hong Kong, and was employed by a foreign company, Huang was never given a full field FBI background check prior to receiving, or while holding, a Top Secret security clearance. Instead his interim background check was conducted by the Office of Personnel Management. It did not involve checking his overseas contacts.

Commerce Undersecretary for International Trade Jeffrey Garten tried to prevent Huang from dealing in U.S.-Chinese relations. He assigned Huang to work with Assistant Secretary of Commerce Charles Meissner on boosting U.S.-Taiwanese trade. Garten explained his decision: "Neither Meissner nor Huang have traveled to Beijing nor have they played a high profile role in the JCCT [U.S.-China Joint Commission on Commerce and Trade] process. We plan to keep this separation of function."

Although Huang was supposed to promote U.S.-Taiwanese trade, he tried to spike action on a strategy to do just that out of concern for the reaction of the Chinese government. In a handwritten memo attached to his draft "Proposed Country Strategy for Taiwan," Huang said, "Anything we need to do to delay program with Taiwan, we should do it (to protect what we have accomplished so far in China). Regardless, we need to take a lowkey approach with Taiwan at least before the spring [is] over. We have so much planned with China during this period of time." According to his appointment logs, the day after returning from a January 1995 trade trip to Taiwan, Huang had dinner with Beijing's ambassador to Washington, Li Dao.

Even though Undersecretary Garten had assigned Huang to work a Taiwan portfolio because Huang had never traveled to Beijing and was not expected to, Huang planned a trip to China in the spring of 1995. According to Commerce Department documents released to House Rules Committee Chairman Gerald Solomon (R-NY), this trip was abruptly canceled the same week Huang submitted the South Korean and Chinese visa applications on which he certified a birthdate different from the one on his security clearances.

On September 13, 1995, Clinton met with James Riady, president of Lippo; John Huang, former Lippo employee; and Joseph Girior, FOB and then-Lippo consultant. The Riadys and Huang lobbied the president for a transfer from the Commerce Department to a senior fund-raising position with the DNC. Clinton accommodated the request, directing Bruce Lindsey and Harold Ickes to work out the details. The White House repeatedly described the September 13 meeting as a "meet and greet" social visit, neglecting to mention that it was decided at the meeting that Huang would become a DNC fund-raiser.

On December 3, 1995, one day before Huang left Commerce for the DNC, his boss, Charles Meissner, formally requested that Huang be retained at Commerce as a "consultant" even while he worked for the DNC. Meissner also requested a new Top Secret clearance for Huang for his consultancy. Huang never became a consultant, but on December 14, 1995, the Defense Industrial Security Clearance Office approved his new Top Secret clearance. It was not terminated until December 9, 1996, after numerous stories had been published about Huang's fund-raising activities.

In the 1996 election cycle John Huang raised approximately $3 million for the DNC, about $1.5 million of which the DNC has deemed questionable or improper and has returned. Huang even took the Fifth Amendment, refusing to cooperate with congressional investigators.

President Clinton has defied subpoenas from the House Government Reform and Oversight Committee asking him to turn over government documents detailing his dealings with Riady and Huang. The president is claiming that "attorney-client" privilege exempts him from fulfilling these congressional subpoenas.

Ann Coulter. . Regnery Publishing, Washington, D.C. 1998.

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