On March 19, 2001, Judicial Watch urged the U.S. District Court in Los Angeles to reject the plea agreement under which Bill Clinton’s friend James T. Riady and the Lippo Bank escaped with what was for them a slap on the wrist for their serious violations of campaign finance laws and other crimes.
The pleading submitted by Judicial Watch is a clear and comprehensive summary of those crimes. It makes a persuasive case that the punishment agreed to by the Reno Justice Department and approved by the Ashcroft Justice Department does not come close to fitting the crimes and should have been set aside. The media coverage of this miscarriage of justice has been confined to reporting the judge’s acceptance of the plea agreement ? a fine of $8.6 million, which will no doubt be paid by the multi-billion-dollar Lippo Group, and 400 hours of community service that Riady may perform in Indonesia.
The Washington Times ran a long editorial on March 26, showing how the Riadys had bought favors from the Clinton administration. It blamed the plea bargain, which was negotiated ten days before Clinton left the White House, on “stonewaller-in-chief ” Janet Reno. It made no mention of the failure of the new administration to retract or revise it or of the Judicial Watch pleading. For the historical record, we are reproducing that pleading in this report with a few changes, including dropping footnotes and attachments, to fit it into the AIM Report format.
THE JUDICIAL WATCH BRIEF
Defendant James T. Riady has reportedly pleaded guilty to felony conspiracy charges related to illegal campaign contributions in the 1996 Democratic fundraising scandal and for other illegal contributions during the past eight-year period. Co-defendant Lippo Bank California has pleaded guilty to 86 relatively minor misdemeanor charges concerning illegal contributions and will pay nearly all of a U.S. $8.6 million fine from the combined multi-billion dollar financial holdings of the international conglomerate known as Lippo Group. The reported terms of the agreement call for Mr. Riady to be sentenced to two-years probation, during which time he will not be allowed to enter the United States except at the invitation of U.S. government agencies. Mr. Riady also will be required to perform 400 hours of community service. This inconsequential punishment simply does not meet the severity and gravity of the deeply corrosive, cynical and manipulative criminal campaign the defendants waged against the American people and the United States Constitution.
In its original memorandum of law, requesting the Court to set aside the proposed plea agreement, Judicial Watch predicted that the Clinton-Gore Justice Department’s rushed processing of this plea agreement was an effort to foreclose any credible investigation into possible criminal conspiracy of an as-of-yet unknown scope centering on John Huang and other witting and unwitting agents of the intelligence services of the Communist government of the People’s Republic of China (PRC). Unfortunately, Judicial Watch’s prediction was entirely accurate. The Associated Press reported on March 13:
Indonesian billionaire James Riady’s cooperation has improved investigators understanding of campaign finance violations, but probably won’t lead to more convictions, prosecutors said in sentencing recommendations released Monday.
The cooperation of Mr. Riady, a key figure in the Democratic campaign finance scandal, “has been helpful to the government in obtaining a complete understanding of the scope and significance of the illegal conduct.
It appears that Justice Department officials have abrogated their responsibility to follow important criminal leads generated by Mr. Riady’s “cooperation.” While the Assistant U.S. Attorney Dan O’Brien now claims to have a “complete understanding” of the violations of law Mr. Riady and his agents have committed against the American people and the Constitution, he is unwilling or unable to pursue justice. It is wrong for the U.S. Attorney’s Office to simultaneously claim complete knowledge of a criminal conspiracy and fail to act in pursuing the criminals involved in the conspiracy. This conspiracy involved a scheme to alter and subvert U.S. foreign policy for the benefit of a foreign corporation, as well as a concerted campaign to purchase and peddle influence and classified information at the highest levels of the federal government. The U.S. Attorney may have a “complete understanding” of Mr. Riady’s crimes, but the American people do not.
There is no “factual basis” upon which the Court may accept the inconsequential plea agreement originally proposed by Defendants and the Clinton Administration. The obvious reason for the U.S. Attorney’s failure to pursue clear criminal violations of law is that as an appointee of the Clinton Administration, he refuses to pursue criminal leads that point to the officials that appointed him to office. Under these circumstances, the requirements of Rule 11(f) do not permit the Court to accept the proposed plea agreement, at least not without a full evidentiary hearing and other satisfactory inquiries into the true and complete facts of this case, including the timing and real purpose behind the Clinton-Gore Justice Department’s offering of this plea agreement.
The Riady Criminal Ring
Judicial Watch has documented Mr. Riady’s and Lippo Group’s substantial interests in China, including real estate, banking, electronics, currency exchange, retail, electricity and tourism. Mr. Riady’s investments, contacts, influence and political savvy made him a valuable resource to Chinese intelligence. His independent wealth and corporate apparatus provided him sufficient infrastructure to establish his own network of corporate operatives in the United States. Riady’s Lippo interests as well as his business ties to the PRC provide both the motive and the opportunity to capitalize on developing a scheme to purchase and peddle influence and classified information, targeting the highest levels of the U.S. government. Mr. Riady’s “business associates,” dealings and contacts reveal a veritable “who’s who” of highly suspect Communist Chinese agents and provide the framework or outline for the entire “Chinagate” scandal documented by the 1997 Senate Governmental Affairs Committee Special Investigation Report, hereinafter the “Thompson Report.”
We wish to remind the Court of Mr. Riady’s more notable associates. These are people with whom Mr. Riady has maintained close and continuous contact over a period of several years, and with whom he has extensive business dealings and deep financial ties. Mr. Riady’s main business partner in China, is Shen Jueren. Shen Jueren is the head of China Resources Holding Company, an espionage front operation for the PRC government’s Ministry of Foreign Trade and Economic Cooperation. Shen has stated on different occasions that “China Resources is a state-owned company and all senior staff are government officials.” Shen has been a member of the Chinese Communist Party since 1955, and an officer of the Chinese Office of Foreign Trade since 1953. Since he has been a member of the Chinese Communist Party since 1955, the Court can conclude that his loyalty remains high to the national interests of the PRC. Shen Jueren met with former Vice-President Gore at a Santa Monica, Cal. fund-raiser on September 27, 1994. This is a further example of the insidious method in which Mr. Riady facilitated and ensured that Shen, his business partner and a Communist Chinese intelligence operative, had access to the former Vice President and close advisors.
Another business partner of Mr. Riady is Li Ka-Shing, the majority owner of Hutchison Wampoa Co., Ltd. ? and partner with the China Ocean Shipping Company (COSCO), the merchant marine arm of the People’s Liberation Army. Mr. Li Ka-Shing is a major shareholder and investor in the China International Trust and Investment Corporation (CITIC). CITIC is run by General Wang Jun, of the People’s Liberation Army ? the PRC’s main arms dealer to Communist regimes, terrorists, and rogue states. CITIC is the parent company of China’s Polytechnologies, an agency that oversees China’s acquisition and sales of weapons, and that it operates as a component of the general staff of the People’s Liberation Army. General Wang Jun was implicated in the illicit shipment of 2,000 AK-47 assault rifles to gang members in California.
Judicial Watch respectfully reminds the Court that these are Mr. Riady’s business associates and contacts, and that under the terms of the proposed plea agreement and the U.S. Attorney’s press release of March 13, 2001, the American public is likely to never find out the details surrounding what the U.S. Attorney claims is a “complete understanding” of Defendant Riady’s criminal conduct.
Mr. Riady’s influence peddling and political-favor bartering paid off in 1996 when President Clinton designated 1.7 million acres of southern Utah as the Grand-Escalante National Monument. The Clean-Air Act eliminates the use of many types of coal by U.S. power companies with the exception of hyper-low sulfur coal. This type of coal is known to exist in only three locations: 1. an extremely remote area of Colombia; 2. Kalimantan Island in Indonesia and 3. Grand-Escalante National Monument. The creation of this national monument gave the coal deposits on Kalimantan Island that are controlled by the Riady family and the Indonesian government a near monopoly on the sale of the sought-after coal.
President Clinton explained that the creation of the Grand-Escalante National Monument was done out of environmental concern to protect the land from development. However, the Court, respectfully, must conclude that there was no such environmental concern regarding Grand-Escalante National Monument. In 1997, the Clinton-Gore administration awarded Conoco Oil Corporation an oil-drilling contract for the Grand-Escalante National Monument. Mr. Riady appears to have successfully cashed-in a political favor with the Clinton administration in order to gain a coal monopoly.
Convicted felon John Huang’s ties to James Riady, Indonesia’s Lippo Group and the Chinese government run deep. Huang and his family are from the Chinese coastal province of Fujian, which is the Riady family’s home province. In the early 1980’s Huang joined Union Planters Bank of Memphis. Union Planters sent Huang to Hong Kong in 1983 to open a branch office for the bank. Due to a lack of business in the agricultural trade, Union Planters closed its Hong Kong branch office. Huang was then hired by the Riadys and held several positions within Lippo’s banking operations for the next few years. In 1986, the Riadys transferred Huang to the Lippo banking operations in California. John Huang became Mr. Riady’s “man in America.”
In 1988, Huang, Riady, and convicted felon Maria Hsia created the Pacific Leadership Council as a Democratic fund-raising operation and an instrument to attract more Asian-Americans to vote for Democratic Party candidates. Huang, in conjunction with the Pacific Leadership Council organized and sponsored a 1988 Democratic fund-raiser at James Riady’s Brentwood home in Los Angeles. At this event Mr. Riady raised $110,000 for the Democratic Senatorial Campaign Committee (DSCC). The Washington Times reported on May 12, 1997, that four days after this event Mr. Riady wrote a highly detailed memo to Ms. Hsia instructing her to “follow up and let me know of progress” in pursuing the numerous quid pro quos that Mr. Riady had stated in a document named “DSCC Issues and Agenda.” Huang sponsored and organized with Hsia the now-infamous April 29, 1996 fund-raiser at the Hsi Lai Temple, where former Vice President Gore illegally engaged in campaign fund-raising.
At the direction of Riady, Huang was one of the tour guides for a 1989 trip to Taiwan, Hong Kong and Indonesia by Senator Al Gore and California Lt. Governor Leo McCarthy. Foreign travel, business forums and “community outreach” events were expertly arranged and exploited by Riady and his agents to include felons Huang and Hsia, to cultivate relationships and contacts, as well as serving as a means to personally ingratiate themselves with politicians and their fundraising staffs.
On August 12, 1992, at the direction of Defendant Riady, Huang issued a $50,000 check from Hip Hing Holdings to be sent to the Democratic National Committee Victory Fund. Hip Hing was a Riady-owned shell company under Huang’s control. John Huang remained the faithful subordinate of James Riady. At Riady’s direction, Huang was maneuvered to a position at the Department of Commerce. Huang was given a security clearance in January of 1994 in anticipation of his imminent assignment to the Commerce Department. Huang did not actually report to work at the Commerce Department until July 18, 1994, giving him five-and-a-half months of unlawful access to highly classified material.
CIA Briefs John Huang
At the Commerce Department Huang was the Principal Deputy Assistant Secretary to Charles Meissner, Assistant Secretary in Charge of the International Economic Policy Bureau. Incredibly, while in this sensitive position, Huang reported to Riady by phone many times each business day. He had access to classified material, and he received at least 37 intelligence briefings, including sensitive “raw intelligence” from the CIA. After these briefings, Huang frequently used office space, phones and equipment in the Washington office of Stephens, Inc., of Little Rock, Arkansas located across the street from the Commerce Department.
On June 5, 1995 as the CIA briefer came out of Huang’s office, he noticed that Huang’s next appointment was with Minister Wang of the Chinese Embassy. On October 11, 1995, Huang took a cab from the Commerce Department to an evening event at the Embassy of Indonesia. The next morning he took a cab back to the Commerce Department from the official residence of the Chinese ambassador. Such “placement,” “access,” motive, opportunity and history of contacts suggests that Huang was engaged in espionage. Clearly his controller was James Riady.
The Court should consider the following “unusual” chronology of events in considering the scope and depth of Mr. Riady’s crimes. Former Associate Attorney General Webb Hubbell, Hillary Rodham Clinton’s Rose Law Firm partner, met with Mrs. Clinton on Monday June 20, 1994. On Thursday, June 23, 1994, Mr. Riady met Mr. Hubbell for an unusual back-to-back breakfast and lunch set of meetings. Mr. Riady returned to the White House for a third time that same day (Thursday, June 23, 1994), while John Huang made two visits to the White House that day as well. On Monday June 27, 1994, the Lippo-controlled Hong Kong Chinese Bank paid Webb Hubbell $100,000 from a Riady company account. Hubbell has refused to disclose to federal investigators why he was given $100,000 by Mr. Riady.
On October 12, 2000 the Far Eastern Economic Review reported that Defendant Riady had invited then President Bill Clinton to join the board of Lippo Group as soon as the President left office in 2001. Mr. Riady’s admitted inducement of bribery is a crime unto itself. Mr. Riady’s shameless, continued influence-peddling and political-favor trading is outrageous, given that he was supposedly “cooperating” with investigators at the very same time he admitted soliciting the president.
On September 13, 1995, Defendant Riady brokered Huang’s job assignment in the Oval Office, with the personal participation and assent of President Clinton. Mr. Clinton’s memory however, is apparently not as keen. President Clinton told Justice Department campaign finance task force that he had “no specific recollection” of conversations he had with Mr. Riady during an August 1992 limousine ride when Riady promised to funnel $1 million into his presidential campaign. President Clinton claims to recall only that “sometime in ’92 after I became the nominee” Mr. Riady had promised to help his campaign.
Riady’s Record Demands Justice
The Associated Press has reported that:
Government documents said that the Lippo Group hoped to influence American foreign policy for its own advantage. Among its goals was to gain most favored nation trade status for China; normalization of U.S. relations with Vietnam; open trade policies with Indonesia and certain U.S. legal changes that would benefit the bank’s business opportunities.
Mr. Riady achieved all of his Lippo Group objectives. The old adage, “Crime does not pay” must be upheld by this Court. Mr. Riady’s plea agreement does not effect any meaningful punishment on him personally or his multi-billion dollar empire. The U.S. Attorney’s proposed punishment for the Defendants amounts to a “nuisance.” Riady, Lippo Group and their agents “bought” changes in U.S. government policy through bribery. Somehow the Justice Department has successfully “talked away” Mr. Riady’s crimes to the point where they are administrative filing errors. The Court must not let this blatant violation of law be minimized to the point where the integrity of the U.S. Courts is called into question for refusing to demand accountability from prosecutors who shy away from tackling politically difficult or embarrassing cases.
Not In The Public Interest
Sweeping all this under the rug, the proposed plea addresses only misdemeanor violations of routine administrative reporting requirements of the Federal Elections Commission. The proposed punishment does not “fit the crime” and prevents future investigation by prosecutors untainted by obvious conflicts of interest. The Court must, respectfully, view this plea agreement as insultingly simplistic, deliberately misleading, and factually untrue. The Court must, respectfully, reject the proposed plea agreement in total.
In addition, the Court also must reject the proposed plea agreement because it is contrary to the public interest. Accepting the proposed plea agreement will further undermine the public’s already damaged sense of trust and confidence in our system of justice, because the Justice Department appears to have no plans to prosecute President Clinton or Vice President Gore, who courted Mr. Riady during White House visits, did Mr. Riady’s bidding, and benefitted substantially from Mr. Riady’s illegal campaign contributions.
Accepting the proposed plea agreement, with its recommendation of punishments that upon examination amount to nothing more than a minor nuisance to the defendants, flies in the face of facts which suggest that far more serious offenses were committed by Riady and his agents.
Another figure in the campaign finance scandal, Mr. Johnny Chung?who did not engage in espionage and did not flee the United States, but instead cooperated fully with all U.S. government agencies and the U.S. Congress?received 3000 hours of community service from U.S. District Court Judge Manuel L. Real as part of his sentence. The Democratic National Committee (DNC) even recommended that the Court “throw the book” at Mr. Chung since they were “victims” of his campaign donations. Judicial Watch is puzzled by the silence of the DNC in the instant matter before the Court
Mr. Chung is unique in this on-going scandal; the cooperation and excellent memory he demonstrated before congressional committees, Justice Department investigators and in deposition taken by this public interest law firm, are notable and praise-worthy. Riady, who fled to Indonesia and “stonewalled” investigators for years, reportedly will be required to perform only 400 hours of community service?either in Jakarta, Indonesia or in the United States?should he ever choose to return to this country. It is even questionable whether this “punishment” will ever be enforced. The gross disparity between the punishments received by Mr. Chung and Mr. Riady, and the obvious, preferential treatment being given to Mr. Riady, will undermine the public faith in the impartiality of the justice system.
Surely, the public interest demands that a full investigation of all wrongdoing and violations of law be undertaken before any plea agreement can be accepted by this Court.
In some instances, major figures in this scandal have chosen to simply flout the law with frivolous, excessive and improper invocation of constitutional claims as well as sudden, profound loss of memory. In five continuing depositions taken of him by Judicial Watch thus far in Judicial Watch, Inc. v. U.S. Department of Commerce, Civil Action No. 95-0133 (RCL) (D. District of Columbia), John Huang invoked the Fifth Amendment nearly 2,500 times.
On 140 occasions in these depositions, U.S. Magistrate Judge John M. Facciola, a Clinton appointee who has shown a regard for the law, without regard for politics, has recommended that Huang be held in contempt for failing to answer questions properly put to him by Judicial Watch.
Acceptance of the Defendants’ plea agreement, which provides no guarantees that Mr. Riady will cooperate, and, indeed, may not even be enforceable if Mr. Riady returns to Indonesia, will no doubt lead the American public’s interest in justice down the same dead-end street of denials, dissembling and amnesia.
This Court is now one of the few sources of hope for the American people that its expectation of honest and open government will be repaired. As respected columnist William Safire recently noted in The New York Times:
Staring us in the face is this stunning assertion now harder than ever to controvert: An American president’s foreign policy decisions were substantially influenced by unlawful campaign contributions at crucial times from a foreign source. In my view, that inescapable judgment will be more damning in history’s eyes than Whitewater cover-ups or any abuses for which Clinton was impeached. But the election law was broken and the reluctant Justice Department had to be hounded by a vigilant press and frustrated Congress into doing even part of its duty. Riady’s much-needed money passed and Clinton’s favors were done and America’s Asian policies were changed. No nostalgic spinning or pleas to move on will ameliorate that betrayal of trust.
This Court has an opportunity to correctively seal the breach in our national security and hold accountable those who would contribute to the destruction of our way of life. This Court, by rejecting the proposed plea agreement between the Defendants and the Clinton Administration, will protect and preserve the faith of the nation in its system of justice.
What You Can Do
Send the enclosed cards or your own cards or letters to David Pecker CEO, American Media, Inc., to Craig Brinkley and Judge David B. Sentelle U.S. Court of Appeals for the District of Columbia Circuit.