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Manna From Hong Kong

More evidence emerges to show that the Republicans also took Asian campaign money

By Michael Weisskopf

Barbour

(TIME, May 12) -- Bill Clinton's Democrats are giving new meaning to the term political payback by promising to return $2.5 million in foreign-tinged contributions by June 30. It turns out they may not be the only ones to need a refund policy. The Republican Party, quick to condemn Democrats for their foreign connections, now appears to have taken campaign cash from thinly veiled Asian interests in the early 1990s.

At least $122,000 in questionable contributions came from Young Brothers Development--USA, the Florida-based subsidiary of a Hong Kong real estate and aircraft brokerage. According to documents examined by TIME, the Florida company gave $75,000 in soft money to the Republican National Committee in late 1991 and an additional $47,000 sprinkled over the next three years. While foreign subsidiaries are allowed to contribute money generated in this country, the sole income earned by Young Brothers Development--USA is the rent from its only U.S. asset: a modest condominium in Washington's Georgetown section. Sources in the company told TIME that the campaign funds were transferred directly from Hong Kong headquarters.

The man who calls the shots there is Ambrous Tung Young, a low-profile tycoon who, friends say, grew up in Taiwan, acquired U.S. citizenship, then renounced it. Exactly when he gave up his U.S. passport is unclear but relevant: foreign nationals are not allowed to participate in decisions by their U.S. subsidiaries about campaign contributions.

Young Brothers Development--USA is the company TIME previously identified as the G.O.P.'s secret China connection. The firm has rescued Republicans in the past two elections with a $2.2 million loan guarantee, $500,000 of which the firm eventually swallowed. Though the funds originated with the company's Hong Kong parent, that transaction appears to have been embarrassing but legal, since it was funneled through an R.N.C. think tank, the National Policy Forum, rather than the party.

Not so the $122,000 in soft money given to the R.N.C. Former party chairman Haley Barbour, who engineered the loan guarantee, has insisted that the G.O.P.'s white knight is all-American. Last week, however, R.N.C. spokeswoman Mary Crawford backed off that assertion. While the party has "nothing in our records" to indicate that Young Brothers Development--USA is foreign-owned, she said, R.N.C. lawyers will investigate the issue, and money will be returned if it was generated overseas. She hastened to draw whatever party distinctions were left: "We have never had an orchestrated program to solicit funds from foreigners."

Disclosure of Young's role in the 1994 loan guarantee has turned the political tables in Washington for the first time since the election. Democrats on the Senate and House committees investigating 1996 campaign irregularities seized the moment to demand subpoenas of Young, his employees and company records. "There are possibilities here of...illegal foreign contributions," said Senator Carl Levin of Michigan.

Young, who represents European and U.S. aircraftmakers in Asia, has refused to be interviewed. Friends say he is a self-made man who worked his way to the top of Asia's competitive aerospace market by selling used aircraft parts across the region in the 1960s and '70s, sleeping in bus stations and bathing in airport rest rooms to save money. He rose to a position of power in the G.O.P. organization Republicans Abroad, and served as regional coordinator for George Bush in 1988 before giving up his U.S. citizenship.

Two of Young's associates came forward last week to clarify how the loan guarantee evolved. An overture for the guarantee came in mid-1994 at a dinner with Barbour as host for Young at Sam & Harry's, a Washington haunt popular with politicians. Barbour said the G.O.P. think tank would use the loan to pay back its start-up money to the R.N.C., which was then gearing up for the midterm election. Indeed, the think tank transferred $1.6 million to the R.N.C. three weeks before the triumphant G.O.P. takeover of Congress. Young received a taste of the victory in a meeting with Newt Gingrich a few days before the Speaker took the House gavel. The event was arranged as a "personal favor" to Barbour, according to a record kept by the Speaker. And that was not the last favor. A year later, when Barbour was invited to meet Chinese Foreign Minister Qian Qichen in Beijing, he took along Young, giving an aviation salesman rare access to the world's fastest-growing aircraft customer.

--With reporting by Michael Duffy/Washington





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