IN CONNECTION WITH 1996 FEDERAL ELECTION CAMPAIGNS
FINAL REPORT of the COMMITTEE ON GOVERNMENTAL AFFAIRS
SENATE Rept. 105-167 - 105th Congress 2d Session - March 10, 1998
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| INVESTIGATION OF ILLEGAL OR IMPROPER ACTIVITIES IN CONNECTION WITH 1996 FEDERAL ELECTION CAMPAIGNS FINAL REPORT of the COMMITTEE ON GOVERNMENTAL AFFAIRS SENATE Rept. 105-167 - 105th Congress 2d Session - March 10, 1998 |
ADDITIONAL VIEWS OF SENATOR ROBERT BENNETT It is my intention to address the question of Mr. John Huang in more detail and in another forum. Attached are unclassified answers from the Directors of the Central Intelligence Agency and the Federal Bureau of Investigation to questions I submitted to them on July 28, 1997. Central Intelligence Agency, Washington, DC, November 3, 1997. Hon. Robert F. Bennett United States Senate Washington, DC. Dear Senator Bennett: Enclosed are the unclassified responses to the questions you submitted to the Director of Central Intelligence on 28 July 1997. (We have previously provided classified responses to the Office of Senate Security.) As you will note, we were not able to provide unclassified responses to all the questions you raised. For those questions to which it was possible to offer unclassified answers, the information was drawn from a variety of domestic and foreign open sources. While we have included references to specific publications in a number of these answers, these references should not be regarded as a CIA endorsement of either the publication or the specific information that is cited. In your comments during the hearing on 7 October 1997, you expressed dismay because our original response to you did not include unclassified answers. Since the initial receipt of your questions in July, our goal has been to provide you and the committee with responsive answers. For most of your questions, unclassified answers are incomplete and therefore inherently inadequate (a judgment that is obvious from a comparison of our classified response of 3 October with the information we are able to provide in the attachment to this letter). It is important to understand why so little unclassified information is available on the issues about which you asked questions. The focus of the mission of the Central Intelligence Agency is to collect and analyze foreign intelligence information that is generally sensitive and therefore classified. On the specific issues now before the committee, much of CIA's information is obtained from sources and methods that are particularly sensitive. I understand your desire to address publicly important questions raised in the course of the committee's investigation, but the nature of this Agency's work necessarily limits the information available for public release. Please feel free to call me if you have any questions or concerns on this matter. Sincerely, David P. Holmes, (for John H. Moseman, Director of Congressional Affairs.) Question 1. Has the Intelligence Community been officially tasked to report on Chinese government attempts to influence the American political system? Answer. The CIA as a matter of regular practice reports to senior US policymakers on Chinese activities, including attempts to influence US policy. The Agency brings this information to the policymaker in several ways.Sometimes, the disseminated reporting is sent directly to our customers. Finished intelligence also plays a large role-- through the National Intelligence Daily, the Economic Executives Intelligence Brief, and numerous briefings, intelligence reports, and memoranda tailored to meet specific requests and audiences. Question 2. As a deputy director of the PLA's Liaison Department, does Deng Maomao have any responsibility for media placement or other attempts to influence the American political system? Answer. We cannot provide an unclassified response that answers this question. A classified response has been provided to the Office of Senate Security. Question 3. Did the Chinese Communist Party's United Front Work Department play a role in Chinese efforts to influence the American political system? Answer. We cannot provide an unclassified response that answers this question. A classified response has been provided to the Office of Senate Security. Question 3a. Did the Second Department of the PLA's General Staff Department play a role in Chinese attempts to influence the American political system? Answer. We cannot provide an unclassified response that answers this question. A classified response has been provided to the Office of Senate Security. Question 4. How much money does the Intelligence Community devote to China? To Russia? Answer. We cannot provide an unclassified response that answers this question. A classified response has been provided to the Office of Senate Security. Question 5. How many Chinese language officers do you have at Level 2 or better? How many Russian linguists? Answer. We cannot provide an unclassified response that answers this question. A classified response has been provided to the Office of Senate Security. Question 6. What is the relationship between Stanley Ho and Beijing authorities, especially the Chinese Communist Party? Answer. According to various Hong Kong press reports, gambling magnate Stanley Ho was awarded Macau's casino monopoly in 1962. He is the Managing Director of the Sociedade de Turismo e Diversoes de Macau (STDM), which operates nine casinos, the Macau Jockey Club, and several hotels and banks in the territory. According to Dow Jones, Ho also holds a 14 percent share of Air Macau. The airline's majority shareholder is a wholly-owned subsidiary of the Civil Aviation Administration of China. Press reporting indicates that Ho's relationship which Beijing is characterized by mutual suspicion. Accounts in the Hong Kong press claim that Beijing is uncomfortable with Ho's gambling monopoly and has long sought to ensure greater influence--including efforts to secure seats on STDM's board of directors--over the billions of dollars in tax revenues the concession generates for the Macau government. The Far Eastern Economic Review reported on 6 September 1996 that Ho is increasing his investments in China. Question 6a. What is the relationship between Ted Sioeng and Beijing authorities, especially the Chinese Communist Party? Answer. We cannot provide an unclassified response that answers this question. A classified response has been provided to the Office of Senate Security. Question 6b. What is the relationship between Beijing authorities and Charlie Trie [pronounced Tree]? Answer. We cannot provide an unclassified response that answers this question. A classified response has been provided to the Office of Senate Security. Question 7. What is the business relationship between Ng Lap Seng [pronounced Ung Lop Song] and Charlie Trie? Are they partners in Ng Lap Seng's Hong Kong Food City operations? Answer. We are aware from open source materials, including the Wall Street Journal, that they are close associates and that Mr. Trie appeared to have helped Mr. Ng establish a subsidiary of his Macau-based property development corporation here in the United States. The same reporting also shows that Mr. Ng subsidized a number of Mr. Trie's business activities here in the United States. Question 8. While a member of a White House U.S.-Asia advisory group, Charlie Trie received a CIA briefing on Asian economic issues. How many classified briefings did Charlie Trie receive? How many classified documents did Charlie Trie receive or review? Please furnish the contents of all classified briefings and documents that Charlie Trie received. Answer. On 23 April 1996, analysts briefed the 18-member Presidential Commisson on U.S.-Pacific Trade and Investment at the unclassified level on the general economic outlook for East Asia. Mr. Trie, as a member of this Commission, was present at the briefing. The briefers provided a general overview of China's economy, it's importance to the global economy, and its major trade and investment partners, especially those in East Asia. It also covered China's, Hong Kong's, and Taiwan's economic futures. No classified information was disclosed or furnished. Question 9. What is the relationship between Ted Sioeng and James Riady? Answer. Indonesian press reporting shows an indirect link between Ted Sioeng and James Riady through the Tanuwidjaja family of Indonesia. The Riady family and the Tanuwidjaja family are reported in the press as long-time friends. Sioeng is related by marriage to the Tanuwidjajas--one of his daughters is married to Subandi Tanuwidjaja. There are also business connections--the Tanuwidjaja family bought into the Worldwide Golden Leaf company, which distributes the same Chinese cigarettes as Sioeng's companies. Question 10. What ties does Mr. James Riady have to Beijing officials? Answer. A variety of press reporting shows that James Riady--the eldest son of Mochtar Riady--is in charge of Lippo's Indonesian operations and plays a substantial role in managing Lippo's international businesses, particularly in Hong Kong, where he is Deputy Chairman of Lippo Limited, which controls most of Lippo's investments in China. According to Moody's International, Lippo has 17 of its 138 subsidiaries and 13 of its 30 affiliates incorporated in China. Almost all of these are joint ventures with local, regional, and central governments in China. Lippo has provided financial backing for large-scale public works projects; for example, Lippo has provided concessionary-rate loans to finance many of these projects in key party members' home areas. Question 11. What ties does Stephen Riady have to Beijing officials? Answer. Stephen Riady lives in Hong Kong and is the Chairman of Lippo Limited, which manages Lippo's investments in China. U.S. business press reporting states that Lippo has substantial interests in China--about $2 billion in the Riady's ancestral province of Fujian alone. These include real estate, banking, electronics, currency exchange, retail, electricity, and tourism. According to Moody's International, Lippo has 17 of its 138 subsidiaries and 13 of its 30 affiliates incorporated in China. Almost all of these are joint ventures with local, regional, and central governments in China. Lippo has provided financial backing for large-scale public works projects; for example, Lippo has provided concessionary-rate loans to finance many of these projects in key party members' home areas. Question 12. What relationship did John Huang develop with Chinese authorities while he was a banker in Hong Kong? Answer. U.S. press reports claim that John Huang worked for the Lippo Group, which is a co-owner of the Hong Kong Chinese Bank with China Resources--owned by China's Ministry of Foreign Trade and Economic Cooperation. In January 1994, Lippo Group and the State of Arkansas sponsored five Chinese government officials--four from the Ministry of Foreign Trade and Economic Cooperation and one from the China Friendship Service--to visit the United States. The group named Huang as the contact person for their group. Question 13. What advice did the CIA give to the Federal Reserve on the China Construction Bank (CCB) licensing application? What role did Ted Sioeng have in the license application? Answer. We cannot provide an unclassified response that answers this question. A classified response has been provided to the Office of Senate Security. Question 14. Concerning Ted Sioeng's ``Red Pagoda'' brand cigarettes concession, how did he obtain the concession? What area does it cover? The U.S.? Southeast Asia? What is its value? Answer. According to U.S. press reports, including Business Week, Mr. Sioeng made money in the late 1970s by selling refurbished tobacco equipment to China's Yunan Province. He was later granted government rights to manufacture and export Hongtashan (``Red Pagoda Mountain'') cigarettes throughout the world. The producers of Hongtashan cigarettes made pre-tax profits of $975 million in 1996, according to press reports. A company official told the press in May that the Yuxi Cigarette Plant in Yunan Province earned $115 million in foreign exchange last year through export. Question 15. What relationship does Ted Sioeng have to the Iowa Wesleyan College? Answer. According to U.S. press reports, including Business Week and Time, Mr. Sioeng has donated money to Asian-American groups and his donations to Iowa Wesleyan College were recognized with an honorary doctorate. Question 16. What relationship does Ted Sioeng have with Mr. Chio Hocheong of Macao? Answer. Our review of Hong Kong and Western press reporting shows that Chio Hocheong is a Macao legislator and nightclub owner. He won a seat in Macao's September 1996 legislative elections. Chio ran under the banner of the Macao Economic Promotion Association, which was backed by the territory's gambling, entertainment, and property development interests. Press reporting is unclear about the nature of the relationship between Ted Sioeng and Chio Hocheong, if there is any. Question 17. Johnny Chung started seven California companies with Chinese nationals as officers, directors, or shareholders. Who are the Chinese nationals involved in these businesses?: What relationship does Johnny Chung have to the China International Trust and Investment Corporation aka CITIC? Answer. We cannot provide an unclassified response that answers this question. A classified response has been provided to the Office of Senate Security. Question 18. What relationship do the Riadys have with CITIC? Answer. We cannot provide an unclassified response that answers this question. A classified response has been provided to the Office of Senate Security. Question 19. What relationship does the CP Group of Thailand have with Beijing authorities? Answer. The Charoen Pokphand (CP) Group is the single largest foreign investor in China with, according to a Harvard study on major corporations in ASEAN, 130 joint ventures and subsidiaries in 27 provinces worth about $3 billion. More than 60 percent of CP's revenues come from China. CP's investments are diversified in numerous industries including agro-business, auto parts manufacturing, real estate, telecom, and energy. CP first entered the Chinese market in 1979 in the agro-business sector--this has since become the dominant source of earnings for CP, contributing about 50 percent of the company's overall total. CP is the world's second largest producer of chicken boilers and operates more than 100 feed mills in more than 12 countries, according to Western Press reports, including Reuters. China alone holds about 70 feed mills which produce most of more than 6 million tons of chicken feed per year and process more than 2 million birds a week, holding substantial market share. CP is China's second largest motorcycle dealer and holds more than a 15 percent market share in one of China's fastest growing industries. CP also is heavily invested in real estate development in Shanghai. CP founded its subsidiary Chia Tai, a Chinese translation of its Thai name. The Chia Tai Group name is almost always used for business ventures, meeting with Chinese officials, and making charitable contributions. CP was unique from other foreign investors, who concentrated mainly on industry. In addition, CP continued to invest in China after the Tiananmen incident when other investors either stopped or slowed their investment. CP also makes generous contributions to charitable and infrastructure projects. In 1991, Dhanin delivered $1.9 million to Chen Hong, Chinese Vice-Minister of Civil Affairs and Secretary General of the China Committee of the ``International Decade for Natural Disaster Reduction,'' for relief assistance to China's flood-stricken areas, according to official Chinese press. Question 19a. What relationship does the CP Group have with the PLA? Answer. Both the PLA and CP have ventures in the retail petroleum business, according to several press reports. Question 19b. What relationship does the CP Group have with CITIC? Answer. Western press reporting shows that the CP Group is the single largest investor in China--concentrating in agro- business and auto parts--and CITIC is the primary vehicle for foreign direct investment into China, making commercial interaction between the two organizations likely. Question 20. Does the CP Group do business with or in Iran, Iraq, Syria, or Libya? Answer. We cannot provide an unclassified response that answers this question. A classified response has been provided to the Office of Senate Security. Question 21. What are the business relationships between Gregory Luchanskiy of Nordex and Vadim Rabinovich of OSTEX? What business relations do either of them have with Roger Tamraz? Answer. We cannot provide an unclassified response that answers this question. A classified response has been provided to the Office of Senate Security. Question 22. Does the China Ocean Shipping Company (COSCO) have a business relationship with Johnny Chung, Charlie Trie, John Huang or Ted Sioeng? Answer. According to U.S. press reports, Johnny Chung brought a COSCO executive into the White House. COSCO's shipping fleet handles about 85% of Chinese exports to the United States. Question 23. Is it true that the last National Intelligence Estimate on the Chinese military was issued in 1992? Is it also true that a draft NIE on the PLA was prepared by the CIA last summer but was suppressed by an outside panel of experts? Answer. We cannot provide an unclassified response that answers this question. A classified response has been provided to the Office of Senate Security. Question 24. In 1976 CIA Director George Bush established a Team B to have a second look at Community reporting on the Soviet Union. Team B was composed of outside experts who were critics of the reporting at the time and who later became the leading policymakers of the Reagan Administration. Would you consider a Team B for China headed by, for example, former Ambassador to Beijing James Lilley? Answer. We cannot provide an unclassified response that answers this question. A classified response has been provided to the Office of Senate Security.