Created: 2/10/1998

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The Honorable Fred Thompson Chairman

Committee on Governmental Affairs United States Senate Washington..

Dear Mr. Chairman:

This letter is in response to your8 request that welassification reviewocument that you plan to have the Committee adopt* as part of the public report on the Committee's investigation of campaign finance abuses.

i have reviewed8 redrafted version of the document (copy enclosed). To the extent it contains intelligence information that we provided to thoave determined that it accurately portrays that information and can be mado public without damaga to intelligence equities. In making this determination.ake no position on the analysis or conclusions contained in the document. The Committee obtained informationariety of sources beyond the intelligence community and must draw its own conclusions from all of the information available to it-

I thank your staff for working with us to protect intelligence equities.





The China Connection; Summary ofComnilttee'i Findings Relating to Efforts of the People'! Krpublk or China to. Policies and Elections


From i'i earnest stages, the Commfflee's investigation uncovered iniltr.ce* of poIiu'caJ ccaitnbutiona made with foreign money Either cnotribunng or solxrting thii money have been individuals with buaineu or political tie* to the PRC, who have escorted PRC officials and businessmen to meetings with President .Clinton and Vice President Oore, and who have otherwise facilitated efforts to shape United States policy towards China. The intelligence portion of the Committee'j tovestigation sought'to determine whether tho foreign contributions and the PRC ties were mare coincidence, or if the PRC was in some way behind any foreign polrbcal contributions.

What the Committee learned wai derived not from cooperative witnesses or the-PRC, but from garnering infonnation from our law enforcement and Intelligence- agencies and open sources and piecing it together. Although the Committal received andast amoubt-e* inforrnau'on. there are ocvertfaalesa gaps in what the Commlttae has gathered. And describing these gaps might lead to the iruuivertem-disclosure of certain sources snd methods used to obtain information about Chinese efforts. Mindful of these gaps, tbe Committee has endeavored to report what it has learned faithfully and Accurately

The Committee's ioveidgauon ia this area of necessity proceeded behind dosed doors. Virtually all of the information gathered [by the Committee was cUsnncd, much of it at top secret and compartmented levels. The Committee took extraordinary steps to protect the information from disclosure. Including limiting access to the information to Membersery small number of appropriately cleared at*ff, using secured facilities to maintain materials and to bold briefings, meetings, and hearings, andto (numerous special restrictions plsced by the intelligence agencies regarding the handling of the iitfonnadon. The Committee was also restricted as to what could be preaented in public hearings because of the dasaified status of much of the relevant informanor. The same resmcharts constrain what can be shared ln this report

Although hampered by time conltralota snd spotty cooperation from some federal agencies, the Committee has Veered significant iriferniation. Tho Committee determined. law enforcement and inteUigcaca agencies and open sources thai tb* PRC governmentlan before6 ejections and thai rU goal wis to influence our political process, ostensibly through stepped-up lobbying efforts and also funding from Bdjlng- Over time, the plan evolved and tbe PRC engaged in much more than simplyndeed, discussions took place and actions were taken thai suggest more than tbe origmal plan was being executed, andariety of PRC entities wore acting to. elections.

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Whit followsiscussion of the Majoritywork end tba Cc<nmirtee'i findings in thilhe discussion first providei context for why the Committee pursued this subject, by describing early medii accounts of alleged foroign activnies ud briefings6 by the FBI to Members of Congress and the White House. Next, it addresses In abbreviated form some ofthc slgnbScant connections between tbe campaign finance invecigitioo and the Grtater China areaeluding the das speciSc figures have to tbe PRC government. It then lays out what the Committee learned about the existenceChinand about other, posnbry-rdited activities undertaken by ths PRChfoniunoa regarding the implementation of the plan Throughout the discussion, the Committee describes the tigiifficince it tees in ail of this.

Owing to the sensitrviry of the subject, the Committee has been unable to shire with the American people most of the documentary or testimonial evidence that supports the foOowing discussion, nor can it do so now. Moreover, the Committee will be unable to addreas the subject matter publicly much beyond the precise-wording of the discussion that follows.ooger. more detailed, ana" classified account of the Commiaeo's firv^g* hu been prepared and will bo maintained in accureenvironB.

Initial Inflation* of Chinese fiflhrll to Influence6 CtrnnaJtma

During the investigation'i earnest stages, several seemingly weli-sourood press reports deicnbed the fund-raising efforts of oversets Chinese in thil country snd specuUted on thor posaible rdationabipe to the PRC. Oahe Washington Post fanink between foreign campaign money and the PRCiting "officials fluniliar with thehe ertidc alleged.ustice Department Invtsticstion into improper political fund-raising actrvities has uncovered evjdanoe that represenUtrves of the People's Republic of China sought to direct contributions from foreign sources to the Democratic National Committee before6 presidential campaign.Tha Post observed that crininil invesugsiorshinese connection to tho current fund-raising scandal because several DNC contributors and major ftind-raisera had ties tond identified, in particular, Yah Un "Charlie" Trie and John Huang.

Other media stones preceding the start of tha Coninifflea's public hearings In July reported additional details on covert Chinese plana to fund poUdcal contribution* in this country. Tho New Tofk Dfnts on7 wrote"lurixptitioush/ monitored" conversations between

For the purposes of thia report, tbe term "Cheater China" encompasses territories claimed or recently acquired by the PRC. including Hong Kong, Macao, and the Republic of China on Taiwan.

Bob Woodward and Brian Duffy, "Chinese Embassy Rolo in Contribution*ashington Post,j Al.

feb'9q pm

Chinese officials here trulging "suggested that Beijing was prep trod iorutio rtep: illegally runneling money to American poiiriaaaitme reponcd in Mirch thaionununkariona among Chincae officlalj picked up by American intelligence "indicated that front companiea for the Chine-je government might try to funnelho rmght have directed thia? According to the Washington Post, "top" Diineaa officiali approved plana "to attempt to buy influence with Americannd the plana onnrinuod6 and to the present S

Additional atoriei indicated the ?BI badoreign ccnmtermtdligence probe of the matterriefiog ibt Mambera of Congrats regarding the Bureau's belief"that tbe government of China may try to make comributioru to Memben of Congreis through Asianhe Bureau latereventh Member inhe FBI also told the White House about the Chinese plan inhen FBI agents briefed two representaiivei of the National Security Councilrie&ngi deaaribed illegal plans for the clandeal funding of American poUrical campaign*

Initial IfhliWiQM were Consistent with What the Committee was Diicovering About Foreign Money Being Funneled into6 Ejection!

ha inveatigation, Comrm'ttee staJTumber of money traila that led from the DNC and other Democratic causes back overleaa, and, pcruadartr. to Greaiar China. Tha trails wend their way from foreign countries through one bank account after another, ending up mainly in DNC coffers. Committee staff traced some of these trails backwards asheirehat brought into the United States funds eventually used to make political contributions.?

David Johnston,. Agency Jecretly Monitored Chinesen Political Otfur New York runes,. At.

Richard Ucayo, "What Did Chitaime,

Bob Woodward, 'Top Chinese Linked to Plan to Buyaabiagton Post,. Al.

Brian Duffy and Bob Woodwufl, TBI Warned Six on Hill About Chinaashington Poat,fifl iIm Lacayo, supra, p. 49

Although in several cases Committee stafforoign account that aerved aa the sourceontribution to tha DNC, they could not continue back to the actual trail bead when it waa located overseas aincc the Committee held no authority to compel production of foreign bank record* Henco,ontribution, that entered the US from an account in China, Hong Kong. Taiwan, Macao. Indonesia, or some other country was connected in some way to the PRC government could not ba dmermined from an exanunauoo of the records


Committeecniifiod several instance* of foreign money donations connected to fix individuals with ties to the PRC. Aa noted below. John Huang. Maria Heia, Tad Sioeng. end Jamea and Mochtar Riady each have beendated in some way with the Government of China. The sixth. Yah Lin "Charlie" Trie,umesa partner of Ng Lapacao businessman with alleged tics to tho PRC. Trie, whofrecejrdy waa Indicted and arretted, escorted Wang Jun, need of Chin*'! principal arms trading company. Polytechaologiee.ebruary6 coffee with President Clintoneeting thtday with Commerce Secretary Ron Brown

ohn Huang soli died4 million in contributions to the DNC. Nearly half thia amount has been returned aa the coaxributions were determined by the DNC to have been made with actual or suspected foreign funds. Inuang wrote three checks to the DNC, each in the amount, each paid with foreign money. The checka were drawn on the accounts of three Lippo Grouping Holdings, San Joae Holdings, and Toy Center Holdings. At the time the cheeks were written, all of the companies were losing money and operating in the red. Hearing testimonyuang coworker Indicates tho money for the three contribution checks came from Lippo accounts inn abort,3 checks Huang signed were paid with foreign mosey.

n DNC contributions was made In close proximity to Huang-arranged meetinga between Vice President Gore and Shen Jueren, the headommercial enterprise wholly owned and operated by the PRCs Ministry of Foreign Trade aod Economic CoopersHon. Called China Resources Holdings, Shea's company has been identifiedRC intelligence-gathering operation; one with reported fics to the People's Liberation Army 9 On Friday,he day after Huang wrote the first twohecks to the DNC -Huang escorted Shea JucrenhitetHouae meeting whh Gore and his chief of staff. Jack Ouinn. The following Moodey,, Huang wroUheck to.the DNC. On the same day, Shen Juaren again met with Vice President Gore, this timeanta Monica event organized by Huang and Maria Hals.

Testimony of Juliana Utomo.

Nicholas Eftimiades,Uigence Operations, p.ffimiidtt writes that China Resources HoldingsRC military officer Installedice president. It ahould alio be noted thai,hina Rawnirceei ahare of the Hong Kong Chinese Bank from the Lippo Group.

The RJtdys were Huang's patrons and supporters throughout oil careers at Lippo snd later the Department of Commerce and she DNC. In fact, Jamea Riady inmail meeting in the Oval Offica ont which President Clint oo wu asked if ha would help Huang move from Commerce to the DSC. President Clinton acceded to tho request, and by the end of the yesr, Huang became theicc-chslrmtn ofosition created especially



for him- The Riadya woib alto for many veer* generoui supported of President Clinton end the


Man- Hsia wu involved in soliciting coQtribuaonj to the DNC thai wore laundered through aeveraJ Buddhiat monks and may have derived from foreign source* Once the figures had been taihed for the6 Hat Lai Temple fund-raiser attended by Vice President Gore, it became apparent that the event had not generated the level of contributions expected by the DNC.esult, DNC Finance Director Richard Sullivan asked Huang to "gat some California niocjen/laMO Huang turned xo Mans Una, whocheme wherebyu contributed to the DNC by, temple monastics who, In turn, wee reimbursed out of the Temple's general expense account (The aource of the Temple's money Is believed to bs Buddhist devotees and may derive from, over teas

Ted Sloengwaa one oftbeDNd'i largest contributors during6 federal election cycle. He is alio distinguished as the DNC donor whose corttiburiotu are linked perhaps the most clearly to foreign sources. Sioemri his family, ud his business uterpriiei0 to the5hrough arcview of bankne Committee d that at leaat half,f tht DNC cowributioni wu funded by transfers from overacu accounts. In each cam, money, wu wiredioeng family account in. from the accountong Kong company. Although the Cc^runittce knows little about tho foreign companies that funded Sioeng'shia country, one of tha busfnet sea. Mansion House Securities, ia believed to bc owned in part by the Chinese government.

Yah Unrie also solicited large amount* or foreign money. In Trie'a Case, the cause wu the Presidential Legal Expense Trust, set up to help satisfy the legal bills incurred by President ud Mrs. Clinton Inrie brought nearlyillion dollars In small-dencuTUruiion check* and money orderajto the law office edmmistcring the Trust. Tne checks and money orders, it turned out, were written by followersuddhist Sect called Sum* Onng Hal Muy of the followers were reimbursed In the amount of their coatributioni. Uramatery, the rdmburaement money came from accounts in Taiwan and Cambodia.

10 Deposition of Richard Sullivan,.

None of the aforementioned individuals would apeak to the Committee about their fund-raising activities. Sioeng left the country soon after the taMfsseW finance scandal broke. The Riadys likewise have Stayed out of theUnited States, and declined to meet with Committee staff working in Indonesia. Huang andavehis country but have both auerted their Fifth Amendment priviJega against selfniv^immatioo. Trie utitUfly left die country but recently returned and wu arrested. He wu indicted on8 ud charged onounts, including conspiracy to defraud the DNC and the United State* The indictment charge* Trie with participating in the conspiracy by, hmong otherurchasing access to high level government officials through contributions made to the DNC.

eb b9 s6ph

Campaign Conirihinpra/ pRC rflnrrMljfnj

Information obtained by the Codmtittee reveals dote ties between the PRC and many of the individuali who produced or facilitated foreign campaignnd theseed Sioeng. Maria Hsie, John Huang, .end Jamea and Mochtarnteracted with one-another with lome frequency. Their paths appear to have crossed most often when they were engaged in fund-raising or contributing money to the Democratic National Committee.

ltd SlQCQghe Committee has learned iha: Sioeng worked, and perhaps still works, on behalf of the Chinese government. Sioeng tagulariy cemmunicatad with PRC em bury end consular officials at various locations in [the United States, and, before the campaign finance scandal broke, ha traveled to Beijing frequently where be reported to and we* briefed by Ouncae communist party officials.

The Committee is awareandful of activities Sioeng undertook at the request of or with support from the PRC government; Perhaps the most significant of these activities was Sloeng's purchase in5 of The ItternatianalDailyhinese-language newspaper based In Lo* Angeles. Prior to Sioeng'i purchaseonrrollmg interest in tha paper, The International Dally Newsro-Taiwan slam Sioeng changed that by bringing La new people and altering thedeology to conform with the views of the PRC government. After purchasing the paper, Sioeng subsidised it heavily, which was neceitary due to in operating losses. Sioeng financed the purchase arid subsidization of tha paper through tranrfers of funds from Kong Kong accounte.

Sioeng and his family and business interestsarge role in6 elections. They spent0 on political damp signs and organization,50 on the Democratic National Committeen tbo National Policy Porum. As discussed in greater detailthe Committee has subpoenaed and reviewed vohimlnous bank and bueiaesa records relating to Sfoeng, Ml fsjnfly. and their businesses. The Committee has traced much of the money for theee contributions to bank accounts In Hong Kong but no further. Hence, tha Cornmiuee does not know whether these cctfxtributions derived from or were directed by the PRC government. Records revesl that the PRC consulate in Los Angeles paid Sloeng's Hollywood Metropolitan0heck dated6he Committee has concluded thai the PRC consulate provided Sioeng the money for the purpose of making or

Sju fJftQ chapter of report on Ted Sioeng


ank of China check from the Conaulata General of the People's Republic of China to the Hollywood Metropolitan Hotel

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olitical coturibution lo Dr. Darnelepublican who na Aw the California State Assembly. It appears tan the PRC nooey was to fact used to make orontribution to Wong in0CBtrarctee staff have no means to determine what other fundi might have been provided to Sioeng by tha PRC government through tranaferi among foreign accounts.

Ted Sioengusiness tmpire wtimsted to be worth0 million. The Comrnrtteo hai learned that Sioeng conaidcrcdortion of ma conaiderable weilth to aupport lobbying efforti approved by/ PRC officiali.

Mifll Hill IS The Committee hu learned thai Haia haa been an agent of the Chineie government, that ahe hai acted knowingly in rapport of It. and that aha has anempted to conceal her relationship with tha Chineie government. Tha Committee hu alio learned that Hsie hu worked in direct supportRC dipltnutic post in.

A* described elsewhere in tbe repwt, Hoa huignificant figure in the Committee's investigation, and the Committee hu conducted numerous interviews and depositions and exarnined voluminous rocords relating tb her. Haia first met Vice President Gore in the, andrip he tneadedto Taiwanic has raised monevforthe Dernocratic Senstorial Congressional Cfcmrnirtee CDSCO, and lobbied to have DSCC contributions eexmarked for tben-Senatbrs Gore and Simon, On Septemberhe attended the Santa Monica, California meeting with Vice President Gore, Jack Qulnn, John Huang, and Shen Jueran. In oonnectiod with that meeting, Hsis0 in money illegally laundered through tha Hai Lai Temple.

Haiaong standing rdatioiemp with the Hal Lai temple. She, with Huang, organized the6 fund-raiser held there and attended by Vice President Gore, and Laundered triousands of dollars Illegally through temple denes in connection wttb the event. Tbe Committee hu identified0 inontributions illegally laundered through temple monastics at Hsla's direction. The Committee hu received information that Hsia worked with Ted Sioeng and John Huang to solidt cjonlributioaa from Chinese nationals in the United States and abroad for Dernocratic causes. Hsia ind Huang, in particular, worked together to identify. citizens overseas who might contribute money to Democratic causes.

John HUMSince well betaje its hearings began, the Committee fbeused on John

rand National Bank check from Sundari, Sandra, snd Laureen Elnitiarta to Dr. Daniel Wong.

Sss liafi chapter of report on Maria Haia and the Hsi Lai Temple

5ifi ilafl chapters of report on the Uppo Group, John Huang at the Department of Commerce, and Huang's Wring by the pNC


Huang. The goal wu to urideotand why tn executive at atmaJJ Caiifornia bank (ownedrge fodoneaunho raised money protinoaily for tho Decnoeruo party ud wu tewtrdedpsranent of Cominerce, wu to often and wdj received by President Clinton ud his ittff. The Coramhtse'i interest wu further piqued by the fact that to date, the DNC hu returned half of the money Huang raised6 The DNC hu been unablo to verify that these fundi derivedegal, domestic source.

The Commence hu examined in detail Huang's actrviuot at Lippo, Commerce, and theingle piece of unverified information shared with the Commit! a* indicate* that Huang himself may possibly hiveirect financial reUtionihip with tha PRC government. The Commjttee'i herniation is not corroborated, but nevertheless it sdds to concerns regarding Huang's activities it Commerce, whichocus of Committee hearingi ia7 and are discussed elsewhere in this report.17

Jamet and Mochtar Risrfy it The Comntirtee hu learned from recenth/^cquired urformauoQ that James and Mochtar Riidy hiveong-term relationshiphinese inteUgence agency. The relationship is based oo mutual benefit, with the Rladys receiving usiituce in finding buaineu opportunities In exchange for large rami of money and other help. Although tbe relationship appears bated on business interests, the Committee understands that the Chinese Intelligence agency seeks to locate and develop raUtioctoipi with information collectors, particularly persons with close conrtections to. government.

The Riidys are central figures iri tho campaign finance scandal for several reuona. First, they hive dose tie* with President Clinton Junes ud Mochtar Riady hive known President Clinton since thehen theyontrolling interest in the Worthen Bank. Tbe Riidys have visited Clinton In the WhittJ House on several occasions. Second, the Riadya ware heavy contributors to the DNC and other Democratic causes. They mide and lolcited significant contributions directly in connection with2 ejections, subsequently, various Riady businesses, usodatet, and employees did likewise. Third, they were the employers of John Huug, whom they helped place at the Department of Commerce, then the DNC.

The Committee! LearntChina Pltif .nd Other. Pouiblv Related Effort.

Tbo foregoing indicates that large amounts of money were funntlcd from accounts in Greater China into the DNC by individuals who had close del to the PRC. This activity take* on greater import when viewedin light of foe fact that the PRC government had developed and

chapter of report on John Huang al the Dcpartnum of Commerce

See gkfl chap! en of report on the Lippo Group, John Huang at the Dtp turn rat of Commerce, andhiring by

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Implemented plan* to influence the US* political process before most ox"tbe eforeaMtioaed contributions were nude The Committee firit learned of thaw efforti earry ia the wveatigation.19

To understand the plan one needs to appreciate tha rrmtert from which it emerged. The plan ia imeiTwined with the state of Ambrica's reJarionship in recent years with tha PRC and the Republic of China on Taiwan Akhougii the United States maintain! no official ties with the govenunent on Taiwan,iews Mve tag. diplomatic relatione with the PRC. This li largely because Boeing oanaideriogue province andf seeking Independence from the

ee Teng-hui, President of ihe Repuboc of China onisa to viiit the_ United Stales. Caught bff-gusxd, Beijing wis quick to voice its outrage and to engageeries of overt retaliatory measures. Chins suspended arms control talks with Wsshington, postponed cross-Strait talks with Taiwan, canceled official visits to and from the United States, amassed troopi along the coast ftcing Tsrwaa, and recalled Its ambaaaador to the United States.

But not all of China's reactions aver* overt. Secretly, Beijing worked to prevent similar diplomatic surprise* fromhe nrture. After President Lee'a visit, high-level PRC government officials devised plans to increase China's Influence over. political process and to be Implemented by PRC diplomatic posts In.

Some of Beijing's efforti appear relatively umocuoua, involving learning room about Members of Congress, redoubling PRQIobbying efforti InstabUabmg closer contacts with. Congress, and fimdbg from Bering But the Comrajtte* haa learned that Beijing expected more than limply Increased lobbying from its diplomatic posts in. Indeed, as the Committee examined tbe issue ia geealer detail itroad array of Chinese efforts designed to. policies and [elections through, among otherinancing election campaigns.

The Committee's under standing of the plan derives. law enforcement and intefljgeoce agencies, open aourcea, ana the Committee's own BTvestigarive efforts. It is important to understand that there Is no consensus among tbe agendas concerning where the plan ends and other PRC activities In this coUntry begin. The Committer has learned In severing detailide range cf covertefforts ih. end overseas designed to Influence elections in this country Many of these activities may or may not have been partingle, coordinated effort.oordinated approach may have evolved over time. Other efforts, though

enator Thompsonublic statement on Julyisdosing the existencehina plan and related activities The CIA and FBI edited the statement and authorized Ita public disclosure

B 09 H

undertaken by PRC govommmt entitiei have beenrogue activities Such fine distinctions fiUl beyond the scope of thi* report

Evidence Emereei that the Plan, WB| Info Indented and Other Moil? Wejj^'DdeTlaJieDbvU^ EEC

The Committee hti Ideotificd specific aiepa taken in fititilefince of the plan. Implementation of the plan haa been handled by PRC government official* and individuals' onksted to aaaiat in the effort. Activme* in furtherance of the plan have occurred both Inaide and outaide the United States.

Through the plan and related efforts, the PRC gc>verntnent aimed to Increase China's influence in the United Stales. Some of the efforta were typical, appropriate steps foreign goverrmtenu take to communicate thchj views on United States policy. They included retaining lobbying firms, wviting more Congresspersons to visit China, and attempting to mrnrnunioate Beying's views through media channels' in the United States. However, other efforts appear illegal. law. Although raor. hacuscon of PRC activities focused on Congress, the Committee's investigation euggtiti that China's efforta involved6 Presidential race and state elections as weft The Committee has received infbfnurion that the government ofCr.ru may have allocated minions of dollars6 alone to achievo Us objectives.

The Committee hai learned of several acbvitiei China undertook to influence our political procesm during6 election eyefc. Some of these rnchidt'

A PRC government official deviaecU seeding strategy, under which PRC officials would organize Chinese communitiei in. to encourage them to promote persons from their communities to run in certain stale jtnd local elections. The intent behind the seeding program was to develop viable rsnrliditn sympathetic to the PRC fix future federal elections;

The Gc^rrimeot of China cstshushW the "Central Leading Group. Congressional Affairs'* to coordinate Chou'i lobbying efforts in this country. President Jiang Zemin approved the Group's creation,

A US. agency received fragmentary reporting relating to China's efforts to infiuence. Presidential election. Tne information is considered panriminal ravestigation and cannot be discussed with the Committee further,

PRC intelligence officials discussed be easing China's lobbying efforts in the United States and planned to raise millions of dollars to support thosa efforts. PRC officials met with one or more Chinese businessmen residing outside of mainland China to discuss raising the money and how it would be spent;



offidala discussed tmudog American elections through covert meui;

A politieaury-eendtive transfer of fundi may have occurredRC-controlled account in the

A PRC official Involvediacuisnon concerning Chinese lobbying efforta indicated an awareneai that money placed. banks can be traced. law enforcement offidaia;

A PRC official encouraged ChmcietAmericut to make political contributionj and contact their Congressmen; and

Bdjing wu angered that its diplomatic ofiicisis in. failed to forewarn the Mainland about the burgeoning campaign finance inrnlil and that thoseere not aware of Chinese who want to. for the purpose of lobbying or making political contributions.

These activities show that sevens! different PRC *pvernmcnt entities joined the effort to involve themseive*. elections tad that the PRC wont wnU beyond lobbying to achieve its goals. Whether or not sJl of this wis CfntempUted at the outset by high-ranking Chines* ofSosJ* or simply evolved over time, it cieverthilesi happened, udlsndestin* manner.

It ii dear that illegd foreign contribution* were made to the DNC and that these contributions were facilitated by todrviduals with extensive, ties to the PRC. The original lourcci of many of theseSwm

It is also dear that well before6fflcUli at the highest levels of the Chinese government approved of efforts to increase then. political process- There are indication* that thckcJan or parte of the plan and posribly-related PRC activities were implemented covertly inf this country. The individusls who fiidlhated tha contribution* have either dected to take the Fifth Ametidment or flee the country. Beijing haa denied the Committee's request for us< stance. Moreover, after its hearing* concluded, the Committee learned that the Chinese leadership wu pleased no PRC agencies have yet been implicated in the campaign finance scandal

While the Committee still cannot determine coodusivdy whether the PRC funded, directed, or encouraged the illegal contributions in question, all of the information misted herein, taken together, coitstitutu atrong drctirnstsntial evidence that the PRC government wu Involved In addition, there ere indications that Chinese effort* Inwith6 election* were undertakes or orchestrated, at least In part, by PRC mtdligenoe sgendes. It is likely that the PRC used intermediaries, particularly with restaxd to political contributions Thiso because only US. cituena or legd permanent residents can contribute lawfully to politloal parties and


campaigna. Moreover, the cf bu am tain *nC indrviduall iiommonChineie intelligence and militaryiven iho way the PRC exercises control over certain businesses and individuala, it hardly would be surprising to learn thai the PRC directed overseas Chineee'to contribute to parboular parties or candidates. In sdditlon to furthering the goals of the PRC plan, such actions would aeem within the capabilitiesovernment able to implement private espionage and int eilig encc-gath alng aetiviues.

gather It, which has placed rigmficsnt limits on the Committee's rshat protectionegitimate concern, but it has con

Throughout Ua investigation, the Committee has firmly beheved it Is important for the American people to be made aware of set much of the information set forth in this section of the report as possible. Yet, getting to the bottom of such matters and also sharing the Committee's findings hss been sn extremely difficult proceas. The first difficulty derives from the nature of the merjoa Itself! Some of the information provided lo tbe Committee raruirae the protection of

aourcea andsed to _

ability to discuss these mattershat protectionegitimate concern, but St haa com* tt tha cost of curtailing public knowledge and debate. The Justice Department for the most part would not reveal mattera that were tha subject of hi ongoing criminal investigation. While Justice's concern ia understandable, it limits Congressional oversight and makes it even more Important that prosecutorial decisions b* handleday that ensures pubhc confidence.

Tbe second difficulty is more complex and. ultimately, more troublesome. The Committee dealt at length with various law enforcement and intelligence agencies in developing portions of the information set forth above andecurring problem: the failure to share relevant, classified Information. The failure roeamne agencyomplete picture of all the relevani informationarticular area and,iven agency might ba unaware of all the relevant information It hold within ita various sections orhe clearest example of thli involved tb* FBI and th* Justice Department In two major instances FBI headquarters and Jus tics war* unaware of crucial information located In FBI field office files, information months and sometimes years old. The Information came to tight onlyesult of persiarent Commit? ea probing These lapses are currently thef subjactepartment of Justice Office of lospector General (OIG) investigation. The Cotnjxdtte* has cooperated with OIG urvestigstors and will continue to monitor their progress.

20 Bftimisdcl. supra,. It is also well-established that the PRC wields Influenceide rang* of entities and individuals, many of whom conduct business directly with the PRC. One area In which the PRC employ! businesses Is economic- espionage. State-owned or controlledarticularly those controlled by the People's Liberationre used mcreaaingty as parthinese network to acquire Western technology io the United States and other coon tries. Jane'a Defense Weekly,.nother area Is Intelligence-gathering, where the PRC government baa attempted to cuhrviu membera of the overseas Chinese commuruty ae information sources Efbmiedee, supra,.

P. 13


inuibty of the Bureau to locale certain inference irrfocmation denied the campaign finance criminal Uak force timely acccaarto important cLaieified materials By tht time the information waa rurfaced and paaaed aidng. lome or all of it ought have grown ital*.

he Comrnittee'a hops that, for the sake of future orirolnal urveatigadoni, steps are ukcn by intelligence and law enforcement agencies to cnauni that auch lapses do not reoccur. In that regard, the Committee intends to review anymade by (he OIG on improving how auch information is shared

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