China's President Personally
Created Clinton Money
Cover Story - FBI Tap
By Carl Cameron
WASHINGTON - Fox News has learned that cover stories provided by Chinese operatives to hide China,s illegal campaign contributions may have come from or been approved by President Jiang Zemin. Transcripts of FBI wiretaps obtained by Fox News also point to the possibility that President Clinton may have known of both the illegal donations and what was to be said if they were discovered.
New details of China's acquisition and distribution of U.S. weapons technology appear in a congressional report, Fox News has also learned.
A great deal of China,s illegal contributions to 1996 Democratic campaigns passed through Johnny Chung, a Taiwan-born U.S. citizen who received $300,000 from the head of Chinese military intelligence to be given to the Democratic National Committee and Clinton,s re-election campaign. When the contributions were discovered, Chung was charged with making illegal donations, and later pleaded guilty.
Chung last week told Congress he was under orders from the Chinese to keep the whole thing quiet. His orders, he said, came from a suspected Chinese intelligence operative named Robert Luu, who worked for a Los Angeles law firm.
In a phone conversation tapped by the FBI, Chung was told by Luu to say the campaign money came from the so-called princelings: Chinese leaders, grown sons, who live, study and often live lavishly in the West.
A transcript of the wiretap, obtained by Fox News, contains the following:
Luu: "Shove the blame on the shoulders of the princelings."
Chung: "So blame it on the princelings. Do not implicate the Chinese government."
Luu: "Yes. Chairman Jiang agreed to handle it like this; the president over here also agreed."
Since both men were in the United States when the call occurred, those words -- "the president over here also agreed" " may indicate that President Clinton and China's President Jiang Zemin had agreed on how to spin the story if it got out.
The White House has strongly denied any such thing occurred.
Chung's contacts with Chinese intelligence were well known to Luu.
Chung' s primary contact was Lt. Col. Liu Chaoying of the People,s Liberation Army. She arranged the meeting between Chung and Gen. Ji, chief of China's military intelligence, who provided Chung with the money for campaign donations.
Robert Luu told Chung never to tell investigators about two U.S. satellite firms, Loral Space and Hughes Electronics, or their relationship with Liu Chaoying who, as head of China Aerospace, the company that lofts American satellites into orbit on Chinese rockets, had negotiated their Chinese contracts.
Fox News has learned that Congress was unaware Johnny Chung had been told above all else, don,t say anything about Loral and Hughes.
Loral and Hughes are currently under investigation for illegally helping China improve its missile technology. Sources say China wanted to keep the companies out of the scandal in order to protect its business arrangements and ability to acquire U.S. technology.
Another former Clinton fund-raiser, Yah Lin "Charlie" Trie, has now also pleaded guilty and agreed to cooperate with Justice Department investigators. Sources say they have reason to suspect Trie also may have been involved with Loral and Hughes and their export relationship with China.
The Pentagon concluded two years ago that Loral and Hughes had harmed national security by helping China improve its missile technology, but the President kept letting the companies do business with China, signing waivers allowing the two companies to export their satellites.
A series of launch failures, followed by the companies, unauthorized aid to Chinese scientists investigating the rocket crashes, prompted a congressional investigation, which on Tuesday will release its findings on Chinese espionage.
While it has been expected for weeks that the report will say China stole nuclear, conventional and space-based weapons technology from the United States, Fox News has learned the report will also say that China has been passing those secrets on to rogue nations hostile to America, including Iran, Syria, North Korea, Libya and Pakistan.