28 Apr 2000 April 28, 2000

David Chang, an international businessman, is one of the Democratic Party’s biggest donors. He visited with President Bill Clinton at the White House on several occasions and claims to have eaten pizza with the President in South Korea. On April 13, David Chang was placed under 24-hour house arrest for allegedly coercing a former employee to lie about the methods in which he made campaign contributions.

Chang is a target of the U.S. Department of Justice’s Campaign Financing Task Force. His house arrest stems from taped conversations made by federal investigators between fired Chang employee Chris Kim and Chang in which Kim was reportedly asked to lie to federal authorities about Chang’s alleged laundering of $80,000 in South Korea. At the time, Chang was free on $500,000 bail after being charged with making illegal campaign contributions to Senator Robert Torricelli (D-NJ) in 1996.

A letter from the Justice Department released in mid-April states the government has evidence that Chang "received and/or solicited" help from Senator Torricelli on four matters. These matters are helping to unfreeze Chang’s assets in North Korea, helping him purchase a South Korean insurance company, writing college recommendations for relatives and making introductions for him with foreign dignitaries.

Torricelli’s office admits to helping try to unfreeze Chang’s North Korean assets, but reports it was unsuccessful. Chang received bipartisan support in his attempt to buy the Korea Life Insurance Company as well as seeking Torricelli’s assistance, but that also failed. On a trip to South Korea last September during negotiations on the sale, Chang was accompanied by President Clinton’s chief fundraiser Terrence McAuliffe.

Regarding charges that Chang funneled $23,000 to Torricelli’s 1996 Senate campaign, three people have already pled guilty to the illegal activity and one has fled the country. Chang passed money to members of the Bergen County (NJ) Democratic Party leadership which then reimbursed others for their donations to the Torricelli campaign. Torricelli’s initial response was to speculate that every member of Congress gets donations from such "straw donors," and that "people have to learn to take these laws seriously." He denies knowledge of any illegal contributions.

Expected Republican presidential nominee George W. Bush said he would consider a ban on soft money campaign contributions if it was tied to a paycheck protection provision for union members. Soft money contributions that support "party-building" activities and do not directly support candidates are not regulated, but are the target of proponents of increased campaign regulation. Paycheck protection would allow union members to decide whether or not their dues could be used by union bosses to finance union political activity. Speaking on the soft money issue in Camden, South Carolina on December 17, Bush said, "If the Democratic opponent would say that he’s in favor of closing the loophole, the union loophole, then I’d seriously consider it if that’s what they meant."

Campaign Finance Factoids

Hollywood Trio to Cut Back on Political Fundraising

Cut! Democrats will need to tighten their belts now that the founders of Hollywood’s Dreamworks SKG studio – Steven Spielberg, Jeffrey Katzenberg and David Geffen – announced they will "take a break" from political fundraising in November. The wealthy trio made their own major personal donations to Democrats over the years as well as helped raise money for the party in the entertainment community. Most recently, they raised $2.8 million on April 15 in Beverly Hills.

New York Senate Race Gets National Attention, Expected to Be Biggest Ever

Campaign experts predict the New York Senate race between First Lady Hillary Rodham Clinton (D) and New York City Mayor Rudolph Giuliani (R) may top $100 million in total spending, making it the most expensive ever. The current record is $43.3 million in the 1994 California Senate race. While both candidates are getting support from outside the state, Clinton reported that the $1.39 million she raised between January and April of this year contained only $81,000 from New York residents.

Campaign Regulation Hurts African-American Political Action

"African-Americans and other minority groups will be greatly disadvantaged and subtly shut out of the political system of this great nation by [increased campaign finance regulation]… Why should African-Americans or any other minority group be restricted from addressing an issue’s impact on their community through advertisement or discussing a candidate’s position on issues for fear of presumed ‘coordination’ with a candidate?" – Letter from the Black America’s Political Action Committee to Senator Mitch McConnell (R-KY)