Undisclosed cash flowed at Trump inaugural ball with ties to China, embattled Saipan casino
By LULU RAMADAN | The Palm Beach Post | Published: April 13, 2019
PALM BEACH, Fla. (Tribune News Service) — In the decked-out ballroom of a ritzy Washington hotel the night before Donald Trump took office, thousands of dollars flowed from political donors and a questionable casino company to an undisclosed bank account.
The lavish Asian Pacific American Presidential Inaugural Gala – the first of its kind, with a buffet-style dinner, cocktail tables draped in white cloth and live entertainment – drew more than 900 people who paid at least $75 per ticket and a handful of sponsors who shelled out much more.
But there's no trace of the money raised that night, as required by law, The Palm Beach Post has found.
That includes donations by their biggest listed sponsors. Among them: an embattled Saipan-based casino later raided by the FBI, a Guam-based shipyard and a handful of Pacific Island hotel operators, all of which benefited from a foreign labor bill signed into law by Trump a year later.
Raising the political stakes further, one of the event's four chief organizers, onetime Trump campaign aide Jason Osborne, followed up the event by lobbying for the labor bill to help the Northern Mariana Islands, home to the Saipan casino.
One man in charge of raising money for the event told The Post that the host, the National Committee of Asian American Republicans, collected between $5,000 and $15,000 each from up to 20 listed sponsors. It also took in hundreds of smaller contributions.
As a registered political committee, such contributions must, by law, be reported to the Federal Election Commission. But none were.
The committee's executive director, Boca Raton tech entrepreneur Zhonggang "Cliff" Li, told The Post that he knows where the money went, "but I don't want to tell you."
"That almost sounds like an admission of a reporting violation," said Erin Chlopak, a former Federal Election Commission attorney. "Political committees have to disclose all of their receipts and disbursements. There's no 'I don't want to' exception."
Li has drawn international attention as an associate of Cindy Yang, the onetime head of fundraising for the committee that hosted the gala. Her access to Trump through his Mar-a-Lago estate in Palm Beach and involvement in groups linked to the Chinese Communist Party prompted top congressional Democrats to seek a federal investigation.
As the U.S. attorney for the Southern District of New York investigates allegations of financial abuse by the Trump inaugural committee, which raised a record $107 million, no public investigation has targeted the Asian American Republican inaugural ball, which has links to China and dubious donors but no financial records.
Political operatives often find creative ways to circumvent reporting requirements particularly for inaugural committees, said Chlopak, who now works for watchdog nonprofit Campaign Legal Center.
"This is one of the areas in which the dark money phenomenon is really clear," she said.
Some committees, including the Trump inaugural, set up nonprofits, which must be registered with the IRS. But in the case of the organizers of the Asian American gala, no nonprofit appears in federal records.
And the guests included several Chinese nationals, said Washington lobbyist Puneet Ahluwalia, who headed the fundraising subcommittee for the event. Foreign nationals are barred from donating to American political committees.
Without public receipts, there's no way to know who gave money and if any laws were broken.
Ahluwalia told The Post that checks were made out to the National Committee of Asian American Republicans. He said he reached out to potential donors to encourage sponsorship, as did several other organizers, but he didn't personally see or collect checks.
"I wasn't privy to who took the money or who wrote the checks," Ahluwalia said. "All of the money that was pledged by the big donors, by the tickets, had to go into some box. That box was the National Committee of Asian American Republicans."
The event and ticket-sale websites for the gala offer a clear legal disclaimer telling donors the committee must report, under federal election law, the name, address, occupation and employer of all those who give more than $200.
The disclaimer notes that "contributions to the National Committee of Asian American Republicans" are not tax deductible. It points out that contributions from foreign nationals are prohibited.
Chlopak said the disclaimer, though generically worded, "certainly suggests they are aware of their reporting obligations. And if they collected donations, they have to report them, which further raises the question of why they didn't do that."
"Sometimes there are inadvertent oversights, which isn't uncommon, but that doesn't seem to be the case here," Chlopak said. "Sometimes people don't want certain information exposed."
The group collected money, organizer Li said, but it didn't go to the registered committee.
When asked to explain, he wouldn't.
"The money went to the right account legally, but I just don't have to tell you where that is," Li told The Post.
Just two people were in charge of donations during the gala, Ahluwalia said: Li and Osborne, the Trump aide-turned-lobbyist.
Osborne, a senior adviser to the Trump campaign in 2016, is listed on the gala website as one of four people on the event's organizing committee.
Three months after the gala, Osborne, who did not respond to a phone call or email seeking comment, registered as a lobbyist for the Commonwealth of the Northern Mariana Islands, which includes Saipan, the Pacific island that U.S. Marines took during World War II and where the casino that backed the gala has grown to be among the most profitable in the world.
He lobbied for a bill, later signed by Trump, that opened avenues for several gala sponsors to employ Chinese and Filipino laborers for hotel and casino construction jobs.
One of those sponsors, Imperial Pacific International, at the time ran one of the most lucrative gaming operations in the world even before completing construction of a luxurious megacasino, Bloomberg Businessweek reported in February 2018. The volume of money generated by Imperial Pacific's small Saipan operation, nearly 6,000 miles from California, prompted several experts to suggest money laundering might be involved, Bloomberg reported.
Two months after the January 2017 inaugural gala, FBI agents raided Imperial Pacific offices in Saipan, Bloomberg reported. Federal prosecutors charged contractors employed by Imperial Pacific with hiring and harboring workers brought in illegally on tourist visas.
The probe started after several foreign workers were hurt and at least one was killed at the Imperial Pacific construction site in Saipan.
The law signed by Trump in July 2018 offered businesses an avenue to avoid illegally bringing in cheap foreign labor. Known as the Northern Mariana Workforce Act, it expanded the number of visa waivers Pacific Island businesses can request to employ foreign workers.
Imperial Pacific and at least four other hotel, casino or dock operators that sponsored the inaugural gala, media reports show, rely heavily on foreign labor to build projects in the remote Northern Mariana Islands and Guam, U.S. territories that are closer to Taiwan and mainland China than they are to the continental United States.
Imperial Pacific did not respond to emails requesting comment.
Other gala sponsors that also benefited from the labor law did not respond to requests for comment: Mathews Pothens, who owns the Guam-based shipyard; P.H.R. Ken Micronesia, a subsidiary of a Japanese real estate giant that has built hotels in Saipan and Guam; Jones & Guerrero Co., which has built hotels in Saipan; and Bridge Investment Group, which owns a hotel and casino in Saipan and properties in South Florida.
One company listed as a sponsor on the gala website, Triple J, an Australian government-financed radio station, said it had no involvement in the event. Alone among the listed sponsors, it had no Asian American ownership or base in the Pacific Islands.
Representatives from Triple J's parent company, Australian Broadcasting Corp., reached out to organizers after questions from The Post. Organizers removed the radio station's name and logo from the event website shortly afterward, but all other sponsors remain listed.
No other sponsors returned calls or emails requesting comment.
Lobbying firms for gala-organizer Osborne collected $390,000 in 2017 and 2018 from the Northern Mariana Islands government and the Northern Mariana Business Alliance to lobby for the legislation, federal lobbying records show.
A Trump campaign advisory board, the Asian Pacific American Advisory Committee, co-hosted the inaugural event. The board's two-dozen volunteer members, who campaigned for then-candidate Trump, organized the event but the board didn't register as a political committee and did not collect money.
From that board only Li was affiliated with the political committee that solicited donations for the gala, the National Committee of Asian American Republicans.
Li declined to say how much money was raised that night, or whether any donations went to him, the embattled Trump inaugural committee or any of the other two-dozen event organizers.
The National Committee of Asian American Republicans' treasurer, Timothy Koch, who owns a Washington-based political accounting firm, did not respond to a phone call. His firm was hired by the committee to manage its accounts, FEC records show.
Committees have 10 days to deposit contributions of $50 or more into a bank account. The month of the gala, tickets for which ranged from $75 to $200, the committee logged no contributions, federal records show.
Myles Martin, a spokesman for the FEC, confirmed that the National Committee of Asian American Republicans hadn't reported any contributions during the month of the gala or the month prior to it.
Political committees don't always need to log contributions on their own reports, Martin said.
Organizers could have collected cash on behalf of another committee, a practice known as "earmarking," Martin said. But that requires a disclaimer, which didn't appear on the inaugural gala's website, invitation or ticket-sales page.
It also could have acted as a conduit to another committee or even the Trump inaugural nonprofit, but that too requires thorough reporting.
"If they were collecting money on behalf of any committee, it should be accounted for," Martin said.
The penalty for failing to report contributions is usually a fine and depends on the amount of money collected.
Committees also face financial penalties for collecting money from foreign nationals.
The National Committee of Asian American Republicans did file reports with the Federal Election Commission, but none of the transactions include money collected from or spent on the gala.
The committee took in $37,295 between 2015 and 2018, records show. All of the donations came from individuals, many of whom are affiliated with the group.
Its spending went to lawyers, political accounting firms and credit card transaction fees. The reports include no donations to politicians.
There are no public receipts for money spent on the venue, the historic Mayflower Hotel just north of the White House, the food, or the entertainment, which included Asian dancers and a Korean American operaist who once performed at a South Korean presidential inauguration in 2014.
Li and his South Florida comrades are, all the while, facing media scrutiny for mingling with top Republicans, including Trump officials, while maintaining ties to China through groups controlled or influenced by the Chinese government.
Both Li and Yang, the spa owner-turned-political operative, have appeared at political events at Trump's Mar-a-Lago estate. They personally have donated a combined $45,000 to pro-Trump PACs, though neither of them voted in the 2016 general election.
The pair and at least seven other South Florida Chinese Americans with similar links to Beijing got involved in politics during former Florida Gov. Jeb Bush's 2016 campaign for president and eventually turned their sights to Trump, The Post reported. Experts say the behavior is characteristic of China's documented influence-peddling tactics.
They operated under the radar until Yang caught attention for once owning the day spa where New England Patriots owner and Trump confidante Robert Kraft is accused of soliciting a prostitute.
Both Li and Yang, speaking through her attorney, have denied acting on behalf of the Chinese government.
Unlike other events hosted or attended by the Asian American Republican group, including those at Mar-a-Lago that drew Trump family members and top Florida Republicans, the group didn't post photos of the inaugural gala online.
Few photos of the event are publicly available. The group Korean-Americans for Trump, which attended, shared pictures of the gala on Facebook, which show the balconies and ballroom of the Mayflower crowded with attendees.
Li described his political committee as a hard-working and honest effort to get politically involved. "We have no interest in money flowing into our account," he said.
Still riled by weeks of media scrutiny, Li called the questions regarding the inaugural ball and the group's ties to China "another attack on our community."
"I don't want to spend time on this topic," Li said. "And given how you've demonized our community, I don't want to talk to you."
Staff researcher Melanie Mena contributed to this report.
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