2 Democratic Fund-Raisers to Plead Guilty

Two Democratic fund-raisers with strong ties to the Los Angeles Asian American community have agreed to plead guilty to charges related to an elaborate scheme to make $50,000 in illegal political contributions and agreed to cooperate with federal prosecutors in a continuing investigation, the Justice Department said Wednesday.

In documents filed in federal district court here, Nora T. Lum, a frequent visitor to the White House, and her husband, Gene K.H. Lum, acknowledged that they had conspired to evade federal campaign laws. The donations were made to the 1994 campaigns of Sen. Edward M. Kennedy (D-Mass.) and to an unsuccessful Oklahoma congressional candidate.

The Lums arranged to illegally channel their own money and funds from their Oklahoma energy company through numerous “straw” contributors, according to court documents.

“Nora and Gene Lum accept full responsibility for their conduct and regret any harm they may have caused by their actions,” said their attorney, Cono R. Namorato. “They are hopeful that they can soon put these events behind them and get on with their lives.”

Federal investigators looking into questionable Democratic fund-raising practices have focused on the Lums, close friends of the late Commerce Secretary Ronald H. Brown, who previously served as chairman of the Democratic National Committee.

The Lums’ case is significant because it indicates the seriousness with which the special Justice Department task force is investigating allegations of fund-raising abuses. The Lums’ agreement to cooperate with prosecutors also could foreshadow indictments in other fund-raising cases.

The inquiry that led to the plea bargain started as part of an inquiry into the personal finances of Brown, who was killed in a 1996 plane crash. The Lums’ case is one of the first fund-raising cases to reach federal court.

After Brown’s death, some aspects of that investigation, including whether the Lums did favors for Brown or sought special treatment from the Commerce Department, were turned over to the Justice Department.

The charges against the Lums are “the first public fruits of the campaign finance task force,” acknowledged Bert Brandenburg, a spokesman for the Justice Department. The task force is conducting a wide-ranging investigation of fund-raising activities during the 1996 election.

Each of the Lums faces a penalty of up to five years in prison and a $250,000 fine. No court date has been set.

Federal law limits campaign contributions, prohibits donations from corporations and bars giving money in the name of another person. As part of their negotiated plea, the Lums admitted that they conspired to break the law and concealed their illegal activity from federal election authorities.

Trisha Lum, the Lums’ daughter and a former Commerce Department official, also has agreed to plead guilty to being an illegal conduit for a $10,000 contribution, made with money from her mother, to the Democratic Congressional Campaign Committee. She faces up to one year in prison and a $30,000 fine.

Court documents show that the conspiracy began in May 1994 and continued through April 1995. As part of the scheme, the Lums used funds from their company, Dynamic Energy, and from Nora Lum “to make substantial unlawful campaign contributions, totaling approximately $50,000, and concealed the true source of the contributions.”

The Lums provided their own or their company’s funds to “conduits” or “straw contributors,” who made campaign donations, and were reimbursed. The Lums also made some contributions in the names of others without their knowledge.

Some of the money went to the House campaign of Oklahoma Democrat Stuart Price. The Lums purchased Dynamic Energy with Price’s help in 1993. At one point, the couple put Brown’s son Michael on the company’s board.

“These are very serious charges. There is no justification for anyone to violate the campaign fund-raising laws,” Sen. Kennedy said in a prepared statement.

“Our campaign was not aware that any of these contributions were improper at the time that they were made. As we learned that questions were being raised about certain contributions, they were returned immediately,” Kennedy said.

Kathleen McKiernan, Kennedy’s press secretary, said that $19,000 has been returned to individuals associated with the Lums.

Beginning in 1992, the Lums were near the center of Democratic efforts to court big Asian American donors.

In 1992, they moved to California from Hawaii. To implement one part of that strategy, Brown was said to have installed Nora Lum as head of a Torrance-based organization known as the Asian Pacific Advisory Council--Vote. Operating out of a warehouse, the group sought to drum up support for the Clinton-Gore ticket in vote-rich California’s Asian American community.

One other member of the group was John Huang, a Democratic insider whose fund-raising is also under investigation.

Earlier this year, the Associated Press reported that Nora Lum made at least 13 visits to the White House beginning in March 1993. The White House previously has said that the visits were sparked by the administration’s interest in boosting the number of Asian Americans in government jobs.

On Wednesday, White House Press Secretary Mike McCurry first directed questions about the Lums to the Justice Department.

Under questioning, the spokesman said that he assumes the president knows the couple “because they have at various times been prominent in the party. But they have been associated with the fund-raising for others in the party, others in other states.”

Times researcher Anna Virtue contributed to this story.