Charles R. Smith is a noted investigative journalist. For over 20 years, Smith has covered areas of national security and information warfare. He frequently appears on national television for the Fox network and is a popular guest on radio shows all over America. More ↓Less ↑
In November, 1994, the late Ron Brown led a U.S. business trade
mission to Indonesia. Documentation on that mission, recently obtained
using the Freedom of Information Act, shows that Ron Brown was aware of
a crime in progress. Brown knew that Indonesian Dictator Suharto had cut
his son-in-law into a kick-back scheme, involving U.S. tax money. The
documents show that Brown was not only aware of Suharto’s corrupt
activities but quietly cooperated by seeking U.S. backed financial aid
for the project.
The document, titled “Indonesia Advocacy Projects” contains detailed
information on the privately held Indonesian Paiton Power Plant. The
power project involved the construction of two 600 million watt, coal
fired, plants to provide electricity for east Java.
The partners in the U.S.-led consortium included Mission Energy,
Mitsui & Co., Ltd. of Japan, General Electric Capital Corporation of the
U.S., and P.T. Batu Hitam Perkasa, an Indonesian firm formed in 1989 to
participate in the development of the country’s private power industry.
The leader of the U.S. project in the Paiton power plant, Mission
Energy, is also a partner of Indonesia’s Lippo group, a consortium part
owned by billionaire Mochtar Riady.
The November, 1994 Commerce Department advocacy document shows the
Indonesian Paiton project encountered difficulties with financing
because the Asian Development Bank (ADB) knew it also contained a
Suharto family kick-back. Suharto’s son-in-law, according to the U.S.
government advocacy document, was known to be a share holder in P.T.
“Ambassador Barry stated that the project is facing two problems,”
noted Commerce officials on the Paiton project status document dated,
November 1, 1994. “(i) the ADB financing may cave in and (ii) EXIM
financing. Regarding ADB, technical questions have been satisfied, but
ADB is skiddish about involvement of Indonesia’s first family (a
minority shareholder is married to Pres. Suharto’s daughter).”
Another part of the November 1, 1994 document accuses France of
bribing the Suharto government in the fierce trade war between the U.S.
and France over satellite launches for Indonesia. In 1994 the U.S. and
France were competing to orbit the Indonesian Palapa C TV satellite. The
Commerce document notes, “There are also allegations that the French
have paid ‘incentive money’ to the Indonesians, but this cannot be
Curiously, the Clinton administration quietly co-operated in the
power plant kick-back scheme instead of voicing opposition to pay-offs
to Suharto. The Commerce document shows that U.S. Ambassador Barry
worked directly with Executive Director of the Asian Development Bank,
Linda Yang, to obtain financial support despite the questions of
kick-backs to Suharto. In fact, the document states that Ms. Yang was
“doing all she can” to help Indonesia obtain the financing for Paiton.
In the end, the Suharto corruption quietly killed the ADB financing
and the Asian Development Bank refused to back the deal. However, Lippo
partner Mission Energy and the Suharto family successfully got the U.S.
Government to officially back the project. Thus in 1995, the Brown led
Commerce Department found financing for Paiton through the U.S.
In April, 1995, $1.82 billion in limited recourse project debt was
provided to Paiton by The Export-Import Bank of Japan, the Export-Import
Bank of the United States, the Overseas Private Investment Corporation
(“OPIC”) of the United States, and eight commercial banks.
Commerce documents show that Lippo business partner Mission
Energy (now named Edison Mission Energy) received strong Clinton
administration support for the Paiton project. One 1994
document, obtained by Larry Klayman of Judicial Watch, noted the
Indonesian government-backed project had “state-of-the-art
emissions-control technology… by using low-sulfur Indonesian
coal, the project will be one of the cleanest, most efficient
coal-fired facilities in the world.”
Please note the Paiton power plant was designed to burn
“low-sulfur Indonesian coal”. In 1996 President Clinton created
the 1.7 million-acre Grand Staircase-Escalante National
Monument in Utah, placing off-limits the world’s largest deposit
of low-sulfur coal. The Lippo group is the primary owner of the
only other supply of low-sulfur coal in the world, located in
Clinton’s move left the only remaining low-sulfur coal supply in
Lippo hands, creating a Riady monopoly. The move vastly increased the
dollar value of Riady’s low-sulfur coal reserves in a single stroke of
Clinton’s pen. The Indonesian coal reserves, co-incidentally, just
happen to be located close to the U.S. taxpayer backed Paiton power
The questionable parts of the Paiton project are not only centered
around coal from Riady. For example, Senator Tom Harkin has a close
connection. It just happens that Ruth Harkin, Sen. Harkin’s wife, was
also 1994 head of the U.S. Government’s Overseas Private Investment
Corporation (OPIC), a major Paiton financial backer. Ms. Harkin approved
the OPIC financing for Paiton in 1994.
Harkin, a former partner in the law firm Akin, Gump, Strauss, Hauer &
Feld, is a close Clinton friend. Harkin’s partnership in the powerful
D.C. based law firm also included other Clinton friends Robert Strauss
and Vernon Jordan.
Another major part of U.S. taxpayer financing for the Paiton project
was obtained through the EXPORT-IMPORT bank (EXIM). Several of the
Indonesian projects listed in the Commerce document note that EXIM head
Ken Brody worked closely with Brown on Indonesia financing. Ken Brody is
also a close friend of Treasury Secretary Robert Rubin. Rubin worked
with Brody during his years at the investment firm Goldman Sachs.
Furthermore, the EXIM bank under Brody financed over $4 billion
dollars worth of gas deals with another energy company, Enron. Enron is
also an Akim/Gump client. In fact, Enron executives traveled with Ron
Brown in 1994 on trade missions to Russia, Indonesia and China, cutting
EXIM and OPIC backed deals in each country. Enron is not only another
Akin/Gump client but it is listed as one of forty-four such companies in
which Rubin had “significant contact” with during his years at Goldman
In 1997 the Commerce Department was forced in court by Judicial Watch
to reveal that the Lippo Group successfully gained official U.S. support
for a power project in Fujian, China. The controlling partners in the
project included Mission Energy, Bechtel Enterprises and Lippo.
Handwritten notes and a Commerce e-mail revealed that Mission Energy
representatives met with Commerce officials to discuss the project and
that the Lippo Group specifically was mentioned. The
Lippo-Mission-Bechtel project also makes use of low-sulfur coal.
In August, 1994, the Ron Brown trade trip to China included support
for a third Lippo backed power project in China with the Arkansas-based
Entergy Corp., yet another large Clinton contributor. Former DNC
fund-raisers Ira Sockowitz and John Huang worked for Brown in 1994 at
the Commerce Department and were charged by Brown to “vet” or check out
the Entergy project in China.
“The signing of the MOU (memorandum of understanding),” notes the
Huang/Sockowitz vet document, “Demonstrates another level of agreement
with not only NCPG (North China Power Group) but Central Government
Approval through the Ministry of Power as well. Total Value $1 billion,
American Content $465,000,000 … Next steps include Central
government’s approval of the rate of return and manufacturing equipment
and project financing. Entergy has approached ExIm.”
Commerce documents show Edwin Lupenberger, the CEO of Entergy, flew
along with Secretary Brown and Maria Haley of the U.S. Export-Import
Bank to meet Madam Wu Yi, head of China’s Ministry of Foreign Trade and
Economic Cooperation. Lupenberger attended the trade mission to China on
the personal authority of President Clinton. Edwin Lupenberger also
personally donated over $60,000 to Democratic candidates prior to the
The connections between Riady and Clinton have a much more sinister
theme than coal monopolies and taxpayer backed power plants in the
middle of Asia. Testimony before Senator Thompson’s committee last year
revealed Moctar Riady’s involvement in Chinese espionage. Testimony
revealed the Lippo Group is in fact a joint venture of China Resources,
a trading and holding company “wholly owned” by the Chinese communist
government and used as a front for Chinese espionage operations.
Clinton’s corruption involves matters of grave national security and
economic survival. China Resources investments in Lippo expanded rapidly
during the Clinton administration, coinciding with illegal six-figure
Lippo contributions to his 1996 re-election. Many of those illegal
donations originated with former Lippo employee John Huang. Huang also
had direct access to President Clinton and a secret clearance. Huang was
briefed 37 times by the CIA on satellite encryption technology. Huang
has fled the U.S. and is now somewhere in Asia.
There is no question the Riady-sponsored corruption inside the
Clinton administration reached directly to the Oval office. The single
most telling piece of data is the video evidence of the Riady gardener
trying to hand Bill Clinton a check while uttering “James Riady sent
The recently discovered documentation also shows that corruption
extended beyond American shores to another country. Indonesian President
B.J. Habibie, hand picked successor to Suharto, is hoping that the
uproar in his country over the former dictator will pass. Indonesia
faces the worst political crisis in 30 years and there are growing
demands to put Suharto on trial.
The documentation from the late Ron Brown holds within it the fate of
two nations plagued by a common corruption. The fact that Brown sold the
trips to big DNC donors is all too evident. The threats to national
security are part of open testimony. The addition of bribery and
kick-backs with foreign officials are now available, written by the U.S.
Proof that crime knows no borders, no party affiliation and no