Key player in Biden documents removal was caught up in Bill Clinton-era China-gate scandal

The custodian of the Joe Biden vice presidential records, a key witness in his classified documents probe, was caught up in another documents scandal while working at the Commerce Department during the Clinton administration, court records reveal.

Paul Sperry
RealClearInvestigations
Wed, 30 Aug 2023

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Friendship Archway in Chinatown Washington DC where BIden aide Kathy Chung in 2017 transferred boxes with top-secret material and figured in the Chinagate fundraising investigation of the 1990s.

Longtime Biden aide and gatekeeper Kathy S. Chung, who has been interviewed by federal prosecutors and congressional investigators in the Biden case, was part of a team sanctioned for withholding and even destroying key documents in the federal case that sought sensitive records from a central figure in the so-called Chinagate fundraising investigation of the late 1990s, RealClearInvestigations has learned exclusively.

A special prosecutor is now investigating whether Biden unlawfully handled top secret materials in early 2017, when he tasked Chung with removing boxes containing classified documents from the White House and storing them at various private offices in D.C., including the Chinatown neighborhood. Some of the highly sensitive papers also ended up at his home in Wilmington, Delaware.

Noting that Chung came into Biden’s orbit through working with the president’s son, Hunter, during the 1990s, congressional investigators want to know if the Biden family dealings in China have anything to do with the stockpiling of classified documents. They note that the mishandling of White House papers took place during the 14-month period in 2017-2018 when the Chinese were wiring almost $6 million in payments to Hunter and his uncle Jimmy Biden without providing any known legitimate services. They have expressed concern that the payments, which were flagged by the U.S. Treasury Department, were part of a Chinese intelligence-gathering operation.

Chung is central to the Justice Department’s investigation of Biden’s breach of classified documents.

On Jan. 4, federal agents interviewed Chung while working with an investigative team led by U.S. Attorney John Lausch, who was tasked to conduct a preliminary probe of the security breach. Alarmed by what his investigators reported back to him about Chung’s role in the possible illegal removal and retention of state secrets, Lausch urged Attorney General Merrick Garland to appoint a special counsel. The following day Garland complied, naming veteran federal prosecutor Robert K. Hur to take over the criminal case as special counsel. Hur’s office reportedly has obtained more than 100 pages of documents from Chung, including emails and text messages.

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Robert Hur, special counsel, obtained over 100 pages of documents from Kathy Chung
John Huang pleaded guilty to felony violation of campaign finance laws for arranging illegal foreign donations

While Donald Trump and Mike Pence are also under investigation for removing classified documents from the White House and storing them at their private residences, GOP congressional investigators say comparisons to Trump and Pence miss the point. In interviews with RCI, they insisted that Biden’s document scandal is potentially more serious than just mishandling state secrets. They suspect it could mushroom into a counterespionage case involving China and national security, though the White House dismisses such speculation as “baseless.”

Chung’s lawyer Bill Taylor did not return a request for comment. But in an earlier statement, he scolded Republicans for “suggesting someone is a traitor without any evidence.”

Chung’s dual role – as an aide to Joe Biden when he was vice president and a friend of Hunter Biden, who emails show received sensitive information from Chung from his father’s office – further highlights the murky ethics that exist between the Biden family’s public service and business interests.

Hunter Biden and Chung have a long history dating back to their days working together at the Commerce Department during Bill Clinton’s presidency. It was there that Chung – a longtime Democrat working in the federal bureaucracy – became a witness in a case involving convicted Chinagate fundraiser Jian-Nan “John” Huang, who was a top Commerce official.

In 1993, President Clinton named Huang, a China-born banker friend from Little Rock, deputy assistant secretary of international economic affairs at Commerce, where he was responsible for Asian trade matters. Within a month, Huang was given a top secret security clearance and received twice-weekly intelligence briefings by CIA analysts. At the same time, it was later revealed, he was meeting regularly with Chinese diplomats and other officials tied to Beijing.

Watchdog group Judicial Watch sought documents concerning Huang’s access to trade secrets and his trips to China. Chung was one of the administrators responsible for producing such documents under the Freedom of Information Act.

But the department was sanctioned for withholding and even destroying key documents in the federal case ‒ Judicial Watch Inc. v. U.S. Department of Commerce, et al ‒ in which Huang was listed as the lead defendant. After U.S. District Judge Royce Lamberth ruled Commerce’s search “grossly inadequate” and “unlawful,” Chung and her superiors were ordered to conduct another search. Still, Chung came up short in producing Huang-related documents from the computer of her boss, Melissa Moss, in the Office of Business Liaison, according to her sworn declaration in the case, a copy of which was obtained by RCI. A Clinton appointee like Hunter Biden, Moss worked with Huang on controversial Asian and other foreign trade junkets for Democrat donors. She came to Commerce from the Democratic National Committee, where she had served as finance director.

“In performing this search, I was assisted by an employee of the Computer Help Desk who informed me that some documents could not be opened,” Chung told the court in the 1999 affidavit, which was never uploaded to PACER, the electronic federal court records system. (After several requests to the court, Leayrohn King, a records clerk for the U.S. District Court for D.C., provided RCI a copy of Chung’s declaration and commented that it was odd that it was missing from PACER. The court has since made it available in the online docket system.)

Chung, who now works as a top aide to Defense Secretary Lloyd Austin, was not directly accused of wrongdoing. But lawyers for Judicial Watch complained her department was covering up for Huang, whom they suspected was trading government secrets and access to China.

While Chung remained at the Commerce Department, Huang left to work for the Clinton reelection effort. He raised almost $3 million for the DNC and Clinton in 1996, half of which was later found illegal or improper and returned because the donations came from foreign sources, many of them tied to Beijing.

The Justice Department, through a specially appointed task force, investigated Huang as a possible “agent of influence” for China. In 1999, Huang pleaded guilty to a felony violation of campaign finance laws for arranging illegal foreign donations. Even though the felony charge carries a maximum penalty of five years in prison, he was sentenced to one year of probation and agreed to cooperate with prosecutors in their investigation of several co-conspirators.

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Then VP Joe Biden, granddaughter Finnegan, Hunter Biden • Visit to Beijing, China

After Hunter Biden left the Commerce Department in 2001, where he served as executive director of e-commerce policy, he joined a K Street law firm founded by William Oldaker, a major political donor of his father. Records obtained by RCI show lawyers for Oldaker, Biden & Belair LLP represented another boss of Chung at the Commerce Department in the ongoing FOIA case, which wasn’t settled until 2004.

A decade later, Hunter recommended his father hire Chung as his personal assistant in the Office of Vice President, according to emails found on his abandoned laptop. Starting in July 2012, Chung was responsible for overseeing then-Vice President Biden’s office affairs, including handling his briefing books and scheduling his travel abroad. She handled the details for Hunter Biden’s controversial 2013 trip to Beijing with the vice president, during which Hunter met with Chinese investment partners and arranged for his father to shake one of their hands. Emails show Chung also invited Hunter to attend a 2015 lunch with Chinese President Xi Jinping at the State Department.

In January 2017, as Biden moved out of the White House, Chung helped pack 13 boxes with files from his office cabinets and store them at a transition office nearby, according to a partial transcript of Chung’s recent deposition taken behind closed doors at the Capitol. Around July 2017, Chung reloaded the boxes in her car and moved them to a private office that she leased in the Chinatown neighborhood of Washington, before they ended up early the next year at the China-funded Penn Biden Center in D.C., according to the transcript.

The boxes turned out to contain dozens of highly classified documents, including ones so secret they could only be viewed in a Sensitive Compartment Information Facility, or SCIF.Yet they were found last year in an unlocked storage room at the center that required no key to access. (The White House initially claimed, falsely, they were stored in a “locked closet.”) Prosecutors are investigating the chain of custody of those loosely stored intelligence papers to determine whether any were copied or passed through foreign hands.

Chung, who held a Top Secret security clearance and had experience handling and identifying classified documents, told congressional investigators she was unaware the boxes contained classified material – even though some of the file folders in the boxes were emblazoned with cover sheets stating they contained secret government documents. She insisted she never noticed any classified papers or saw any classified markings, even though she unpacked the boxes when she relocated them to the center and then re-packed them last summer at the request of Biden’s lawyers.

At least 20 highly classified papers marked at the Top Secret/Sensitive Compartmented Information level were found at the center, which the FBI searched earlier this year. The materials reportedly covered Ukraine, Iran, and the United Kingdom, among other foreign countries.

Chung helped Biden research his 2017 memoir, “Promise Me, Dad.” It’s not known if Biden or Chung referenced any of the materials from the boxes for his book, which was published in November 2017 and revealed insider accounts of Biden’s various roles in U.S. foreign policy, including Ukraine. Biden listed Chung first among people he acknowledged for their contributions: “Thank you for all of this, and more, to Kathy Chung.”

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House GOP depiction of the alleged China-to-Bidens money trail.
Ye, left, gifted Hunter an $80,000 diamond.Overlapping Scandals?

Hunter first made contact with Chinese executives with CEFC China Energy, a suspected front for Chinese intelligence, in 2015. Emails found on Hunter’s abandoned laptop show a CEFC adviser arranged a private Washington dinner in December 2015 with Hunter and then-CEFC Chairman Ye Jianming, who reportedly has ties to the Chinese military.

In an email Chung sent to Hunter Biden that same year, she included a list of personal cell phone numbers for high-profile Washington officials, including then-White House chief of staff Denis McDonough, then-Attorney General Loretta Lynch, and several Cabinet secretaries, as well as Bill Clinton, Hillary Clinton, and a number of powerful senators and members of Congress.

House Oversight Committee Chairman James Comer speculated that Hunter may have been trying to “prove his worth to these people that were paying these enormous sums of money to him,” in part by “showing them he had cell numbers for powerful individuals.”

Chung continued her dealings with Hunter Biden after she left the White House. On Feb. 2, 2017, shortly after Chung packed up Biden’s White House files, Hunter emailed Chung to ask her to “come work with me … so that I can make everyone money.” The next year, messages found on Hunter’s laptop show Chung sent Biden family members a link to an encrypted messaging app called Signal and urged them to install it on their electronic devices.

Later in February 2017, Hunter received an $80,000 diamond from Ye, who left the rare gem with a thank-you note at Hunter’s hotel room after they met in Miami. In an interview with The New Yorker magazine, Hunter admitted taking the expensive stone, though he says he doubts it was meant as a bribe.

Comer said he is investigating whether the Bidens’ Chinese partners “had access to the classified documents found.” He noted that Hunter Biden, in 2017, planned to share office space in D.C. with another one of his Chinese partners, Gongwen “Kevin” Dong, who was the CEFC money man who signed off on the wire payments to the Bidens.

“This level of access and opportunity raises questions about who had access to the classified documents,” Comer said.

In November 2017, another Biden partner from China ‒ CEFC’s Patrick Ho ‒ was arrested by FBI agents on charges of bribery and money laundering. According to federal documents obtained by RCI, the FBI raided CEFC’s D.C.-area offices shortly after Ho’s arrest and searched them for evidence. The FBI had been “electronically monitoring” Ho as a suspected Chinese spy under a Foreign Intelligence Surveillance Act wiretap warrant, the documents further reveal.

Within months of learning his Chinese partner had been arrested, property records show Hunter terminated the lease on his own D.C. office and closed the facility, where he’d made keys for both Dong and his father, Joe Biden, according to emails found on his abandoned laptop. That same month – February 2018 – the former vice president opened a D.C. office for the China-funded Penn Biden Center, where Hunter maintained access.

It’s not known if any White House records were stored at Hunter’s Georgetown office or transferred from there to the Penn Biden Center about four miles away. The center is hosted by the University of Pennsylvania, which has received several million dollars from anonymous Chinese sources since opening the center. But Hunter’s arrangement with his Chinese benefactors clearly raised counterintelligence alarms at the FBI, which began monitoring their communications. For whatever reason, the Bidens were never prosecuted as unregistered foreign agents and their own offices were never raided. Biden’s unauthorized removal and storage of classified intelligence went unnoticed – until after the 2022 congressional elections.

Chung, who worked on Biden’s 2020 campaign, was grilled on Capitol Hill about her access to and handling of classified information in April. She gave sworn testimony to the House Oversight Committee for roughly four hours behind closed doors.

Comer suggested earlier this year in a Fox News interview that his investigators were looking into possible ties between Chung and the Chinese Communist Party. Fox host Maria Bartiromo asked if Chung was “reporting back to the CCP about any of” the former vice president’s documents, and Comer replied, “We’re looking into that.”

Added Comer, “We’re looking into at least three different people that Hunter Biden was directly involved with that have very close ties to the Chinese Communist Party.”

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Democrat Rep. Jamie Raskin, left, accuses Comer, right, of falsehoods
based on a “bigoted conspiracy theory.”Ties to Chinese Communists

Comer noted that when Chung was in the White House, she fed Hunter Biden sensitive information on U.S. political leaders that he said Beijing would covet. In her April 4 interview with House Oversight investigators, Chung denied having a relationship with the CCP, according to excerpts of her testimony released by Democrats earlier this month.

Chung also insisted she never shared classified information with anyone who wasn’t cleared to read it, which ostensibly would include Hunter Biden. Rep. Jamie Raskin, the ranking Democrat on the Oversight panel, said Comer was spreading falsehoods based on a “bigoted conspiracy theory.”

House investigators want to know what the Chinese got for the massive payments they wired to President Biden’s son, brother, and several other family members. Were they using their contacts with the Bidens to gather U.S. intelligence? Were any White House records stored at Hunter’s Georgetown office, where his Chinese partners had access?

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Tony Bobulinski, associate of Hunter Biden
Chinese were partnering with the Bidens not just for money but “as a political or influence investment.”
Ben Schreckinger, Biden book author
“It would be reasonable to suspect that Ye and his associates intended to use their contacts with Jim and Hunter to gather intelligence” about critical foreign countries.”

In a recent letter to Hunter Biden, Comer requested, under threat of subpoena, that the president’s son provide any documents in his possession designated “classified” government property, along with any communications with Dong, Ho, Ye, and other CEFC officials. Separately, he has asked the University of Pennsylvania for a list of people who had keycard access to the Penn Biden Center. He also requested administrators turn over the visitor logs for the center.

“It is imperative to understand whether any Biden family members or associates gained access to the classified documents while stored at the Penn Biden Center,” Comer said.

According to emails found on Hunter’s laptop, Joe Biden was a silent partner in the CEFC deal that netted his son and brother millions. The documents show Hunter claiming that 10% of the Chinese payments were set aside for “the big guy.” Former partner Tony Bobulinski has confirmed that “the big guy” was Joe Biden.

CEFC is the capitalist arm of Chinese President Xi’s “Belt and Road Initiative” to spread China’s influence around the world while gobbling up oil and gas rights. China has sought to influence powerful officials, particularly to gain access to U.S. energy markets, which are heavily regulated.

Among the classified documents Biden reportedly had removed from the West Wing are sensitive compartmented briefings about Iran, where Beijing has been injecting billions of dollars in direct foreign investment to extract cheap oil.

“It would be reasonable to suspect that Ye and his associates intended to use their contacts with Jim [Biden] and Hunter to gather intelligence” about such critical foreign countries, said Ben Schreckinger, author of The Bidens: Inside the First Family’s Fifty-Year Rise to Power.

Bobulinski says the Chinese weren’t looking to make a “healthy” return on investment, but rather were partnering with the Bidens “as a political or influence investment.” He noted the CEFC partners were Chinese intelligence and understood the value of the Biden name.

In a May 2017 email, Jimmy Biden provided Hunter, Bobulinski, and other partners a list of friendly American political contacts whom they could exploit to advance the proposed joint venture with their Chinese partners. Among the “key domestic contacts” were Democratic Sen. Chuck Schumerof New York; then-Democratic New YorkGov. Andrew Cuomo;former Democratic Virginia Gov. Terry McAuliffe;and then-Democratic Sen. Kamala Harris of California, who would go on to become Biden’s vice president.

Republicans have slammed Biden for being soft on China. When Beijing flew a giant spy balloon across the continental U.S. and collected highly sensitive data from U.S. military sites, Biden did not order Defense Secretary Austin to shoot down the spycraft for several days, and only after public outcry.

In July 2021, Biden named his trusted aide Chung a top assistant to Austin, where she has access to sensitive Pentagon information. The Pentagon and White House declined to answer questions about the level of Chung’s access to classified military intelligence and the extent of her role in handling such material.

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