Factory owners protect their investments
Hong Kong garment factory owners may have funded a controversial political mission in an effort to protect their Marianas Islands sweatshops, according to documents dealing with the activities of convicted American lobbyist Jack Abramoff.
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Abramoff built a highly profitable lobbying practice in Washington in the late 1990s networking Republican congressmen, administration officials and select clients, but veered over into bribery and deceit, touching off a scandal that has set off numerous criminal investigations and helped bring down Republican leader Tom DeLay. Abramoff pleaded guilty in January to charges of tax evasion, conspiracy to bribe public officials, and fraud related to the overbilling of Native American tribes for lobbying work and was sentenced to almost six years in prison in March in connection with another set of fraud and conspiracy charges.
Among Abramoff's biggest clients, in addition to the tribes, was the Northern Marianas, an island chain east of the Philippines controlled by the United States. Saipan, the main island in the chain, is home to a clutch of factories in which thousands of young women from China sew clothes at wages below the mainland US minimum. Under a "Made in USA" label, the clothing is then imported into the US mainland free of quotas and tariffs.
The Tan family from Hong Kong, which controls the listed Luen Thai Holdings, pioneered the industry by taking advantage of the islands' partial exemption from US labor, immigration and trade laws and built close ties with DeLay and other Washington politicians to win their help in protecting the Northern Marianas' status.
Democratic governor Froilan Tenorio took up the cause in 1994 by retaining Abramoff's firm, Preston Gates, as lobbyists. Despite running huge budget deficits, the islands' government paid Preston Gates more than US$1 million a year until Republican governor Pedro Tenorio, uncle of the previous governor, let the firm go in November 1998.
When the government stepped out, the private sector stepped back in. The Saipan Garment Manufacturers Association teamed with the Saipan Chamber of Commerce and two other local business groups to form the Western Pacific Economic Council, which in turn paid Preston Gates US$2.4 million in 1999 and 2000 for lobbying.
Abramoff saw a chance to restore official patronage after elections in November 1999 weakened the local Republican Party's hold on the legislature. Abramoff allies Edwin Buckham and Michael Scanlon traveled to Saipan the following month to meet with two Republican members of the local House of Representatives. Buckham and Scanlon promised to secure federal funding for projects in the legislators' districts if they would support former Tan employee Benigno Fitial, then a Republican, to be House Speaker. They agreed and allied with a group of Democrats in the House to install Fitial in place of the incumbent Republican Speaker.
Fitial then used his coalition in a successful drive to pressure the Tenorio administration to rehire Preston Gates. Funding for the projects in the two turncoat legislators' districts came through the following year.
The Los Angeles Times investigated the Buckham/Scanlon mission last year, but did not report on its funding.
However, files seen by Asia Sentinel that were recently released during hearings by the US Senate Indian Affairs Committee contain a copy of an email Abramoff sent Willie Tan, who oversees the families' interests in Saipan, on December 17, 1999 about paying for the trip.
"Per my previous email, the cost of Ed's and Mike's trip was as follows:
"Hotels (Saipan and Tinian) $4,879
"Mike loss of wages $3,250
"As I indicated, this should be wired to the National Center for Public Policy Research so they can pay it.... Please confirm to me when this has been sent so I can coordinate it on this side, which will be a bit tricky."
About the same time, Abramoff sent an email to center president Amy Ridenour, saying, "You will be getting a wire of approximately $25K, which I will discuss with you next week." A reply from Ridenour said, "I'll do what you want, of course."
The Senate Indian Affairs Committee's final report in June detailed other instances of Abramoff channeling payments through Ridenour's center, a conservative think tank, to obscure his role.
Though DeLay publicly embraced the Tan family early on, Abramoff has sometimes gone to brazen lengths to hide his involvement. After a January 1998 email he sent to Willie Tan and Fitial, then still a Tan employee, on strategic options for the then-government-funded lobbying effort was leaked to the press, Abramoff told ''We don't have a relationship with Tan and we never will."
At the time of the Saipan trip, Scanlon was in his final days as an aid to DeLay. He pled guilty last November to conspiring to bribe a member of the US Congress and other public officials.
Buckham, who was once DeLay's chief of staff, was at the time of the trip running his own lobbying firm, Alexander Strategy Group, and employing DeLay's wife. A recent investigation by the Washington Post found that various Tan companies paid US$650,000 to the US Family Network, a nonprofit group Buckham and his wife founded ostensibly to promote "family values," between 1997 and 2001.
The newspaper reported that the Buckhams paid themselves at least US$40,000 in commissions on the Tan donations. The Tans' contributions represented more than a fifth of the money collected by the Family Network; the Buckhams kept a third of the group's US$3.02 million in collections for themselves.