CBSN

Did Pair Funnel Money To Dems?

Thai businesswoman Pauline Kanchanalak and her sister-in-law were charged Monday with funneling foreign contributions to the Democratic National Committee and other U.S. political committees.

The 24-count indictment returned in U.S. District Court in Washington charged the pair with conspiring to impede the Federal Election Commission and cause false statements to be submitted to it.

Kanchanalak, 47, and her sister-in-law and business associate, Duangnet "Georgie" Kronenberg, 41, are the sixth and seventh people indicted by the Justice Department's campaign-finance task force.

According to the indictment, the pair used funds from foreign corporations and individuals including Pauline Kanchanalak herself and her husband, Jeb to make prohibited campaign contributions of at least $679,000 to the Democratic National Committee and other U.S. political committees.

The foreign-sourced money was funneled through the accounts of Georgie Kronenberg and Praitun Kanchanalak, Kronenberg's mother and Pauline's mother-in-law, because they hold green cards as permanent resident aliens and are legally entitled under federal election laws to make contributions to U.S. campaigns with their own funds, the indictment said.

Foreigners are barred from giving to U.S. campaigns and Pauline Kanchanalak, as a Thai citizen, cannot contribute to the nomination and election of candidates for political office in this country.

Praitun Kanchanalak and Jeb Kanchanalak were named as unindicted coconspirators in the indictment.

Attorney General Janet Reno, who has resisted Republican pressure and a recommendation from her FBI director Louis Freeh to turn the case over to an independent counsel, noted that the campaign finance task force has brought new charges against four defendants in six days. "This is our largest criminal investigation," Reno said.

Last week, the task force added income tax charges to earlier campaign finance charges against Democratic fund-raiser and immigration consultant Maria Hsia and obtained agreement from Miami businessman Howard Glicken to plead guilty to two misdemeanor charges of funneling foreign contributions illegal to Democrats.

Monday's indictment charged that through the straw donors Pauline Kanchanalak and Georgie Kronenberg gained access to President Clinton and various members of his administration. This access was intended to impress clients and help their business ventures, the indictment said.

The grand jury said the largest recipient of the illegal contributions was the Democratic National Committee, which received more than $333,000. Various state Democratic parties, including California, Florida, Illinois, Ohio, and Pennsylvania, also got money from the scheme, as did many Democratic candidates for federal and state office.

The pair were charged with 13 counts of causing false statements to be filed with the FEC, stemming from their arranging for contibutions to the DNC and various Democratic candidates in the name of legal contributors, when the money in fact came from non-green cardholders and foreign contributions.

By Michael J. Sniffen