[Congressional Record Volume 142, Number 67 (Tuesday, May 14, 1996)]
[Extensions of Remarks]
[Pages E796-E797]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                        INDIAN ELECTION-RIGGING

                                 ______


                            HON. DAN BURTON

                               of indiana

                    in the house of representatives

                         Tuesday, May 14, 1996

  Mr. BURTON of Indiana. Mr. Speaker, I recently had the opportunity to 
meet with several prominent Kashmiri leaders to discuss the Indian 
Government's intentions to force elections upon the people of Indian-
occupied Kashmir on May 23 and May 30, 1996. While I was not surprised 
to hear that Indian security forces are continuing to commit numerous 
human rights abuses against innocent Kashmiris, I was astonished to 
learn of how far the Indian Government is going to deceive the outside 
world into believing that Kashmiris actually support the upcoming 
elections.
  I have been informed that the Indian Army is going door to door 
telling Kashmiris that they were legally bound to participate in the 
election and threatening physical retaliation against Kashmiris who 
fail to vote. Buses are being diverted from their normal routes to 
transport people to rallies supposedly in favor of elections. I have 
also been told that the Indian Government has organized 50,000 people 
to pose as Kashmiris and to travel throughout Kashmir on election day 
casting votes at every stop all under the watchful eyes and cameras of 
a select few reporters chosen by India to paint the elections as a 
great success.
  Mr. Speaker, it is quite well known by everyone who follows the 
Kashmir issue that the only vote people of Indian-occupied Kashmir 
desire is a vote which includes the option of independence from India. 
This option, while promised on numerous occasions by the United 
Nations, has been continually denied by the brutal Government of India. 
Why is self-determination deemed an inalienable right for so many 
peoples of the world, yet so taboo when talk turns to Kashmir? Are the 
peoples of Estonia, Latvia, Lithuania, Ukraine, Turkmenistan, 
Tajikistan, Armenia, and Azerbaijan more capable or worthy of self-
government than the people of Kashmir? Historically, Kashmir has been 
ruled as a princely state far longer than it has been part of India--a 
country which has existed less than 50 years. Its claims to 
independence are just as strong as those of the former Republics of the 
Soviet Union.

  Mr. Speaker, I have heard some political theorists argue that 
granting the Kashmiris their independence would prove destabilizing to 
South Asia and could facilitate the breakup of India. Hogwash! What 
could be more stabilizing for India than to give the Kashmiris, who 
clearly do not want Indian rule, their freedom. No longer would India 
have to devote hundreds of thousands of troops and huge amounts of 
money to suppressing the Kashmiris. Even if the transition to 
independence proved turbulent, would it be any more turbulent than the 
transition of the former Soviet Republics to New Independent States? Is 
avoiding potential instability a higher goal than freeing people from 
an oppressive ruler?
  Mr. Speaker, I hope everyone in the United States will be watching 
the upcoming elections in Kashmir very carefully. It is obvious that 
the Indian Government wants the world to stop asking these tough 
questions and wants the world's eyes to turn away from this troubled 
part of the world. That is why the Indian Government is going to such 
extremes to stage these elections. However, this should not come as a 
surprise to anyone who has had an opportunity to see what India is 
willing to do here in the United States to shield itself from United 
States congressional scrutiny. I encourage all my colleagues in the 
Congress to read the Thursday, May 9, 1996, Baltimore Sun article which 
documents how the Indian Embassy recently funneled $46,000 in illegal 
campaign contributions to United States congressional candidates whom 
it perceived to be sympathetic to India. Such tampering in United 
States electoral politics by the Indian Embassy cannot be tolerated.

                 [From the Baltimore Sun, May 9, 1996]

                   Campaign Fund-Raiser Admits Guilt

                   (By Jim Hanker and Mark Matthews)

       A prominent fund-raiser for Maryland Democrats pleaded 
     guilty yesterday to election fraud in a scheme to launder at 
     least $46,000 in illegal campaign contributions he received 
     from an official at the embassy of India in 1994.
       Lalit H. Gadhia--a 57-year-old immigration lawyer and 
     former campaign treasurer to Gov. Parris N. Glendening--
     confessed in U.S. District Court in Baltimore to his role in 
     the scheme to influence congressional lawmakers involved in 
     foreign-policy decisions affecting India.
       An immigrant from Bombay, India, who was active in 
     Baltimore's early civil rights movement, Gadhia now faces up 
     to five years in prison and $250,000 in fines. Sentencing is 
     scheduled for this summer.
       Prosecutors say the case against Gadhia is one of only a 
     handful of cases in which foreign citizens or governments 
     have been linked to illegal campaign contributions in a U.S. 
     political race, and may be the first time an official of a 
     foreign embassy has been implicated.
       ``The fact that the money came from the Indian Embassy and 
     that so many people were manipulated into participating in 
     the scheme takes this case to a higher level than we normally 
     see in these kind of investigations,'' said U.S. Attorney 
     Lynn A. Battaglia. ``Obviously, we have not seen a case like 
     this in Baltimore before.''
       Among those who received the illegal funds were four 
     members of the Maryland delegation and congressmen in 
     Pennsylvania, New York and Ohio. According to documents filed 
     in the case, federal authorities could find no evidence that 
     any of the recipients was aware of the true source of the 
     contributions.
       ``The campaign assumed that these were appropriate 
     contributions,'' said Jesse Jacobs, press secretary for Sen. 
     Paul S. Sarbanes, the Marylander who is the third-ranking 
     Democrat on the Foreign Relations Committee. Mr. Sarbanes 
     received $4,500 of the questionable contributions.
       Other Maryland Democrats who received $3,000 contributions 
     each were Reps. Benjamin L. Cardin and Steny H. Hoyer and 
     former Rep. Kweisi Mfume.
       In all, 19 Democratic candidates nationwide got the money 
     shortly before the 1994 elections through a network of 
     prominent Indian-American businessmen in Maryland, their 
     families and employees of their companies. The donors then 
     were reimbursed by Gadhia, who admitted yesterday that he 
     used money from a minister at the Embassy of India in 
     Washington.
       Under Foreign Election Commission rules, it is illegal for 
     noncitizens to make political contributions or for anyone to 
     make donations in another person's name. But Gadhia never 
     informed donors that the money was coming from India--or told 
     them that it was a crime to accept reimbursement for a 
     donation.
       ``The vast majority of people in the Indian-American 
     community nationally are going to be appalled by this,'' said 
     Subodh Chandra, 28, a Los Angeles lawyer who heads a 
     political action committee that unwittingly received at least 
     $31,400 of the illegal contributions from Gadhia.
       ``We can only hope at this point that these were the acts 
     of a lone bumbler or group of bumblers and not some sort of 
     international intrigue involving the Indian government. 
     Whatever the case may be, it has harmed an immigrant 
     community in this country that has worked hard for 
     political recognition,'' Chandra said.
       The scheme first came to light last year after a two-month 
     investigation by The Sun into Chandra's PAC, the Indian-
     American Leadership Investment Fund. Federal campaign finance 
     records showed that almost all of the group's money came from 
     Baltimore donors with ties to Gadhia, who then was 
     Glendening's campaign treasurer.
       Donating mostly in $1,000 and $500 increments, contributors 
     ranged from prominent Indian-American engineers and doctors 
     to cooks, busboys, students and secretaries who never before 
     had made a political donation.
       A half-dozen contributors interviewed said they were paid 
     by Gadhia or his nephew to write the checks, but had no idea 
     the practice was illegal.

[[Page E797]]

       Satish Bahl, a part owner of the Akbar Restaurant on 
     Charles Street--where kitchen employees made $13,500 in bogus 
     contributions--echoed other Baltimore donors in saying he now 
     feels badly used by his former friend.
       ``I had no idea--absolutely no idea,'' he said yesterday. 
     ``We were not aware of the consequences. We were only 
     involved thirdhand. We never thought about how far this could 
     go.''
       Gadhia denied the allegations at the time of The Sun's 
     investigation. But the case against him continued to build 
     last summer as FBI agents issued subpoenas to those who gave 
     to the PAC or who attended fund-raisers held by Gadhia for 
     Maryland congressional candidates, Baltimore Mayor Kurt L. 
     Schmoke and presidential aspirants Bill Clinton and Michael 
     S. Dukakis.


                           former md official

       Gadhia was at the height of his political influence, having 
     been rewarded by Glendening with an $80,000-a-year post as 
     his deputy secretary of international economic development. 
     Within days, the governor demanded his resignation.
       The allegations of wrongdoing stunned Baltimore's close-
     knit Indian-American community because Gadhia was its de 
     facto political leader--the man with the golden Rolodex who 
     could produce thousands of dollars in contributions with a 
     round of telephone calls.
       Then, on May 8, 1995, FBI agents seized documents from 
     Gadhia's Charles Street office that quickly expanded the 
     investigation beyond the PAC contributions.
       According to records released yesterday by the U.S. 
     attorney's office in Baltimore, the courier bill was 
     addressed to a minister named Devendra Singh at the ``Embassy 
     of India'' and it contained checks not only to the PAC but to 
     12 Democratic lawmakers.
       The records enabled the FBI to trace some $46,000 in 
     illegal contributions back to Singh at the embassy, Battaglia 
     said.
       Singh, who now is a high-ranking police official in 
     Rajasthan state in India, was minister for personnel and 
     community affairs at the embassy at the time. Among his 
     duties was to reach out to prominent Americans who had 
     immigrated from India and seek their support for the 
     government.


                          no such contribution

       The current minister for community affairs, Wajahat 
     Habibullah, denied that the embassy is involved in trying to 
     influence U.S. foreign policy through campaign contributions.
       ``I have not made any such contribution,'' he said, adding 
     that diplomats at the embassy have a budget for entertaining 
     dignitaries but not for political donations. ``Certainly it 
     is not part of our work.''
       But it is not the first time the issue has come up.
       India's current ambassador has been in Washington only 
     since April. But his predecessor, Siddhartha Ray, who is now 
     running for Parliament in India, drew harsh criticism from 
     Indiana Republican Rep. Dan Burton for his statements backing 
     certain members of Congress who were known to be strong 
     supporters of India.
       ``We are very concerned about political activities at the 
     Indian Embassy,'' Burton's chief of staff, Kevin Binger, said 
     of the Gadhia guilty plea. ``We feel very strongly that it 
     should stay out of political races. Any allegation that this 
     is going on should be investigated and made an issue with the 
     Indian government.''
       Said embassy spokesman Shiv Mukherjee: ``The Indian Embassy 
     operates fully within the bounds of diplomatic propriety.''
       Officially, the State Department had no comment. Privately, 
     however, officials chalked up the illegal contributions that 
     were funneled through Gadhia's Maryland political network to 
     a lack of sophistication in how to influence the American 
     political system.
       One official said the Indians had made a fumbling start in 
     their attempt to copy the formidable clout wielded on Capitol 
     Hill by such countries as Greece and Israel, which are 
     aligned with powerful and well-financed Washington lobbies.
       India and its supporters in Washington have been extremely 
     vocal in trying to limit U.S. military assistance to India's 
     longtime adversary, Pakistan--most recently, the sale of 38 
     F-16 fighters.
       As the Clinton administration has tried to improve trade 
     and political ties with India while not damaging relations 
     with Pakistan, much of this debate has played itself out 
     before the Senate Foreign Relations Committee and House 
     International Relations Committee.
       Federal Election Commission records show that the committee 
     members have become magnets for campaign contributions from 
     Pakistani and Indian immigrants living in the United States--
     and for Gadhia's laundered contributions.
       In addition to Sarbanes, other Democratic committee members 
     targeted were Sen. Charles S. Robb of Virginia, $2,000; Rep. 
     Gary L. Ackerman of New York, $3,000; Rep. Sherrod Brown of 
     Ohio, $3,000; Rep. Lee H. Hamilton of Indiana, $3,000; Rep 
     Eliot L. Engel of New York, $3,000; Robert E. Andrews of New 
     Jersey, $3,000; and Rep. Howard L. Berman of California, 
     $2,800.
       State Department officials said yesterday's revelations 
     were unlikely to do serious damage to U.S.-Indian relations. 
     Nor does the Gadhia case appear to rise to the level of other 
     campaign financing scandals involving foreign nationals.
       The Justice Department is investigating the campaign 
     finances of Rep. Kim, a California Republican and the first 
     Korean-American member of Congress.
       Since December, four Korean companies--Hyundai Motor 
     America, Korean Air Lines, Daewoo International (America) 
     Corp. and Samsung America--have paid a total of $1.2 million 
     in fines in connection with illegal campaign contributions to 
     Kim that were laundered through company employees.
       In 1994, a number of Japanese citizens and corporations 
     paid a $162,225 civil penalty to the FEC for making more than 
     $300,000 in illegal contributions in Hawaii during the 1980s.
       Perhaps the most famous episode of foreign intervention in 
     recent history was the Korean scandal of the 1970s, in which 
     a wealthy South Korean businessman funneled hundreds of 
     thousands of dollars in bribes and contributions to U.S. 
     politicians.
       Among those caught in the scandal, which implicated more 
     than 30 members of Congress, was Hancho C. Kim, a Maryland 
     businessman. He was sentenced to six years in prison in 1978 
     for accepting $600,000 in funds from the Korean government to 
     influence members of Congress.
                                                                    ____


                          How the Money Moved

       Aug. 16, 1993. Indian American Leadership Investment Fund 
     registers as a political action committee (PAC) with the 
     Federal Election Commission. In first 13 months, it raises 
     $700.
       October 1994. Lalit H. Gadhia sends 41 checks totaling 
     $34,900 written by various individuals to the PAC. Between 
     Oct. 30 and Nov. 3 the PAC sends $34,800 to 14 congressional 
     candidates and to the Massachusetts. Democratic Party's 
     Victory '94 fund. Federal prosecutors say that Gadhia 
     selected the candidates to receive contributions and that he 
     reimbursed the authors of most of the checks, using money 
     obtained from an official at the Indian Embassy in 
     Washington.
       October-November 1994. Another $16,000 in contributions 
     from individuals is made directly to 12 candidates, including 
     eight who also received money from the PAC. The contributors 
     are reimbursed by Gadhia, using money from the Indian Embassy 
     official.
       Dec. 1, 1994: Gadhia sends a report on the use of the 
     campaign funds to the embassy official, Devendra Singh.
       May 3, 1995. Gadhia resigns as Gov. Parris N. Glendening's 
     campaign treasurer following a report in The Sun describing 
     his fundraising activities. He also takes leave of absence 
     from his $80,000 post as assistant secretary of international 
     economical development in the Maryland Department of Economic 
     and Employment Development.
       May 8, 1995: FBI searches Gadhia's law office and finds 
     evidence of the scheme to launder illegal campaign 
     contributions.
       June 30, 1995: Gadhia resigns his state job.
       Yesterday: Gadhia appears in federal court and admits his 
     role in the scheme.

                          ____________________