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Time
07/21/97 BY MICHAEL WEISSKOPF

NATION

LIPPO'S MAN IN THE BACK ROOM

BY MICHAEL WEISSKOPF

If John Huang was the Lippo Group's front man in Washington, investigators say, Joe Giroir was its back-room brains. The Arkansas lawyer emerged from the sidelines of Donorgate last week when the Senate hearings put a spotlight on his frenetic lobbying to land a Democratic fundraising job for Huang, Lippo's favorite son in the U.S. But investigators tell TIME that Giroir played a more pivotal role for the Indonesian conglomerate in its quest for influence in Washington: after securing Lippo as a $3 million investor in his company, Giroir contributed a total of $175,000 to the Democrats.

Lippo's campaign for Washington clout began shortly after Bill Clinton's swearing-in. The Riadys, who control Lippo, formed a partnership with their old friend Giroir to line up U.S. investors for the family's Asian ventures. Giroir, 58, had been a risk taker ever since he made his mark as Arkansas's first big-time securities lawyer two decades ago. As the Rose Law Firm's managing partner, Giroir helped hire Hillary Clinton but was then ousted by her and other partners after some of his outside deals began to conflict with Rose's interests. By then, Giroir already knew the Riadys and was a board member of Worthen National Bank, which they owned jointly with the investment firm Stephens Inc.

The new Riady-Giroir venture--Arkansas Industrial Development Corp., from which Giroir drew a $360,000-a-year salary--was financed by a Lippo subsidiary. Giroir's job included serving as Lippo's unofficial representative to the White House. Investigators tell TIME that Giroir used his Arkansas contacts to set up a meeting there in April 1994 for prospective Chinese partners with Lippo in a huge China power-plant project. But Huang, then head of Lippo's U.S. operations, wanted a regular role for himself in the Clinton Administration. So investigators now want to know if Giroir pulled any strings to get Huang hired in July 1994 as a Commerce Department deputy assistant secretary, a job that gave him access to classified economic data from Asian countries where Lippo has a big stake. At Commerce, Huang stayed in regular contact with Giroir, as well as Lippo, and frequented the Washington office of a company that Giroir represented, using its phones and a fax machine for what investigators suspect were transmissions of secret material to Lippo. Huang's lawyer says those suspicions are based on innuendo. Giroir's lawyer declined to comment.

The midlevel Commerce job proved to be far from the center of power. So Giroir helped Huang get into campaign finance, the cockpit of politics. Last week's hearing portrayed Huang's patron as relentlessly promoting him in repeated visits and calls to party officials and at an Oval Office meeting with Clinton and Riady. It worked: Huang became deputy party finance chairman in December 1995 and raised $3.4 million. About $1.6 million had to be returned after the party decided the money could have come from abroad.

Until the campaign ended, Huang looked like a fund-raising phenom. But it was a success that Giroir helped make possible. Investigators tell Time that at a May 1996 fund raiser organized by Huang, Giroir wrote a check to the national party for $25,000 and let Huang fill in the names on three other checks of $25,000 each that wound up in state party coffers. And on July 30, at Huang's direction, Giroir contributed a total of an extra $75,000 to three states.

--With reporting by Viveca Novak/Washington

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