The Company He Keeps

By Margaret Carlson/Washington

The world of the Washington lobbyist operates below radar most of the time, in purring black limos, private jets and expense-account restaurants with tables set far apart. Ron Brown was one of the most successful inhabitants of that world until last December when, after serving as chairman of the Democratic Party for four years, he was nominated to be Secretary of Commerce.

With that post, Brown crossed over from the shadowy world of the Washington dealmaker to the well-lighted one of public official, where every move is subject to review, there are no secrets, and past acquaintances can rise up to eat you.

Brown's nemesis emerged in February in the form of Ly Tranh Binh, a failed Florida businessman, who charged that Brown, at his longtime friend Marc Ashton's behest, had agreed to represent him and a former Vietnamese official, Nyugen Van Hao, in developing business with Vietnam and helping lift the Vietnam trade embargo in exchange for $700,000.

So far, no firm evidence has emerged that Brown is guilty of anything except poor judgment. The most disturbing report about his possible role in the affair came Monday when Brown's lawyer, Reid Weingarten, said that contrary to the impression left by two earlier denials, Brown had actually met with Hao on three occasions, raising questions about what else Brown might not be revealing. On Friday ABC-TV reported that the FBI had copies of two faxes that Hao sent to Vietnam officials in December saying that Brown's reaction to his offer had been "positive." Last Saturday the New York Times reported that federal investigators had uncovered evidence that the Vietnamese were preparing to establish a special bank account in Singapore. While it is not clear whether this account had any connection with the money Binh claimed was being funneled to Brown, U.S. officials confirmed to TIME that a number of money transfers to banks in East Asia have aroused their suspicions and are being investigated. The odd cast of characters involved also piqued curiosity: the penniless Binh; Hao, a Ph.D. and former Deputy Prime Minister of South Vietnam now reduced to owning a Kwik Stop in North Lauderdale, Florida; and Ashton, a gourmet-food purveyor in Pompano Beach who became his friend a decade ago when Brown represented Haiti's Duvalier regime. Then there are the extremist fringes of the POW/MIA movement who will do almost anything to keep the U.S. from resuming full relations with Vietnam and to whom Binh's allegations are a godsend.

It turned out that one of the meetings between Brown and the two South Vietnamese took place at a town house owned by Brown and his son Michael but lived in by Lillian Madsen, who describes herself as "a close personal friend" of Brown's, is estranged from her Haiti-based husband, and is Ashton's sister-in-law.

In coping with the accusations, Brown broke the first rule of dealing with the feeding frenzy that follows any allegation: tell everything you know. Quickly, a story can move from the heart of the charge -- a $700,000 bribe -- to a detail, which if true is innocuous, but if denied and later revealed, looks suspicious. While Brown called the charges "preposterous" at every one of his appearances last week, he did not refute the allegations one by one.

But so far, the man who counts most of all, Bill Clinton, has stood by him. Brown told Clinton about the meetings while traveling on Air Force One to Alameda Naval Air Station last August, and Clinton has made a point of showing his support throughout the controversy. Last Tuesday the President walked into the Roosevelt Room in the West Wing at Brown's side and heaped praise upon him at an announcement of a new export strategy. "He told me that he hasn't done anything wrong," said Clinton. "He's done just about everything right as Commerce Secretary. I think he's done a great job, and I have no reason not to believe him."

At this point Brown's credibility is enhanced by the fact that his accuser has presented so little evidence to corroborate his tale. For one, Binh has never met Brown and never attended any of the meetings between Brown and Hao that Binh claims to describe. He made his accusations after a falling-out with Hao, the reasons for which are in dispute. And Binh has nothing in the way of a paper trail -- no agreement with Brown to represent them that Hao said he had hand-delivered to Vietnam, for instance, and no canceled checks.

Nonetheless, the Miami FBI opened a criminal inquiry, since any allegation against a public official must be investigated, even if based on inadmissible hearsay. The FBI gave Binh a lie detector test that found him to be "not deceptive," so, according to the Wall Street Journal, they outfitted him with a recording device with instructions to draw Hao out again on the alleged deal. Although Binh -- given the code name "Radar" -- tried mightily in three conversations with Hao, Binh was not able to get anything incriminating on tape.

The charge languished at the FBI for seven months. Hao, who denied he had met with Brown when asked by reporters, nonetheless told the grand jury that he had met with the Commerce Secretary. But he denied Binh's other allegations, according to a source close to Brown. Curiously, Binh has not yet been called to testify.

Meanwhile, the source close to Brown describes a different series of events in which, at worst, Brown can be seen to have been simply manipulated by his friend Ashton. According to this sympathetic account, Brown stopped to see Ashton in August on his way back from a meeting of Democratic state party officials in the Virgin Islands, and they had dinner along with Hao at a nearby restaurant. Brown was polite and wished the pair good luck in their joint venture to do business with Vietnam when trade reopened. Hao took one of Brown's business cards. In December Ashton was visiting his sister-in-law and asked Brown to stop by for a bite to eat. Hao was there when Brown arrived, with a crude letter he had brought back with him last December from the Vietnamese government congratulating Brown on the election and expressing hope that the two countries would form better relations. Brown said he was going into government and did not want to accept any such letter. He left the letter on the table.

Ashton called Brown a few days later, saying that by not accepting the letter he had embarrassed Hao, and so he sent Brown a prepaid Federal Express envelope asking him to write Hao a letter. Brown took a note card with his name printed on it and wrote something like "Nice to have met you. Happy holidays." The source close to Brown says this is the only piece of paper Hao has with Brown's handwriting on it.

Then on Feb. 13, Brown got another call from Ashton in New York, saying that he had a layover in Washington and inviting Brown to have lunch with him and Madsen. Brown met them at Mr. K's, a Chinese restaurant downtown. Ashton then told Brown that he had asked Hao to stop by. Ashton asked if they could see Brown's new office. The source says Brown "wanted to help the not terribly successful Ashton, and there was still no flashing light that said to him he shouldn't be seeing this guy Hao." The group got in its rental car and Brown into his government vehicle and went to the Commerce Department for a 20- minute tour, including a walk around the Black History Month exhibit in the lobby that included a portrait of Brown. That was the last Brown would hear of Hao, according to this account, until Binh brought Hao back into Brown's life with his charges last summer.

Binh has had some help in peddling his story. Last week the archconservative National Vietnam Veterans Coalition flew him to Washington at its expense for a press conference, where he stood, scarcely 5 ft. tall in his shiny blue-gray suit, with sweat dripping from his forehead. Binh was joined by several Republican Congressmen, including Robert Dornan, who railed that "this should put a halt to Clinton's abominable normalization drive." Binh's allegations have surfaced in other publications of POW/MIA groups deeply opposed to resuming relations with Vietnam. The National Vietnam POW Strike Force, for instance, reprinted an article in July from the Spotlight, a far-right newsletter affiliated with Lyndon LaRouche, which accused "Clinton's little nigger homeboy" of "taking a $700,000 bribe from Hanoi gooks."

Brown can easily brush off the ugly rhetoric of fringe groups like LaRouche's. But he was criticized prior to his confirmation by more credible sources for his choice of clients -- like "Baby Doc" Duvalier and Japanese consortiums -- and possible conflicts of interest. Questions were also raised about his business dealings while chairman of the Democratic National Committee. Among them: taking brokerage fees from municipalities as part of a company providing retirement plans, and choosing New York as the site for the Democratic Party's 1992 convention when a company he had a financial interest in was negotiating for a contract to treat the city's sewage.

For the moment, Brown has entered the maw of the Washington scandal mill from which there is no complete escape. If he is lucky, there will be no Vietnamgate in his obit, and the worst judgment against him will be that he was duped by Hao and Ashton, who in turn duped some gullible Vietnamese officials, impressed by no more than a business card and a holiday greeting. Brown may not have been sufficiently sensitive to the difference between his former profession and his new one -- that the people you can meet as a private citizen you can't bring home any longer, when home is the Secretary's office of the Department of Commerce. Even when a friend asks.

With reporting by Elaine Shannon and Bruce van Voorst/Washington