Sunday, December 16, 2012

The Monica Liang Affair

Monica Liang with Gov. Mitch Daniels
I've often wondered why Gov. Mitch Daniels entrusted Mitch Roob with such important positions in his administration. As FSSA Secretary, he forced through the ill-fated privatization of the state's welfare services, which was nothing more than a ruse to direct hundreds of millions of dollars to the hands of his former employer, ACS. As head of the Indiana Economic Development Corporation, he was caught inflating job creation numbers credited to the efforts of the economic development agency. According to a lengthy report in today's Star titled The China Letter, he also covered up the actions of a Chinese immigrant with a checkered past who he had hired on contract in a $100,000 a year position to help with the agency's efforts to forge business deals with China. Before Monica Liang died suddenly in October, 2011, reportedly from a brain aneurysm, she had been quietly removed from her state position after she was later accused of soliciting a bribe and engaging in other self-dealing activities which potentially implicated other state officials. The Monica Liang affair, according to the Star's investigation, was simply swept under the rug and not referred to law enforcement officials for further investigation.

Here's the quick and dirty about the Monica Liang Affair according to the Star:

Liang immigrated to the U.S. from China after getting married in 1997 to an American businessman, Amadio Morais, who was working in China when the two met. She arrived in Indiana in 2001 and becomes a naturalized citizen in 2003. The following year she divorced her husband and walked away with a pretty decent sum of money as part of the couple's property settlement agreement. While living off her divorce money, she takes classes at IUPUI, invests in the stock market and meets a contractor from Marion, Bryan Harris, and winds up buying a building there for $32,000 and becoming a business administrator for a family medicine clinic. Liang gets introduced to Mayor Wayne Seybold, who hires her as a part-time international affairs coordinator, which provides her an opportunity to meet some of Indiana's top officials, including Gov. Mitch Daniels, and she travels with them to China on trade missions to serve as a translator. Liang meets Roob in 2009, moves from Marion to Carmel and later becomes a $100,000 a year contractual employee working for Roob as a Special Assistant to the Secretary of Commerce for Chinese Relations. Apparently while traveling with Mayor Seybold's wife to China after starting her new job, she was soliticiting business deals for herself, including a nursing home project for her Marion building that she claimed involved several government officials, including Daniels, Seybold and Roob. Liang manages to convince a Chinese billionaire, Ao Yuqi, to deposit $50,000 into her bank account. Liang also solicited an $8,000 bribe from another Chinese businessman to secure talks with Indiana officials. Roob later travels to China with Liang and inks a memorandum of understanding with a Chinese company, SME. A month later in July, 2011 a formal complaint is filed by Pacific World Trade with IEDC alleging misconduct by Liang. In September, IEDC terminates Liang and Roob steps down from his position. IEDC months later terminates its contractual relationship with Pacific World Trade after a 25-year relationship. 
Based on the Star's reporting, it sounds like IEDC is being less than forthcoming about the entire Monica Liang matter. IEDC tells the Star that Roob confronted Liang about the allegations, which she denied; however, she continued to take trips on the agency's dime and conduct business more than a month after the agency learned of the complaint against her. Her contract with the agency was terminated at the beginning of September, 2011 based on misrepresentations she had made about her education credentials, not because of the allegations in the complaint, which the IEDC says it was unable to substantiate. "She had claimed a bachelor's degree from Indiana University-Purdue University Indianapolis, but had only attended classes," the Star reports. "The state has a zero-tolerance policy for not accurately documenting your academic credentials," Roob said. Roob became quite defensive when questioned by the Star about the timing of his departure and his relationship with Liang:
On the same day Liang was let go, Daniels announced the resignation of Roob, who had hired Liang.
Officials say it was not related to the Liang incident. "Don't be preposterous," Roob said when asked by The Star about the timing of his departure. He said the two events happening on the same day was either a coincidence, or he wanted to take care of the matter before Dan Hasler took over as the new Secretary of Commerce. "I brought Monica into the agency, right?"
Asked if he had a personal relationship with Liang, Roob answered, "No."
With high praise from Daniels, Roob returned to the private sector as chief executive of the health-care technology company WoundVision. 
The money the Chinese billionaire wired into Liang's account was no longer in her account by the time her personal representative took over her estate following her death in October. Her estate is estimated to be worth about $120,000. The Star obtained records which confirmed the wire transfer of $50,000 into Liang's account had taken place. Roob and Liang had met with Ao in China a month prior to the wire transfer. Asked how that could have happened, Roob told the Star, "I have no idea." The Star also learned that Roob had actually conferred the title of  "Special Assistant to the Commerce Secretary" by letter before she even started work for the agency. "Roob acknowledged the appointment letter came from him but offered few details." "I don't even recall signing the letter, candidly," he told The Star. At the time, she was still working for Mayor Wayne Seybold, who was bothered that Roob had provided her the letter. He told the Star he would have objected to the appointment had he known about it. "At some point," Seybold said, "you gotta work for either one or the other."

Not surprisingly, ethics experts the Star reached found the agency's handling of the matter "woefully inadequate" and created the impression the agency was simply "sweeping it under the rug." "You look at it in hindsight," said white-collar crime expert and former federal prosecutor Peter Henning, "and you go, 'What were you thinking?'" As for what Gov. Daniels knew about the Monica Liang affair: “The governor knew the IEDC dealt with a personnel issue by terminating a contractor after receiving a complaint. He was not otherwise involved in an agency personnel matter.”

None of this surprises me. I used to work for a company that was trying to expand into China. I made one business trip over there and learned all I needed to learn about the business mores there. Remember, this is a country where religion is virtually non-existent, there is a one-child per couple limit imposed by the government, the government forces millions of abortions every year to enforce that limit and the vast majority of the people live in abject poverty and are forced to work at slave labor wages with few rights. People don't value human life there as much as they do in the U.S. The average Chinese citizen wants to get the hell out of the country because of how horrible life is there for the vast majority of people. There is a growing class of super wealthy in China thanks to an extremely corrupt mixed form of crony capitalism and communism that exists there, a system that apparently is very attractive to many of America's elites given the direction we're headed. If you're an American company looking to establish a business relationship in China, you must first set up a Chinese company under which you will conduct business. The China business entity will not meet with government approval until you include individuals blessed by the government as partners in your endeavor, which typically includes Chinese government officials. When Liang told the Chinese counterparts that government officials were shareholders in her American company, they wouldn't have batted an eye because they're used to that arrangement over there and would assume government officials get kickbacks from businesses in one form or another.

1 comment:

I know said...

Just like the Indiana Gaming Commission with their three times defaulted government contract and failed bond posting by the wealthy friends of Daniel's was swept under the rug.

Law enforcement officials know about this one however and were told to ignore it!

Along with a least a dozen lawyers and public officials including retired judges.

Apple don't fall far from the tree when on state agency is playing by their own rules others tend to follow suit. The gaming director authored a public letter to the AG and the IG asking for a contract to be approved outside the normal means and process.

Kind of like Mitch Roob huh?

Maybe some of us are not that stupid afterall