Virginia Gov. Terry McAuliffe: what we know about the federal investigation into his fundraising

There's perhaps no single elected official in the United States more closely tied to Hillary Clinton than Terry McAuliffe. Now the governor of Virginia, he chaired her 2008 campaign, co-chaired Bill's 1996 reelection campaign, and was the Clintons' hand-picked chair of the Democratic National Committee from 2001 to 2005. His 2007 memoir, What a Party!, is more or less a 436-page brag about how close he is to Bill and Hillary.

So it's not exactly great for Hillary Clinton that McAuliffe is now under federal investigation. The inquiry is focused on his 2013 gubernatorial campaign fundraising, and in particular the role of Chinese businessman Wang Wenliang, who contributed about $120,000 to McAuliffe's campaign and inauguration.

It’s not clear if charges will actually be filed or what precisely those charges would be. Indeed, what behavior, specifically, the investigators are focusing on is not evident. But reports from CNN, NBC News, and the Washington Post provide at least some details.

The Wang Wenliang contributions

West Legend Co.

The one donor named throughout reports on the investigation is Wang Wenliang, whose companies have given tens of thousands to McAuliffe's campaign, and who appears to have close ties to the Chinese government. At the same time, Wang himself appears eligible to donate, making it unclear what wrongdoing, exactly, accepting donations from him would constitute.

Worth an estimated $1 billion, Wang owns a key port in northeast China, near North Korea; his companies also ship soybeans through ports in Virginia, according to the Washington Post's Matt Zapotosky. His company, Rilin Enterprises, has donated $2 million to the Clinton Foundation (which is not accused of any wrongdoing), funded NYU's Center on US-China Relations (Wang has given the school $25 million total), and was involved in building the current Chinese Embassy in Washington.

The latter, veteran China observer Jim Mann told CBS News, suggests that the company is connected with the Chinese security apparatus: "Embassy construction [is] one of the most important tasks is making sure that there are no bugs there. So you want to have the closest security and intelligence connections with and approval of the person or company that's going to build your embassy."

Wang holds a green card, making him eligible to donate in American elections. But he has also served in the National People's Congress, the mostly ceremonial legislature in China, and was a municipal official in Dandong, a city on the North Korean border. An investigation by the New York Times's Louise Story and Stephanie Saul found that one of Wang's construction companies, Columbus Skyline LLC, housed workers in "hazardous, unsanitary" conditions that prompted concern from officials in Jersey City.

Records show that West Legend Co., the New Jersey affiliate of Rilin Enterprises, donated $70,000 to McAuliffe's gubernatorial campaign in 2013: $10,000 in March and another $60,000 in September. The company gave another $50,000 to McAuliffe's inaugural committee on November 21. Virginia does not have any state-level contribution limits for individuals or corporations.

"An American subsidiary of a foreign corporation cannot contribute campaign funds if it is financed in any way by its parent company or if individual foreign nationals are involved in the decision to make the donation," Zapotosky explains. If funds from West Legend's parent company were used for the donation, or if officials who unlike Wang do not have a green card were involved in the decision to donate, then the donation could be legally questionable.

But Zapotosky implies the allegations could be more serious than just $120,000 in legally dubious contributions. He reports that investigators are scrutinizing McAuliffe's own finances, and "are interested in foreign sources of income." The implication, then, is that McAuliffe may not only have gotten money from the group but might have business ties to them as well.

For its part, West Legend Co. said in a statement that it "does business in Virginia and supports Governor McAuliffe’s jobs-creation agenda. Its political contributions comply with all federal and state laws." McAuliffe's attorney, Marc Elias, stated, "Contributions to the campaign from Mr. Wang were completely lawful. The governor will certainly cooperate with the government if he is contacted about it."

Why funny-money allegations about McAuliffe aren't the most surprising thing in the world

Mario Tama/AFP/Getty Images

At this point, we don't know if McAuliffe is actually guilty of campaign finance offenses, serious or otherwise. But given his background, a scandal involving an intersection of private business interests and big-money fundraising isn't exactly shocking.

McAuliffe rose to prominence due to his by all accounts extraordinary talent at fundraising. A 2001 LA Times piece written upon his election as chair of the Democratic National Committee noted that he "has an effervescent energy as well as unparalleled ability to wring campaign contributions from people. He raised more than $26 million for the Democratic Party at a single event last year."

McAuliffe makes no attempt to hide this, and in fact flaunts it. In his book he brags about raising so much money for Clinton-Gore in 1996 that the campaign's fundraising was shut down on September 21, 1995, lest it raise too much to qualify for public financing. He recounts a conversation between the president and vice president, in which Gore asked why McAuliffe kept coming up as a potential '96 campaign finance chair and Clinton replied, "Al, because he's the best."

Nor is the governor particularly shy about his fundraising and political activities sometimes intersecting with his many and varied business endeavors. ''I've met all of my business contacts through politics. It's all interrelated,'' he told the New York Times's Jeff Gerth in 1999.

This has occasionally created political problems for McAuliffe. His role as the single biggest investor in GreenTech Automotive, an electric car company that bragged in pitches to investors that it would get billions in government subsidies and tax credits, became an issue in the 2013 race. The company's prospectus, which specifically mentions McAuliffe's ties to the Clintons, "fits into a pattern of investments in which McAuliffe has used government programs, political connections and access to wealthy investors of both parties in pursuit of big profits for himself," per an investigation by the Washington Post's Tom Hamburger and Peter Wallsten that year.

There was Global Crossing, where he made about $8 million after being connected through its founder Gary Winnick, a frequent political donor. There was Carl Lindner, the head of Chiquita Brands, whom McAuliffe introduced to Clinton and encouraged to donate, and who partnered with McAuliffe in buying a homebuilding company in Florida. There was his deal with the electrical workers union, a big donor to Democrats, which he got to invest $40 million in a Floridian development scheme.

Again, none of this was actually illegal, and none of it prompted indictments. It's perfectly within bounds. But it's given McAuliffe a reputation for mixing business with fundraising extensively. That context might help explain some of the suspicion surrounding his relationship with Wang, regardless of whether he in fact did anything wrong.

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