So back to the burgeoning scandal in Taiwan and how it might make it to Washington, DC. At this point the details remain murky. But here’s some of what’s been reported.
According to reports in Hong Kong’s Sing Tao Daily 
and the South China Morning Post, three years ago James Kelly — now Assistant Secretary of State for East Asia and the Pacific — helped high-ranking members of the Taiwanese government use secret slush fund money to take care of a friendly Japanese politician, Masahiro Akiyama, after he had been forced to resign from the government. Akiyama had helped Taiwan leverage its way into a proposed US Theater Missile Defense.
(This article in 
Singapore’s Straits Times says the Taiwanese also paid off Masahiro and then-Japanese Prime Minister Ryutaro Hashimoto for their assistance helping Taiwan on Missile Defense.)
What’s being alleged about Kelly is very specific. So I’m just going to quote at length from the relevant passage in the article in today’s South China Morning Post:
The documents said Mr Lee [former Taiwanese President Lee Teng-hui] in February 1999 authorised the NSB [the National Security Bureau] to pay US$100,000 (HK$780,000) to the Pacific Forum at the Centre for Strategic and International Studies (CSIS), a Washington think-tank with close ties to the US military establishment, to support former Japanese vice-minister for defence Masahiro Akiyama’s two-year study at Harvard University after his forced resignation in October 1998 in a defence contracting scandal. Mr Kelly was then Pacific Forum president.
The report alleges the funds served as a payback for Mr Akiyama’s work with Taiwan and US military officials in pushing for Taiwan’s possible inclusion in the Theatre Missile Defence System provision in the Japan-US Joint Declaration on Security treaty of 1998.
In the secret document dated December 15, 1999, then NSB director Ting Yu-chou authorised the NSB to give US$100,000 to Peng Run-tzu, president of the Taiwan Transport Machinery Corporation and a close personal confident of Mr Lee, to transfer to CSIS. Mr Peng allegedly deposited the US$100,000 into a CSIS account on December 20.
In another document dated February 2, 2000, Mr Ting confirmed the transfer occurred after Mr Kelly met Mr Peng in January 15, 2000, in a Los Angeles restaurant to confirm the deposit.
More to come…
