Taipei police raid magazine

Next magazine's editor, Peir Woei, shows the press the cover of the edition containing allegations against Lee

(CNN) -- Taipei police have seized copies of a magazine which purported to carry classified documents containing allegations linking former President Lee Teng to the use of a multi-million dollar slush fund.

In the issue of Next magazine scheduled for publication Thursday, the mass-circulation weekly reports that according to internal National Security Bureau (NSB) documents, former president Lee set up a NT$3.5 billion secret fund in the bureau in 1994 to finance special diplomatic missions aimed at boosting ties with the U.S.

Next magazine alleged that Lee's successor, President Chen Shui-bian, continued to use the money until last year and that the fund, as well as interests accruing from it, was spent in promoting Taiwan's interests in the U.S., Japan and other countries, including lobbying influential politicians and parliamentarians.

According to the documents, the fund enabled Taiwan security and defense officials to establish close ties with counterparts in the U.S. and Japan and it was also used to secure congressional and other political support in Washington for Lee to pay a visit to Cornell University in mid-1995.

The magazine claimed that the fund was used for securing American and Japanese backing for Taiwan when Beijing unleashed a series of intimidating war games off the Taiwan coast in retaliation against Lee's visit to the U.S.

Staff bonuses

The NSB documents purport to show that from late 1996, NT$2.75 million was spent every year to secure intelligence from Japan through a Taiwan businessman who had good connections in Tokyo.

Another US$11 million was reportedly used to prolong diplomatic relations with South Africa for three years.

Further allegations reported by Next were that apart from diplomatic and lobbying activities, Lee, who stepped down from office in 2000, also dipped into the fund to pay bonuses for selected staff during festivals such as Lunar New Year.

Chief Editor of Next, Pei Wei, said police had raided not only the magazine's office and printing plant but also the home of the reporters.

He accused the police of trying to prevent the Taiwan public from reading material that would embarrass the government.

"The people have a right to know," Pei said. "That's why we have decided to release the material in detail."

'Illegal' possesion

Two former heads of the NSB had already been forced to leave office following accusations about the improper use of finances.

Sources in Taipei said a former NSB official, Liu Kuang-chun, who had fled abroad after having been accused of embezzling part of the slush fund, had made available the classified documents to selected Taiwan media.

In a statement at Wednesday noon, the NSB said Next magazine had "illegally" taken possession of classified intelligence material.

The statement said the authorities had raided the Next printing plant and seized copies of the magazine "to safeguard national security and overall interests [of Taiwan] and to safeguard the rights and safety of international friends and related personnel."

NSB also censured the Web site of the Taipei-based China Times, which had early Wednesday run material from the classified documents.