As befitted a man who spent his life in the shadows, General Ji Shengde chose to wait in the kitchen of an abalone restaurant in the Chinese coastal resort town of Zhuhai until his dining companions arrived.

The ultra-secretive chief of Chinese military intelligence was on the lookout for his protege, a well-dressed, 37-year-old businesswoman called Liu Chaoying. She was bringing her new friend, a California-based entrepreneur called Johnny Chung who had a penchant for over-the-top jewellery and a knack for getting inside Bill Clinton’s White House.

Once the pair arrived and the group was seated, they talked American politics. It was 1996 and Clinton was running for a second term.

“We really like your president. We hope he will be re-elected,” General Ji told Chung.

“I will give you $300,000. You can give it to your president and Democrat party.”

A few days after this August 11 meeting, Liu Chaoying wired $300,000 into Taiwan-born Chung’s account. Some of this money ended up in the coffers of the Democrat’s Clinton re-election campaign in breach of US laws banning foreign political donations.

This transaction later became the focus of US criminal and congressional investigations into a major political scandal dubbed Chinagate by the US media. It was part of a broad Chinese plan to influence American politics to favour Beijing’s acquisition of sensitive, advanced technology.

Today, Fairfax Media can reveal a direct Australian connection to the Chinagate scandal that raises serious questions about a series of Chinese donations to the Australian Labor Party.

A summary of banking records contained in NSW Supreme Court files show that, just 10 days after the meeting in the abalone restaurant, a Sydney-based company owned by Chinese-Australian businesswoman, Helen Liu, wired $250,025.00 from her Australian company into the account of one of Liu Chaoying’s Hong Kong companies called Marswell Investments.

Just why Helen Liu’s company Wincopy Pty Ltd sent this money to Liu Chaoying is not known. Whatever the case, the transfer effectively topped up the bank account of a company US prosecutors later claimed as a front for China’s military intelligence. A copy of Wincopy’s financial statements and reports prepared by the company's accountant - and obtained from a Federal Court file - recorded the $250,025.00 transfer as “overseas marketing expenses”.

Like the others, Helen Liu was interested in politics. But her focus was Australia. At the time of the quarter-of-a-million-dollar transfer into Liu Chaoying’s Marswell company, she had just made her first donation to the ALP and had forged links to the federal Labor front bench and the NSW Labor government.

Australia’s freewheeling donations laws meant that Liu’s donations never created a scandal like that seen in the United States, and the links have never been adequately examined by Australian authorities. But evidence uncovered by Fairfax Media and the ABC means that might be about to change.

Helen Liu with John Howard and Joel Fitzgibbon.

The networker

Helen Liu arrived in Sydney from Shandong province in northern China in the late 1980s as a seemingly modest student and worked at a firm exporting wool to China. But it did not take too long for her life to undergo a massive transformation.

“It was like the tap had been turned on and all this money suddenly started pouring out,” said a close associate at the time. “Top-line European cars were being bought with cash.”

The money came from Chinese Government-controlled entities such as the Industrial and Commercial Bank of China, Beijing Hengtong Trust, the Jinan Iron and Steel Group and the Shandong Fisheries Corporation. All had entered into joint ventures with companies associated with Helen Liu and her then boyfriend, Humphrey Xu.

The pair set about amassing a Sydney property portfolio worth tens of millions of dollars. Among their tenants was a NSW government department. They exported Australian iron ore and wool to China. In their homeland, the couple embarked on huge real estate developments across several provinces in close co-operation with local officials.

They achieved Australian citizenship through sham marriages to a far younger Sydney couple then began building a network of politically powerful friends in their adopted country. Their target: Australia’s most ruthless political faction, the NSW Labor Right.

The foundation stone of this relationship was laid in 1993 when one of Helen Liu’s companies, Diamond Hill International, took a knockabout federal Labor MP, the late Eric Fitzgibbon, on a first-class trip to Liu’s home province of Shandong. Fitzgibbon’s job was to shake hands with an array of Communist Party officials and tell them just what a big deal Helen Liu and her boyfriend were back in Australia.