MIAMI (AP) _ A jewelry companyused photos of its executives posing with President Clinton to help defraud 15,000 investors of almost $40 million in a pyramid scheme using cheap necklace kits, investigators say.

The executives fled overseas before the collapse of the fraud, one of the costliest credit card scams in U.S. history, according to authorities.

Losses for banks and financial service institutions could run higher than $20 million after many investors tried to issue ``charge-backs'' to stop credit card payment to Unique Gems International Corp.

A judge shut down the company in March after authorities uncovered the illegal ``Ponzi scheme.''

In such a fraud, early investors are paid off _ not through legitimate profits, but with money coming in from more recent investors. Some investors lost their homes and savings.

Richard Sharpstein, attorney for Unique Gems President Enrique Pirela, said the company was not a pyramid scheme, but was hurt by the premature enforcement by Florida's attorney general.

``We say Unique Gems was a well-intentioned business, not a fraud,'' Sharpstein said Monday. '' The attorney general jumped in far too quickly to shut it down.''

A court-appointed investigator, Lewis B. Freeman, said about 30 Unique Gems executives and workers attended a Democratic National Committee fund raiser at the Biltmore Hotel in Coral Gables last fall, buying their seats to the Miami dinner with $85,000 that was contributed to the DNC by others. Investigators were trying to determine whether such violations by third parties may be aviolation of federal law.

During the event, Freeman said, the executives posed for photos with Clinton, and later reproduced the pictures in newsletters mailed out to potential investors.

The fliers showing a smiling Clinton with a company executive said: ``The company has been honored by President Clinton for its role in helping many people with real opportunities to earn a well above-average income.''

DNC spokesman Steve Langdon said the Democrats have no record of contributions from Unique Gems and ``to the best of our ability, we'll be assisting the receiver (Freeman) to determine whose names are connected with the donations. The DNC will refund the appropriate amount of money.''

Will Dwyer, spokesman for the House Government Reform and Oversight Committee, said the information about the Unique Gems' contributions is being circulated among committee members, who have focused their investigation on improper contributions to the political parties and to Clinton.

``I don't know that this has come up before,'' Dwyer said Monday. ``If this has substantial interest, they would look into it.''

Sharpstein said the use of Clinton's photo on brochures was ill-advised, but ``has been blown out of proportion.''

Freeman said the DNC's involvement generated interest in the investigation, but the bigger story is ``about people coming into this country, stealing the money and going to Spain to be insulated.''

Pirela was in Venezuela, while the three men who masterminded the scheme, including Swedish national Harry Abonde, were believed to be in Spain, authorities say.

Sharpstein said Pirela left the country because people were attacking him and his car after the attorney general shut down the company. No criminal charges have been filed, although the state attorney's office has been considering the case.

Early investors would give the company $3,000 for a kit worth about $100 to make necklaces out of beads and thread, and return them to Unique Gems for up to $4,800 per kit.

Those who charged the initial investment to credit cards could pay back the charge card and make $1,800 without spending a dime. Some invested more than $100,000 for the quick profits that were available at first.

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