BY JOSH MARGOLIN

State and federal investigators are reviewing the fund-raising activities of Roger Rajesh Chugh, a political ally of Gov. James E. McGreevey who recently resigned as assistant commissioner of the New Jersey State Department.

Chugh worked as the Asian outreach coordinator for McGreevey's 2001 gubernatorial campaign. A story in The Record of Hackensack on Sunday reported that he pressured and threatened Asian-Indian business people to donate money to the effort.

State Attorney General Peter Harvey "wants to review the allegations and determine whether or not an investigation is warranted," Harvey spokesman Chuck Davis said yesterday. "An inquiry will be conducted."

Davis said the review was prompted by the Record story, which said Chugh solicited donations from business people in the "Little India" section of Middlesex County who had been cited for building code violations or needed help from town hall. Little India straddles the border of Woodbridge, where McGreevey was mayor for a decade.

The newspaper also said Democratic and Indian community leaders had warned McGreevey about Chugh's activities during the campaign.

Investigators with the U.S. Attorney's Office and FBI have been looking into Chugh's fund-raising for several weeks, according to two federal officials familiar with the probe.

One of the officials said agents yesterday began interviewing people named in the newspaper story and are focusing on whether Chugh used inappropriate pressure tactics to raise money or whether any donations violated campaign laws.

In a telephone interview yesterday, Chugh denied the allegations and said he was the victim of "dirty politics." He said his accusers cited by the newspaper "are the people who have been trying to get me for the longest time. I am done with politics."

If approached by investigators, Chugh said, "then I will answer whatever they ask. Look, the truth is truth and truth always prevails."

Chugh, 49, was hired at the start of McGreevey's tenure. Within months of taking his $85,000 post in the State Department, he became a source of embarrassment when The Star-Ledger reported he was operating a self-promoting Web site (www. rogerchugh.com) that exaggerated his background and state job and read like a personal ad.

Chugh resigned after details of failed business ventures and other questions were raised in a civil lawsuit filed in Middlesex County.

Asked whether he believed the allegations during a news conference yesterday, McGreevey said: "The responsibility is of the U.S. attorney and the attorney general to proceed with an investigation ... that's how the process ought to work, that's how it will work."

But the governor defended his campaign's fund-raising as having had the "strictest vetting process." He angrily denounced assertions that Woodbridge officials did favors for contributors.

"I have ... complete and total confidence that Woodbridge municipal officials acted ethically and properly," he said.