By John Solomon and Matthew Mosk
Washington Post Staff Writers
Sunday, September 16, 2007
To raise $850,000 for Sen. Hillary Rodham Clinton's presidential campaign in just eight months, Norman Hsu tapped an eclectic group of donors that included wealthy investors in his apparel ventures, hotel shopkeepers, a 96-year-old in a Florida retirement home and an auto-body worker who mistakenly thought he would get a tax break for his political generosity.
The Clinton campaign has not yet released any information about the 260 donors whose contributions it is now refunding because they were credited to the prodigious fundraising of the former fugitive, but a detailed analysis of donors Hsu brought to Clinton shows that he tapped many Asian American donors in California and New York, including complete strangers as well as his relatives. He also raised political funds from people who had already invested large sums in his private business ventures.
Some donors among the nearly 100 identified this week said they never met Hsu and did not know that their donations had been credited to his fundraising. Others had trouble explaining why they gave the funds to Clinton or could not recall the circumstances in which they met Hsu.
"He called me and asked me if I'd give $1,000. . . . I don't know how you'd say we struck up a relationship. I just knew him," said Henry Rosenberg, a New York City lawyer. Asked if he wanted Clinton, New York's junior senator, to be the next president, Rosenberg said: "I don't know. He just asked me to do it, and I did."
Nay Oo, another Clinton donor for whom Hsu claimed credit, was listed in the candidate's fundraising reports with an address in Daly City, Calif. The home's owner, Ellen Yee, said Oo used to rent a room in the house but hadn't lived there for years. A man who returned a call to Oo's phone and identified himself as Oo said he works in an auto-body shop and does not know Hsu. He said he donated $250 to Clinton at the request of a landlord. "I thought it was going to be a tax write-off," he said.
The case of the mysterious bundler has become a major embarrassment for Clinton and an echo of the campaign finance scandals that surrounded her husband's presidency in the 1990s. The campaign's decision to return the money associated with Hsu followed his recent arrest on charges of trying to outrun a 15-year-old warrant, but many questions remain about Hsu's fundraising tactics, the origin of the funds and whether they were all given legally.
The names of Clinton donors for whom Hsu claimed credit were confirmed through a computer analysis of donations as well interviews with several people familiar with Hsu's fundraising. None of the donors connected to him has been accused of doing anything wrong.
Robert H. Emmers, a Los Angeles publicist hired by Hsu's attorney, said Hsu -- who now sits in a Colorado jail cell -- is not responding to any of the allegations leveled against him. "There's a lot of speculation out there," Emmers said. "Mr. Hsu is not in a position to defend himself right now, so that needs to be taken into account."
In just four years before being taken into custody, Hsu became a top political fundraiser. Not only was he among the top 15 "bundlers" nationwide for the Clinton presidential campaign, but he also helped fund the Democratic Senatorial Campaign Committee, various congressional and Senate candidates, and the leadership committees for other presidential candidates such as Sen. Barack Obama (D-Ill.) and Sen. Joseph R. Biden Jr. (D-Del.).
His intensive fundraising brought him close to their campaigns, which showered him with dinner invitations and opportunities to get his picture snapped with the politicians -- contacts that some businessmen said lent credibility to Hsu's efforts to sell investors on his clothing ventures.
But his pursuit of political and business funds at the same time -- from many of the same people -- leaves unclear which was the end and which was the means. Was Hsu hoping to leverage his political affiliations to boost the credibility of his business? Or did he intend the more than $2 million he bundled in political donations in four years to curry favor for some as-yet-undetermined goal?
"Never once, that I ever came across, did he seem to have a particular policy or issue agenda," said Hassan Nemazee, one of Clinton's top New York fundraisers. "The only thing he ever seemed to want was to get his photo taken."
Hsu, an immigrant from Hong Kong who by several accounts is a charming and easygoing man with an imperfect command of English, was convicted in California in 1991 for corporate theft, according to court records. Both the donors and the Clinton campaign have said they did not know about his past troubles during the period that he was channeling funds to the candidate. Several who mingled with Hsu at Clinton's lavish fundraising parties, strategy briefings and intimate dinners said he shared little about himself, beyond his work in what they called "the rag trade."
Hsu's encounters with law enforcement authorities include a 1990 incident in which he was kidnapped by a Chinese organized-crime figure, Raymond "Shrimp Boy" Chow, who said Hsu owed him money, according to Foster City, Calif., police. Officers said they interrupted the crime during a 3 a.m. traffic stop, rescuing Hsu from the back of a Toyota.
Hsu was taken into custody Sept. 6 in Colorado after failing to appear at a bail hearing related to the California theft case, threatening suicide and then falling ill on a train.
Before his controversial past surfaced in late August, Hsu had built a reputation as an effective bundler of donations by others. "We sought him," said Marc Dunkelman, vice president for strategic communications at the Democratic Leadership Council, an advocacy group for centrist Democrats that was once chaired by Bill Clinton. Hsu donated $25,000 to the DLC this year, and the group is refunding the money, Dunkelman said.
Hsu's name was referred to the Clinton campaign by professional fundraisers who were aware of his donations to other campaigns and groups, according to a former Clinton aide. Hsu's donors to the Clinton presidential campaign included four others with the last name Hsu, including his grown son, Oliver. They gave a total of $16,100.
Hsu also claimed credit for donations by two other people, Danny Lee and Yu-Fen Huang, who have given $154,000 to Democratic causes since Hsu began his fundraising in late 2003. Fundraising and property records list them as joint owners of a nearly $1 million home in the New York neighborhood of Forest Hills.
The donations from Lee and Huang include $38,000 to Clinton's Senate campaign, political action committee and presidential committee. The two gave a total of $9,200 -- the maximum allowed -- to Clinton's presidential bid in the first quarter of this year, donations for which Hsu claimed credit. They also gave $8,400 in January to Clinton's 2012 Senate campaign, even though her reelection bid is six years off.
The two listed their place of employment as Newspring Packaging in Mount Carmel, Pa. Lee is listed as a vice president of Newspring, which makes plastic containers for food, and Huang is listed as a manager.
A third employee of Newspring, Soe Win Lee, also donated the maximum allowed amount to Clinton's campaign and made other recent Democratic donations. None of the three Newspring employees returned calls to their company seeking comment. Newspring's parent company, Pactiv Corp. of Illinois, said it does not comment on the private activities of its employees. It is not clear what connection, if any, Hsu had to the firm.
A few donors for whom Hsu claimed credit said that they didn't know him and that others must have passed their checks to him to give to Clinton's campaign.
Karen Tan, an employee at Super One Vision in San Francisco, said a friend who worked for California Assembly Majority Whip Fiona Ma asked her to contribute to Clinton. Donations that Ma collected, including Tan's, were credited to both Ma and Hsu because together they threw an August fundraiser for Clinton. Hsu contributed $8,300 to Ma's 2006 campaign.
A review of fundraising records found much overlap between Hsu's business investors and the political donations for which he claimed credit -- something that is common among political bundlers, who often solicit contributions from their business contacts.
For example, Hsu received fundraising credit with the Clinton campaign for $19,200 in contributions from executives at Source Financing Investors, a New York City investment fund run by 1960s Woodstock concert organizer Joel Rosenman, on March 28. The next day, Rosenman's 96-year-old father, Bernard, sent $4,600 to Clinton from his Boynton Beach, Fla., retirement home, for which Hsu also claimed credit.
The investment group put $40 million into 37 separate investment proposals by Hsu to import clothing from China, according to Seth L. Rosenberg, a New York lawyer for the group. But Rosenberg said he believes that the money may be gone. The New York City district attorney has launched an investigation of the allegations.
Rosenberg said he has asked politicians to hold on to any checks they collected from Hsu. "We want to be sure that any candidates who received money from Mr. Hsu act responsibly with those contributions so they may be returned to the victims of Mr. Hsu if indeed they are the source of those funds," he said.
Three members of the Paw family in Daly City, Calif., both donated to Clinton and invested in Hsu's apparel business, a circumstance first reported last month by the Wall Street Journal. The Paws operated a gift shop in a hotel where they befriended Hsu in the 1990s.
Frank Ubhouse, the Paws' attorney, said Friday that although the family initially made some money, its members are concerned about the fate of their remaining investments with Hsu. "Given what is now known, I think there's got to be a lot of concern. The big question is, when the music stops, will everyone have a chair?"
In Irvine, Calif., businessman Jack Cassidy alerted the FBI and Clinton's campaign this summer to his concerns that Hsu was soliciting people he knew for investments in what appeared to be an illegal Ponzi scheme, in which early investors are rewarded with funds obtained from subsequent investors. The FBI recently interviewed Cassidy and collected documents as part of an initial inquiry.
Cassidy said he was concerned that Hsu had invoked his role as a Clinton fundraiser to gain the confidence of people he was meeting. "If you are opening a hamburger stand, you want to put a set of golden arches outside," Cassidy said, referring to the McDonald's symbol. "Hsu was using Hillary Clinton as his golden arches."
Another California resident, Chi Kou Fan, alleged that he was bilked years ago in the investment that resulted in Hsu's 1991 conviction on grand theft. He recalled that "Norman would make friends with one guy, and then move around to meet all this guy's friends, and soon they would all be his investors."
Fan, a retired San Francisco area real estate developer who lost $240,000 in the Hsu investment, was one of 16 investors in a deal to sell latex gloves imported from China to an Illinois company, Service Master, according to court records. In early 1989, as the deal took shape, Hsu promised investors a 5 or 6 percent return on their money. But after a year, investors had still not seen their money. When state investigators called Service Master's accountants, they found no record of any deal for latex gloves.
Research editor Alice Crites, staff researcher Madonna Lebling and washingtonpost.com database editor Derek Willis contributed to this article.