Political fund-raiser Maria Hsia, a longtime associate of Vice President Gore, was convicted yesterday of channeling more than $100,000 in illegal contributions to Democratic candidates in 1996, including $65,000 in tainted money she brought in the day after Gore's controversial appearance at a Buddhist temple.
The verdict marked one of the biggest victories yet for the Justice Department's oft-criticized campaign finance task force. It also rekindles an issue that could cause Gore problems in his quest for the presidency. Within an hour of the jury's finding, the Republican National Committee--which had a staff worker follow the trial--issued a statement depicting Hsia as a "small fry" target and calling on prosecutors to go after Gore and other Democratic Party leaders.
Gore, who has never been charged with criminal wrongdoing, has known Hsia since the late 1980s, and she once harbored hopes of working on his presidential campaign. Prosecutors contended that he was unaware of any problems with Hsia's activities.
"The jury has rendered a verdict. It's a hard day for her," Gore told reporters while visiting a kindergarten in Manhattan. "She's been a friend and a political supporter. But since this is a matter still in the courts I won't comment on it."
The verdict followed 10 hours of deliberations and a three-week trial in U.S. District Court in which the jury got an exhaustive education in campaign fund-raising tactics and federal election laws. Prosecutors argued that Hsia deliberately broke the law to enhance her influence in the Democratic Party, collecting money from "straw donors" who were then illegally reimbursed for their contributions.
Hsia, 48, a Los Angeles-based immigration consultant, showed no emotion during the reading of the verdicts finding her guilty on five charges of causing false statements to be made to the Federal Election Commission.
"This thing is still alive," said defense lawyer Nancy Luque, noting that she has asked the judge to throw out the verdict. "We're not done yet."
Judge Paul L. Friedman did not set a sentencing date and permitted Hsia to remain free on personal recognizance until legal issues are decided. Hsia faces up to 25 years in prison.
During the trial, prosecutors Eric L. Yaffe and John M. McEnany presented testimony from 27 witnesses, including John Huang, the former Democratic National Committee vice chairman and Commerce Department official who played a part in many of the alleged Democratic fund-raising abuses during the 1996 campaign. Huang, who pleaded guilty last August to a federal conspiracy charge, testified about a myriad of dealings with Hsia.
Prosecutors said Hsia passed along money from illegal donors to the Democratic National Committee, the Clinton-Gore '96 effort, and the campaign of Rep. Patrick J. Kennedy (D-R.I.). The donors included the International Buddhist Progress Society, commonly known as the Hsi Lai Temple, a place where Hsia often cultivated business. The temple, in Hacienda Heights, Calif., contributed a total of $95,000 for various campaigns even though it was barred from doing so because it is a tax-exempt religious organization.
One of the five charges involved Gore's April 29, 1996, appearance at the Hsi Lai Temple. A videotape played for the jury showed a gleeful Gore surrounded by monks and nuns. Prosecutors said Hsia turned over $65,000 in illegal contributions to Huang and the DNC a day after the event, disguising the fact that the temple was the source of the money.
Gore has been criticized by congressional investigators for his shifting descriptions of his temple visit. At first he said it was "community outreach." Later he termed it "finance related" and "donor maintenance."
According to prosecutors, the various campaign treasurers had no idea that the money they got through Hsia was coming from prohibited sources. Buddhist nuns, monks and other temple supporters signed checks as individual donors, then were secretly reimbursed by the temple and others.
The names of these "straw donors" were listed by the political campaigns on documents filed with the FEC, and that formed the basis for the government's case.
In closing arguments to jurors, Yaffe said many of the straw donors were "dupes" who had no idea what they were doing. One woman, for example, testified that she thought the check she wrote to the "DNC" might be going to a security company that worked for the temple, not the Democratic National Committee. Others asked no questions, he said. Throughout the trial, Yaffe depicted Hsia as the mastermind of the goings-on, motivated by a desire to impress clients with the clout she was building in political circles.
But the defense challenged that assertion, with Luque telling jurors that Hsia merely passed along checks and had no reason to question their true origin. Luque said Hsia, a naturalized U.S. citizen born in Taiwan, was motivated by the unselfish goal of trying to enlighten political leaders about concerns of the Asian American community.
The Justice Department so far has brought charges against nearly two dozen people, winning 13 guilty pleas from key players such as Huang, Little Rock restaurateur Yah Lin "Charlie" Trie, and California businessman Johnny Chung. Another leading fund-raiser, Pauline Kanchanalak, is scheduled to stand trial before Judge Friedman next month.
The prosecutions have been based on the theory that the campaigns were victims of unscrupulous fund-raisers, misled into filing false information with the FEC. Republicans have protested this approach as a "charade" to shield top Democrats.
Jim Nicholson, chairman of the Republican National Committee, praised the jury's verdict but quipped that, "If Al Gore was a victim of Maria Hsia, then Clyde Barrow was a victim of Bonnie Parker." Rep. Dan Burton (R-Ind.), chairman of the House Government Reform Committee, said, "There is no doubt that the vice president and the DNC were not victims. The vice president just hasn't leveled with the American people."
Attorney General Janet Reno said the verdict "sends a clear message that the Department of Justice will not tolerate violations of our federal campaign finance laws and that we will vigorously investigate and prosecute such violations."
Staff writer Ceci Connolly contributed to this report.