Will Norman Hsu Drop the Other Shoe?
On August 28, the Wall Street Journal published a story that described facts about certain contributions to a certain presidential campaign, facts which are unusual enough that a mildly curious person might reasonably wonder whether the contributors and the recipient campaign were in perfect compliance with law. That the contributing family has a Chinese surname and the donee is Hillary Clinton’s campaign guaranteed that the story would get a lot of attention, because it reminded, well, everybody of the last big campaign finance scandal involving Chinese people and the Clintons. (For you history junkies, the Washington Post has conveniently organized its stories from the old scandal.)
Notwithstanding quick responses from a couple of lefty blogs that the WSJ‘s story contained no actual allegation and sustained its innuendo only because the donors in question had Chinese names, the story accelerated on August 29th. The Los Angeles Times reported that Norman Hsu –a top Democratic fundraiser and the apparent moneybags positioned between the various unconnected dots in the original WSJ article– has long been a fugitive from a grand larceny conviction in California, undetected by law enforcement despite numerous high-profile appearances at Democratic fundraisers over the years. In the wake of this unfortunate news, John Kerry, Barbara Boxer, Al Franken and other Democrats who had taken money from Hsu announced they would give it back or donate it to charity, and finally Hillary Clinton said she would do as well. The question now is whether the speedy retreat will make the story go away.
The substance of the story remains fairly thin, even if embarrassing for Democrats. The WSJ reported that “[o]ne of the biggest sources of political donations to Hillary Rodham Clinton is a tiny, lime-green bungalow that lies under the flight path from San Francisco International Airport.” The six members of the Paw family who live in that bungalow have given $200,000 to Democrats since 2004, the first year that any Paw gave money in any political campaign. Of that money, $45,000 went to Hillary Clinton’s various campaigns for senator and president.
The Paws gave to many of the same campaigns as Norman Hsu, and Hsu once listed the Paws’ house as his address. One of their sons, Winkle, who purports to be a successful investor (the article does not say whether he is the son who is “an executive at a mutual fund”), admits that Hsu has asked him to contribute to political campaigns from time to time, and that he has asked his family members to do so.
The Wall Street Journal made much of the Paw family’s modest home, referring to the “dilapidated” garden and the “din” of the nearby freeway. Mr. Paw makes less than $50,000 as a mail carrier, and the family runs a gift shop. With the exception of the money manager, none of the children are obviously affluent.
The facts reported so far can be assembled into quite different malign and benign stories, both of which are essentially speculation.
The malign version is that Hsu, a fugitive from justice who once listed the Paw home as his address notwithstanding his residence in New York, has been laundering illegal contributions through a working-class family that does not appear to have the wherewithal or the inclination to give huge (for them) amounts to Democrats around the country.
The benign version is that Hsu, an ambitious guy with a past that is only mildly shady by Marc Rich standards, has over many years built a huge network of affluent people who want to give money to Democratic campaigns. One of those contributors was Winkle Paw, who multiplied his own leverage by rounding up his parents and siblings.
The benign version does not deal with Hsu listing the Paw’s home as his address, but that might well have been a transcription error in the filling out of forms. Hsu bundles together checks from lots of people to get the most “credit” from the campaign, a virtually universal practice in the raising of political money. If he had lots of checks and lots of forms to fill out, one can easily imagine putting one person’s address on another’s form.
There is no evidence, yet, that any of the money putatively contributed by the Paws came from Hsu, foreigners, or otherwise from outside the Paw family. Nor is there any evidence that the donee campaign organizations knew of or suspected a violation of law.
The evidence is thin enough that the story will die unless new facts turn up or a government agency opens an investigation. Clinton’s Democratic rivals will not want to make a big fuss because Hsu has raised money for many Democrats, including Barack Obama. The Republicans can barely choke their own talking points out between sex scandals, much less bother to hammer at Hillary almost a year before the general election campaign begins. No, the Democrats are in the clear on this unless either the donated money actually did come from China or it turns out that an important Democrat knew that Hsu was a fugitive or was breaking the campaign finance laws.
How would we learn about either of those things? When an ambitious prosecutor squeezes Hsu into pointing the finger at a bigger fish.
TigerHawk is the pseudonym of a middle-aged executive who lives in Princeton, New Jersey. He is also the founder of the blog of the same name, a lawyer of sorts, a former “Benedict Arnold CEO,” numismatist, father of teenagers, husband, dog-lover, horse-financier, and general factotum.
I would think the IRS would be interested in how the Paws were giving away a load of cash that seems to be larger than their income. In addition to election infractions, it would seem there is the possibility of both tax evasion and money-laundering here.
The Devil himself would come out second in any dealings with a Clinton.
There is no evidence, yet, that any of the money putatively contributed by the Paws came from Hsu, foreigners, or otherwise from outside the Paw family.
Sure would be interesting to see a bank statement comparison, though, wouldn’t it?
I wonder…if this was a Repub scandal, would there be a small army of reporters grinding out leads and bits of information?
That’s the other way (besides gov’t investigation) that the story would grow legs.
According to Zillow.com, a house just down the street, likely to be identical to the Paw’s, sold for $660,000 this April. (Daly City was the town Malvina Reynolds was singing about in “Little Boxes”.) It’s only 1280 sq.ft., and next to the freeway, and probably has zero side yards, but it’s still worth $500/sq.ft.
That refinance the WSJ mentioned could have been a cash-out refi, where they ended up with a larger loan and a pile of cash, to donate to the Clintons. But why?
The fact that so many Asian donors fled overseas under suspicion screams for an investigation.
Now that that the Clinton/Chinese donor connection comes alive again should raise concern.
Clearly it’s possible that the father refinanced the house and for whatever reason, him and his wife gave the maximum amount to the democrats. And one kid probably could afford it. But all of them? And who refinances and gives that big a chunk of money away? As to if a high ranking Democrat thought there was something fishy, I would bet not. I imagine they take care NOT to know. I also imagine the same care is taken on the Republican side. It would be very interesting to know the truth on this though.
If Hsu didnt reimburse the Paws and everything is legal… sounds like a smear campaign to me from someone who wants Hsu to go away.
Also unclear, in either version of the story – where is Hsu getting HIS money from? Even if we assume the Paw family money is all from Winkle’s success, Hsu is giving Democrat candidates $50k per year with no visible means of support.
Mr. Beaumont, you are right on target….!!
Squeezing Hsu is as easy as it gets if the governmnet is so inclined:
1. Take him back to California in shackles.
2. Sit him down and tell him that:
- He’s getting the full three years he owes on his no contest plea to theft;
- He’s getting charged with bail jumpng and getting a consecutive sentence if convicted;
- He’s getting federally prosecuted for flight across state lines for the purpose of avoiding prosecution;
- We’re taking your passport(s)
3. Tell him that most (but not all) of the above will go away if and only if he tells all about his clearly obvious money laundering schemes.
ANYTHING short of this is a half measure designed to avoid getting to the bottom of a huge scandal in American politics.
Winkle Paw gave $3K to AG Jerry Brown on 23 Nov 2005. Curiously, no mention of this has been made by Brown’s office, even though he is responsible for prosecuting Norman Hsu (an associate of Winkle Paw’s).
The Cal Atty Genl office will go easy on Hsu in order to accommodate the DNC. It’s interesting that the bail agreement between Brown’s office and Hsu was rejected by the judge who then doubled the amount.
Bail should have been denied. Hsu is an obvious flight risk.
What are the chances of a prosecutor from Marin county pursuing the real sources of this money?
As A.B. Stoddard told Tucker Carlson, this story could “bring her down.”
1. NY Times reports and others have yet to find a source for Hsu’s money. His business are shams, phony addresses, mail pick-up shared offices. Where did he get the $2 million to make bail even?
2. Finding out about Hsu was NOT difficult. If Clinton didn’t know about him, it was because she wanted to take the money and this character was a top fundraiser. News reports say that commonly used data bases turned up that he was kidnapped and filed for bankruptcy in San Mateo Cty and from there its a simple criminal records check.
3. The New School angle – Bob Kerrey made Hsu a trustee and named a scholarship fund after him without knowing anything about the man. Clearly, its distasteful that people at the level of Clinton and Kerrey will smile and pander for someone just for the money. It looks terrible.
4. Bernard Schwartz (Loral – see 1996 Clinton scandals) is also a trustee at the New School. Coincidence or is he the one who brought Hsu in initially?
Hillary talked about distinguished persons in her “speech” this last weekend, yet what Distinguishes Mrs. Clinton is her recurring underhanded activities and self serving acts. When considering the next President, the candidate should be above all else willing to serve others, not an ENTITLEMENT candidate with little to actually show. And above all else, there should be an honest list of real qualifications for the hardest job in the world!
Why to charity? although that is laudable. I seems to me all the tained contributions should go to those victimized in the rubber glove ponzi scheme.