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Hsu’s wallet matched his need to please

Democratic campaigns and charities took Norman Hsu’s money while harboring doubts about his background and behavior.
Norman Hsu, Hillary Rodham Clinton
Norman Hsu, a Democratic fund-raiser arrested last week on a warrant for fraud, was so eager to please that he was racing to become the first person to raise $1 million in contributions for Sen. Hillary Clinton’s presidential campaign, according to three Clinton supporters.Paul Sakuma / AP
/ Source: The New York Times

Norman Hsu was desperate for invitations to glitzy Democratic Party galas in California and private political dinners in New York. But once he got in, Mr. Hsu, a 56-year-old apparel executive, seemed awkward and out of place, almost astonished to be posing for pictures with former President Bill Clinton, Senator Hillary Rodham Clinton and other big-name Democrats.

He gave generously, showering money on a wide array of national, state and local politicians. But he stood out in the symbiotic world of campaign finance because he appeared to want nothing in return other than a few powerful friends, according to Democratic fund-raisers in New York and California who knew him.

What those friends did not know, however, was that Mr. Hsu was running from a 15-year-old arrest warrant for a fraud conviction and a hidden past of bankruptcy. And his political donations helped to bolster his image as a man to do business with.

He was a compulsive name-dropper who even took time to befriend campaign workers, pulling strings to get them reservations at tough-table restaurants like Nobu in Manhattan.

His political activities came to occupy such a central role in his life that when he composed a suicide note last week while running from the authorities, he specified that his funeral arrangements should be handled by a young former Democratic Party staffer who once coordinated fund-raising in New York, although he had not been in touch with her in more than a year.

‘He could walk on water’
Like the deep-pocketed gamblers who are the targets of Las Vegas casinos, Mr. Hsu was quickly recognized by dozens of Democratic campaigns as a soft-touch cash machine, and they tapped into his largesse without investigating the source of his wealth. Mr. Hsu was so eager to please that he was racing to become the first person to raise $1 million in contributions for Mrs. Clinton’s presidential campaign, according to three Clinton supporters who said they were told by Mr. Hsu of his goal. He nearly accomplished it, raising an astonishing $850,000 from 260 people in just six months.

“There came a point in the campaign when he could walk on water,” said John A. Catsimatidis, a New York businessman and top Clinton fund-raiser. “He spent money, he never said no. Very young fund-raising staffers would say, ‘Norman, we need $50,000,’ and he’d say, ‘I’ll do it.’ ”

Interviews last week with more than three dozen fund-raisers, donors, strategists and businesspeople who know Mr. Hsu sketch a portrait of a man who was simultaneously sought after and held at arm’s length, someone whose aggressive generosity was rivaled only by the opacity of his motivations. Campaigns and charities were only too willing to take his money, while at the same time harboring doubts about his background and behavior.

In the national spotlight
Mr. Hsu emerged in the national spotlight in late August when it was revealed that he faced a 15-year-old outstanding warrant in California for a fraud conviction for bilking investors out of $1 million. He had faced a maximum of three years in prison, but he skipped out on the sentencing hearing. After returning to Hong Kong in the 1990s, Mr. Hsu arrived back in the United States 10 years ago and began raising money for new investment schemes.

After the warrant became public, Mr. Hsu surrendered in California and posted a $2 million bond, but he skipped out on a court hearing. While riding a train bound for Colorado, he became ill and was arrested. He is back in custody and a Colorado judge set bail at $5 million.

Although Mr. Hsu has given to numerous Democrats, none benefited more than Mrs. Clinton, and no candidate has more aggressively severed ties with Mr. Hsu. Last week, the Clinton campaign announced it would return the $850,000 raised by Mr. Hsu, the largest sum to be returned by a presidential campaign. The Clinton campaign says it will now examine the background of its big fund-raisers more closely.

The elevated status Mr. Hsu bought through political donations helped him raise money for his investment schemes, even as he raised political donations from some of those same investors — many of whom now fear their money is gone.

A California woman who invested with Mr. Hsu said a member of her family talked him up as “this big businessman who was a big friend of Hillary Clinton.” Mr. Hsu would encourage investors to make campaign contributions because it “was good for business,” said the woman, who asked not to be identified.

Several prominent Clinton donors who spent time with Mr. Hsu recall him as an indefatigable networker, willing to take on any fund-raising need even from low-level Clinton staff members.

“I think he was motivated by a desire to rebuild his identity, his image, and to launder his fraudulent past through Democrats and the Clinton campaign,” said one prominent Clinton donor who attended meetings and socialized with Mr. Hsu and grew to know him personally. “He went from a nobody to a player. And if Hillary was elected, he would go from a player to a well-connected star in Democratic business circles.”

On a superstar track
Indeed, one senior adviser in the Clinton campaign said that Mr. Hsu aspired to and was on track to becoming “one of the break-out superstars of 2008 presidential fund-raising in both parties.” Despite his lofty goal, the Clinton campaign’s chairman, Terry McAuliffe, denied last week that he had pressed Mr. Hsu to raise ever larger sums for Senator Clinton. Still, Mr. Hsu was no stranger to Mr. McAuliffe; he was among the hundreds of people at Mr. McAuliffe’s home for a Clinton fund-raiser in July.

However much Mr. Hsu used his image as a friend of politicians to impress his business contacts, he seemed to have had little difficulty finding people willing to give him money long before he burst onto the political scene. For example, a New York investor who directed $40 million to Mr. Hsu first did business with him in 2002, a full year before Mr. Hsu began making campaign contributions and well before he became a fixture at Democratic fund-raising events.

But once Mr. Hsu entered the political world, he did it in a big way. He lobbied to get invited to marquee fund-raising events, like one for Senator Clinton at the Beverly Hilton co-hosted by filmmaker Steven Spielberg in February, according to one California-based fund-raiser. Sometimes, he would crash private parties without an invitation.

“He wanted to get on the party’s A-list, and he knew it would take a lot of money,” said a prominent California Democratic fund-raiser who saw Mr. Hsu at party events in Los Angeles and San Francisco. “I remember him wanting to know about the next party, the next dinner. He never wanted to be left out.”

The go-to guy
Mr. Hsu became involved in the Innocence Project by walking up to Barry C. Scheck, the defense lawyer who runs the group, in the Gotham Bar & Grill and introducing himself. He paid $15,000 to become a member of the Clinton Global Initiative, the former president’s charitable project, and managed to be photographed with Mr. Clinton and Ethel Kennedy on New York’s Chelsea Piers last October.

Among Clinton aides and advisers, Mr. Hsu garnered a reputation for responsiveness and success. Whether a request came from the campaign’s finance director, Jonathan Mantz, or a junior aide on the Clinton finance team, Mr. Hsu was quick to say yes. He quickly became known as a go-to man with apparently terrific access to ready money in New York and Asian circles, Clinton campaign officials say.

His devotion to Mrs. Clinton was sometimes eye-popping. He threw a dinner party in Mrs. Clinton’s honor this year at the Modern restaurant in the Museum of Modern Art in New York, for about 100 people, costing him roughly $200 a head, according to three people who attended. It was not a fund-raiser; there was no special purpose, except to celebrate Mrs. Clinton, who did not attend.

Yet some Clinton donors say they were sometimes uncomfortable with Mr. Hsu and wish that, in hindsight, they had regarded this ambivalence as a red flag.

One donor said Mr. Hsu often seemed to try too hard. The donor recalled receiving an ornate invitation to a party that Mr. Hsu threw himself this year after a fund-raiser. A California-based Democratic fund-raiser said: “He seemed so desperate to be included in every big-ticket event in California.”“ It was a little sad.”

Web of introductions
Clinton campaign officials and donors, who have looked into Mr. Hsu’s past, described his trajectory this way: He was introduced to political giving by Stanley Toy, a Los Angeles doctor, who at some point introduced him to Mark Gorenberg, a San Francisco-based venture capitalist who was the California finance director for John Kerry’s presidential campaign.

Dr. Toy could not be reached for comment. Mr. Gorenberg was traveling on Friday and unavailable for comment, his assistant said, though he did not return a phone message left at his office earlier last week.

Mr. Gorenberg essentially vouched for Mr. Hsu as a donor and prospective bundler to Mr. Kerry’s fund-raising network in other major regions, including New York, Clinton campaign officials and donors said. There, he proved to be a minor bundler in the long roster of the Kerry presidential campaign’s New York finance chairman, Hassan Nemazee. Mr. Nemazee said that Mr. Hsu appeared to have his own network of donors and friends to tap, even if he only helped bundle a small amount of money.

Mr. Hsu also began contributing large checks to Senate candidates in 2005 and 2006. Officials with the Democratic Senatorial Campaign Committee say Mr. Hsu was never given names of candidates to support, though they say that, from time to time, he would be given notice by staff members about fund-raisers coming up or possible campaigns to become involved with. Officials say that no one person in the campaign committee was a point person for Mr. Hsu.

Joining the Clinton campaign
At some point, Mr. Hsu came to the attention of Mrs. Clinton’s Senate re-election campaign. A low-level staff member, whom the campaign declined to identify, noticed that Mr. Hsu had been a generous contributor. Mr. Hsu was then cultivated by fund-raising leaders including Alan Patricof, Mrs. Clinton’s finance director for that campaign in New York. Mr. Patricof declined to comment, but associates of his insist that Mr. Patricof did not bring Mr. Hsu into the campaign and did not get to know him well.

By early 2007, when Mrs. Clinton began her presidential bid, Mr. Hsu had become valuable enough to join her New York fund-raising leadership team, attending meetings with about 15 to 20 other donors and Mr. Mantz, usually held at Mr. Patricof’s Manhattan offices.

He emerged in recent months as a Hillraiser, the designation given by Mrs. Clinton’s campaign to anyone who raises at least $100,000 a year. There are more than 200 so-called “bundlers” identified by Mrs. Clinton’s campaign, but Mr. Hsu sought to become a super-bundler. The importance of bundlers has grown in importance as campaigns have an insatiable need for money but can raise only a maximum of $4,600 from each individual. So the more friends and associates that bundlers can raise money from, the more valued they become to campaigns.

Even as Mr. Hsu worked to raise his profile with the Clinton campaign, he also spread his money broadly to municipal races in California, governors’ races throughout the country, liberal political action committees and state Democratic Party committees. And for many, he was something of a secret benefactor.

Spreading it around
He gave $3,500 to Emily’s List, a political action committee that supports Democratic female candidates, as well as the maximum allowable donations to three Democratic senators, Maria Cantwell of Washington, Debbie Stabenow of Michigan and, most recently, to Mary L. Landrieu of Louisiana whom the political action committee was promoting.

Ellen R. Malcolm, president of Emily’s List, says she barely recalls him. “She remembers seeing him at some big Democratic events, but he never came to any of our major events,” said Ramona Oliver, a spokeswoman for the group.

Robert Tuke, a Nashville lawyer, was chairman of the Tennessee Democratic Party in 2006 when Mr. Hsu donated $20,000 to the party and gave an additional $12,000 to the campaign of former Representative Harold Ford Jr., who was in a tight race for the United States Senate.

“The check literally came in the mail,” said Mr. Tuke, who noted that it was unusual for someone to give so much money without making some contact with the campaign or seeking some acknowledgment.

“No one got a call from him, no one has a clue about him,” Mr. Tuke added. “Usually people who give that much want some recognition — they were always asking me to get them to meet Harold Ford or, if Bill Clinton were in town, to get some time with him. There was none of that.”

Another prominent fund-raiser based in New York also recently had lunch with Mr. Hsu, in which she recalled that he arrived “incredibly” late and had so many nervous mannerisms that it became hard to follow what he was saying.

The fund-raiser said she had assumed that Mr. Hsu would not want anything from Mrs. Clinton if she were elected president, with the exception, perhaps, of an invitation to the White House. “He wouldn’t ask for anything,” the fund-raiser said. “All he would want is just to be at the White House. He just would want to be treated to the White House.”

This article was reported by Don Van Natta Jr., Mike McIntire, Patrick Healy and Leslie Wayne and written by Mr. Van Natta and Mr. McIntire.