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Democratic Fundraiser Hsu Had Troubled History

Fugitive fundraiser Norman Hsu leaves the San Mateo County jail after posting a $2 million bond, Aug, 31, 2007, in Redwood City, Calif.
Justin Sullivan / Getty Images
Getty Images
Fugitive fundraiser Norman Hsu leaves the San Mateo County jail after posting a $2 million bond, Aug, 31, 2007, in Redwood City, Calif.

The mysterious Democratic fundraiser Norman Hsu remains in a Colorado jail Friday, where he is being held in lieu of $5 million bail. He is expected to return to California soon to be sentenced for a 15-year-old grand theft charge.

Until two weeks ago, Hsu was one of Hillary Clinton's most prodigious fundraisers, bringing in some $850,000 for the New York senator's presidential campaign. Since then, Hsu has run from the law, threatened suicide, and forced the campaign to return all of the money he raised.

Even now, little is known about how Hsu got involved in politics, or where his money came from.

"He just showed up one day, a couple of years ago," said John Catsamitidis, a businessman and Democratic fundraiser in New York City. "He seemed like a very pleasant guy, he was very well dressed, and nobody thought anything of it."

California Roots

On paper, Hsu has some impressive credentials. Born in Hong Kong, he was educated at the University of California, Berkeley and the University of Pennsylvania's Wharton School. In the 1980s, he was featured in the business press as a successful fashion entrepreneur.

But Hsu also has a more ominous paper trail: lawsuits filed by disgruntled investors, a 1990 bankruptcy, and a criminal record for grand theft.

Authorities say at least one of Hsu's California businesses was an illegal Ponzi scheme. He reportedly raised more $1 million from investors for the purpose of buying and reselling latex gloves. Although some early investors did make money, authorities say there's no evidence any gloves were actually bought or sold.

The latex scheme led to a grand theft charge 15 years ago, to which Hsu pleaded no contest. Before he could be sentenced in 1992, he disappeared.

Since then, Hsu has traveled to Hong Kong and back to the U.S. He kept a relatively low profile until he began making a name for himself earlier this decade as a big political contributor.

Political Money Man, or 'Bundler'

Hsu's political contributions began in 2003 and accelerated in 2007. He has personally contributed to 27 congressional Democrats and seven party committees. More than 40 percent of his contributions came this year alone.

He also gave to charities, including the Innocence Project, which re-examines death penalty cases, and the Clinton Global Initiative. He has been a donor and a board member of the New School, a university in Manhattan.

In addition to his own contributions, Hsu helped recruit other political donors, a process known as "bundling." Although campaigns are not required to report bundling totals, Hillary Clinton's presidential campaign says Hsu was one of her very top bundlers, or "HillRaisers," as the campaign calls them.

Fundraiser Catsimatidis says while many bundlers promise to raise big sums, Hsu actually delivered.

"I would say his average was close to 100 (percent). That's why I really like him," Catsimatidis said.

A bundler needs to have persuasion and persistence. Hsu had both. His bundling totals are estimated in the low millions, including $850,000 for Hillary Clinton.

Hsu's motives are not clear. He talked about loving the Democratic Party. But Catsimatidis says he never asked for anything in return, like other bundlers. And he never talked about his business.

A Questionable Garment Business

By the beginning of this decade, Hsu had established himself in the role of a New York City garment executive. His campaign disclosure forms list a half-dozen firms where he supposedly worked as a director, a designer or president. Only two of the firms are registered with New York authorities, though. And only one of the listings is still active.

A woman named Yau Cheng began investing with Hsu in 2001. Her early investments were successful, according to Cheng's lawyer, Seth Rosenberg. Over the next six years, Cheng and a partner recruited other investors, ultimately raising tens of millions of dollars. They were told their money was being used to finance Chinese apparel companies manufacturing goods for high-end retailers, including Gucci and Prada.

As with Hsu's earlier latex venture, though, there are holes in this purported business plan. For one thing, Gucci and Prada say they've never done business with Hsu, or his company, Components Ltd.

The Law Catches Up

The investors began to get nervous when Hsu's old legal troubles resurfaced — especially after he failed to show up for a court hearing in California on Sept. 5, forfeiting $2 million in bail. Days later, when investors tried to cash some of Hsu's checks, they were told the account had insufficient funds, Rosenberg said.

On the run once again, Hsu reportedly sent a suicide note to several associates, then boarded an Amtrak train bound from California to Chicago. He stayed locked in his room so long, a fellow passenger began to worry about him.

"His room — when the train would shift, the curtains would go in five or six inches. And I could see somebody on the floor, wedged," said Joann Segale, who had the train cabin opposite Hsu's.

Segale ultimately called train personnel for assistance, and Hsu was helped off the train in Grand Junction, Colo. Segale says train workers found a bottle of prescription drugs and pills scattered around his cabin.

"He was very ill, very incoherent," Segale said. "But when they picked him up, he said, 'Am I in jail? Am I in jail?' And they said, 'No, you're not in jail. You're in Colorado.'"

Further Legal Woes

Hsu's attorney says he will waive extradition in order to return to California and deal with the old grand theft charge. Meanwhile, investors in New York have asked the district attorney's office to investigate his more recent garment ventures. According to the Wall Street Journal, investors are concerned that $40 million has gone missing.

Attorney Rosenberg won't say whether investors were moved to invest by Hsu's political contributions, or if he ever pressed them to make contributions of their own. Federal campaign records show at least four people connected to the investors' group made maximum contributions to Hillary Clinton's campaign on the same day, March 28.

As suspicion mounted over Hsu's record, Democrats quickly dumped his campaign contributions. Illinois Sen. Barack Obama donated $7,000 to charity, Hillary Clinton donated $23,000.

In addition, Clinton is doing what no presidential candidate has done before: returning $850,000 that Hsu helped raise from other donors.

"It was very difficult for us to make any other decision, other than to return the contributions connected to him, and that's what we decided to do," Clinton said Wednesday, in a conference call with reporters.

The suspicion is that Hsu or someone else may have reimbursed some donors for the contributions, in violation of federal law. The campaign hopes many of the other donors will decide to contribute again.

Copyright 2023 NPR. To see more, visit

Peter Overby has covered Washington power, money, and influence since a foresighted NPR editor created the beat in 1994.
Scott Horsley is NPR's Chief Economics Correspondent. He reports on ups and downs in the national economy as well as fault lines between booming and busting communities.
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