Before Norman Hsu became a household name and right around the time his Ponzi scheme that would eventually lead to his being sentenced to 3 years in prison began to fall apart, he found himself in fear for his life in the back seat of a car with Raymond Kwok Chow, alias “Shrimp Boy,” and a known lieutenant of perhaps the most powerful gang leader in Chinatown; Peter Chong.
Chong came to American in 1989 from Hong Kong with the sole purpose of establishing an American off shoot of the powerful Wo Hop To Triad in which he was one of the major figures. Upon his arrival, he sought out Chow who headed up the Hop Sing gang and was eager to attach himself to one of the major criminal organizations in China. Chow’s gang had been chased out of Chinatown a decade earlier when the Wah Sing gang, run by Danny “Ah Pai” Wong, claimed the streets for themselves.
On the day that Norman Hsu was either being kidnapped or, if you believe Chow, was in the car as the result of a call from Hsu for help because extortionists were after him, the Foster City police stopped the vehicle for running a red light. The story Hsu told the police is interesting:
Hsu told police he had been kidnapped.
“There was a 12 hour ordeal where there was discussions, arguments. Mr. Hsu claims he was assaulted several times and threatened,” said Capt. Matt Martell, Foster City Police Department.
Hsu told police he had business dealings with Chow and there was a dispute over money.
“And what that dollar amount was, different dollar amounts ranged between $300,000 and a $1 million worth of claims,” said Capt. Martell
Chow says Hsu lied, and claims it was Hsu who called him for help that night because he owed people money.
“I met him because he was in trouble, and at that time, I helping him out a lot,” said Chow. “The way he told me, I mean, he being extortion, he being a lot of people tried to hurt him.
Chow and the others were arrested, but charges were later dropped when Hsu became uncooperative with prosecutors.
What was Hsu doing borrowing money from Chow? What was a seemingly respectable businessman doing business with Wo Hop To?
Wo Hop To, according to the US government, is one of several dozen loose knit Asian criminal enterprises investigated by the FBI in the United States. In Hong Kong, where the Triads are illegal but nevertheless retain a high public profile and are very powerful, Wo Hop To is known for its ties to gambling, prostitution, and most notably, protection rackets. If Hsu was being pursued by investors into the very Ponzi scheme that landed him in trouble, he could do no better than seek out the protection of a powerful Triad gang.
Just what kind of “service” would Chow provide? Hsu evidently approached Chow himself:
This was when Chow says he met Norman Hsu. He says Hsu dabbled in clothing, import and export and real estate. He adds Hsu was also in trouble.
“I guess he into a lot of financial problem back then and I loaned him some money,” said Chow. “And I help him with my knowledge and with my strength. That’s all there is.”
Helping Hsu with his “strength” could very well mean that Hsu asked Chow to intimidate investors into not going to the police about his Ponzi scheme. We saw above what a little intimidation could do when Hsu refused to cooperate into the investigation in his own kidnapping.
And if the Triad loaned $1 million to Hsu (reading this long profile of Chow makes it clear he personally did not have that kind of money), what were they expecting in return? If Hsu needed it to pay off investors in order to keep the Ponzi scheme running a little longer, surely the Triad would want a piece of any future action Hsu was able to drum up as far as new investors. In short, it appears that Hsu had gone into business with the most powerful Triad in the United States and a gang that the FBI said rivaled the mafia in sophistication.
So the “kidnapping” could be as Raymond Chow described it; they were protecting Hsu from angry investors, some of whom may have been trying to extort money from him in exchange for their not going to police about Hsu’s con games.
What relevance does all this have to Hsu’s fundraising activities for Democrats?
Either coincidentally or by design, following the fund raising scandals of the 1990’s, the Chinese Communist party forbade the Peoples Liberation Army (PLA) from engaging in any business activities. Previously, the army seemed to have a piece of every commercial pie and extracted profits in which they enriched themselves and Chinese officials who were paid to turn the other way with regard to some of the shadier dealings.
As part of those dealings, the Chinese military evidently tried to influence the Clinton Administration to go lax on export licensing agreements that didn’t allow certain sophisticated technology to be transferred to a potential enemy like China by funneling money to the Democratic party through several conduits. There also appeared to be an effort by the Chinese government to influence legislative and state elections as well.
Now that the PLA is prevented from owning businesses that could lobby for relaxed restrictions on high tech items they might like to buy, how would the military go about replacing that influence?
But previously, the Chinese army, like the queen of England, did not need the triads’ crooks to conduct its dirty business, it could do it itself. Any state conducts covert operations through its secret services, performing a vital role for national security, but these activities, conducted by agents and sanctioned by the top political leaders, are for the good of the state, not for that of a small gang.
For practical purposes it is important to distinguish between “dirty activities” conducted directly by a political institution and “dirty activities” conducted indirectly by a political institution through professional independent crooks. Without this difference everything is crime (or vice versa nothing is crime) and we get nowhere: crime overwhelms us. We need clear-cut, reachable objectives, which must be limited in scope and thus in time, otherwise the Mafia stops being a law-and-order issue and becomes a metaphysical force spanning thousands of years of history, as the Mafiosi and triad members like to describe their organizations.
Thus, Hsu’s flight to Hong Kong makes sense. In that city, and with his connections to Chow and Peter Chong, it would have been easier to set himself up in business by tapping sources like Wo Hop To. Otherwise, how would one explain a bankrupt, nearly penniless businessman landing on his feet in the most expensive city in the world? And how would Hsu repay the Triads their generosity? By moving funds into American campaign for one of the Triad’s major customers, the PLA perhaps?
Interesting speculation – which is all it is. But I don’t think the Triad connection to Mr. Hsu can be dismissed at this point. He probably did business with them in the past. And given the fact the sources of his money remain a mystery, it could very well be that he is doing favors for them today.