Now that the Wall Street Journal has made their article on the Hsu swindle of Source Financing Investors available for free, we can see the scope of the grifter’s con of Joel Rosenman is absolutely incredible. I may have been right when I speculated that Mr. Hsu’s entire life was one big Ponzi scheme.

Mr. Rosenman’s partner, Ms. Cheng, met Mr. Hsu while working for an Internet company in 2000. She began investing in one of his businesses and made a profit, according to someone familiar with the matter. In 2002, she joined JR Capital and introduced Mr. Rosenman to Mr. Hsu. That year, Mr. Rosenman invested and also made a profit. He began telling friends and relatives about the investment opportunity.

Mr. Rosenman described the deal in a pitch letter he provided to prospective investors for Source Financing Investors, which he launched in 2005. The investment pool would “lend to U.S. private label designers that needed interim financing to fill orders for a select group of well-known, high-end U.S. apparel retailers.” Since 2001, he writes, “the return of these short-term (typically 4½ months) loans has been no less than 40%.”

That last bit about a 40% return on the investment was pure hooey. It was Hsu up to his old tricks of paying off early investors by victimizing later ones. The idea was to appeal to simple human greed – a get rich quick scheme that seemed to work. The early investor’s excitement would lead him to tell a lot of friends about the “opportunity” and, in Rosenman’s case, even set up an investment company to unwittingly assist Hsu with the scam:

Mr. Rosenman described the deal in a pitch letter he provided to prospective investors for Source Financing Investors, which he launched in 2005. The investment pool would “lend to U.S. private label designers that needed interim financing to fill orders for a select group of well-known, high-end U.S. apparel retailers.” Since 2001, he writes, “the return of these short-term (typically 4½ months) loans has been no less than 40%.”

In a “step-by-step” outline of a typical transaction prepared for investors, Source Financing describes the way a deal worked with Mr. Hsu. Source Financing would agree to provide bridge loans for seasonal high-ticket, high-quality retail goods made in China for exclusive brand names, according to investors. Mr. Hsu told the company that he would obtain from Chinese manufacturers a price quote for apparel production. He would then add a mark-up and give the quote to a high-end buyer in the U.S.

If the U.S. buyer accepted, according to the outline, Source Financing would transfer by wire what Mr. Hsu said was 80% of the necessary loan, with Mr. Hsu saying he would provide the other 20% himself. Mr. Hsu told the investors he would then receive a letter of credit from a Chinese bank and that the manufacturer would ship the apparel to the U.S., where Mr. Hsu would deliver it to the merchant.

That Hsu must be a fast talker. I’m no investment expert but does anyone else see where an investor could get screwed 6 ways from Sunday? The deal is dependent on a rickety house of cards indeed. And how much do you want to bet that some if not all of those “US buyers” who accepted those quotes were shell companies set up by Hsu in order to fool investors everything was on track!

But this to me, would have been the biggest “tell” that something was amiss:

Mr. Hsu would give the investment firm a check, post-dated for 135 days beyond the wire transfer, for the amount of the loan plus profit. When the check matured, Source Financing would deposit it and allocate the money to investors. The company that would carry out these transactions, Mr. Hsu told investors, was Components Ltd., set up in 1997.

Some investors in Source Financing said they got involved through friends who knew Mr. Rosenman. Some did not know who Mr. Hsu was until news about him broke in late August.

Again we see the power of greed at work here. What possible guarantee is a post dated check? It is a worthless piece of paper until the date it can be made good. If Hsu was going to skip out – as he evidently was doing – what possible good would a post dated check be? It still came down to Rosenman placing his full faith and trust in Norman Hsu – his biggest and most tragic mistake.

I may be off base with this and if someone can give me a rational explanation why any sane businessman would think that accepting a post dated check in a deal like this would protect him somehow, I’m open to hearing it.

It is doubtful that Hsu fulfilled any of the promises he made about the deal – the exact same thing he did for 1/40 the amount of money in 1991 in the latex glove scam. No clothing manufacturers were contacted. No letter of credit from a Chinese bank. No product at all. Hsu was able to succeed in his con the way that all grifters make a living; feeding off the avarice of their marks.

As I said in the post below, Hsu is a first team all American crook. I look forward to more revelations about his swindles so that before long, he may be inducted into the Con Man Hall of Fame.

The Wall Street Journal has partially solved the riddle of where Norman Hsu got the money he used to donate substantial sums to Hillary Clinton’s Senatorial and Presidential campaigns as well as numerous other Democratic candidates.

Joel Rosenman, the producer of the Woodstock rock concerts in 1969 and 1994 gave Hsu’s company an astonishing $40 million “investment” with which Mr. Hsu has apparently absconded: (WSJ Subscription required):

New documents reviewed by The Wall Street Journal may help point to an answer: A company controlled by Mr. Hsu recently received $40 million from a Madison Avenue investment fund run by Joel Rosenman, who was one of the creators of the Woodstock rock festival in 1969. That money, Mr. Rosenman told investors this week, is missing.

In a letter this Monday, Mr. Rosenman told investors that the 37 outstanding deals with Components Ltd. are set to mature “over the next four months.” But he indicated that was not likely. He said he had deposited two checks from Components that “matured Sept. 7.” He was informed by the banks that there were insufficient funds.
“This development, coupled with recent revelations,” he wrote, “led us to believe that payments due on our recent transactions with Components and Hsu may not be made.”

Forty million dollars? This fellow Hsu must have a golden tongue with an uncanny knack of separating people from their money. And I think it is obvious we underestimated his abilities. Norman Hsu is not some run of the mill grifter. He is a superstar in the world of con men; a first class, top of the line, first team all American crook.

No word on exactly when Rosenman invested this money with Hsu but the Journal article mentioned it was “recently.” If so, that hardly explains the great bulk of donations Hsu has made to Democrats going back at least 3 years. How many others has Hsu bilked? And is his entire life one big Ponzi scheme where he scams mark after mark, using the proceeds from his most recent victims to pay off some of the past investors?

There is nothing “common” about this criminal. Which brings up several troubling questions that few seem to be asking at the moment:

Hillary Clinton’s campaign couldn’t explain yesterday why it blew off warnings about felon-turned-fund-raiser Norman Hsu – and the Daily News learned FBI agents are collecting e-mail evidence in the widening scandal.

Clinton was forced Monday to give back a whopping $850,000 raised by convicted scam artist Hsu after learning his investment ventures were being probed by the FBI as a potential Ponzi scheme.

She earlier gave to charity $23,000 Hsu donated himself after reports revealed he fled sentencing for a $1 million scam in California in 1992.

Yesterday, the campaign insisted it did all it should to vet Hsu after California businessman Jack Cassidy warned in June that Hsu’s investment operation was fishy. Cassidy e-mailed his tips to the California Democratic Party, which forwarded them to the Clinton campaign.

We should also be asking questions about Mrs. Clinton’s security. How could the Secret Service let someone like Hsu within 50 yards of Hillary? Or were their objections overridden?

But the question the Justice Department is going to want answered is who in Mrs. Clinton’s campaign knew about the Cassidy warning and then failed to adequately vet Hsu’s shady dealings? Or, more troubling, discovered Hsu’s history and still took the money anyway.

Meanwhile, See Dubya at Hot Air has dug into Clinton’s donor list and pulled out several contributions from Rosenman’s family as well as others connected with his investment company:

Source Financing, Mr. Rosenman’s company, has asked the beneficiaries of Mr. Hsu’s largesse to quit giving it away to charity in order to recover it for their investors.
No word on whether Mr. Rosenman wants his own contributions to Hillary back, nor those of a Ned Rosenman who also works for Source Financing, nor those of a Molly Rosenman, also of Source Financing–each of whom gave her $4600 back in March.

Mr. Rosenman’s partner, a Mr. Yau Cheng also donated $4600 to Hillary. See Dubya asks whether all of these checks were part of a bundle delivered by Hsu to the Clinton campaign. In fact, there were 260 individual donors whose checks were bundled by Mr. Hsu. Malkin rightly calls on Hillary to come clean and cough up the list. She’s already returned $850,000. Why not make the names public?

Timing will be critical in this case. When did Hsu receive the $40 million? All the donations from Source Financing were made in March of this year. Was there some kind of understanding between Rosenman and Hsu about part of that $40 million when repaid offered as reimbursement to donors scared up by Source Financing? Was more of that $40 million earmarked for political donations to Democrats? How many operations like this exist to get around FEC regulations?

This could be the biggest election financing fraud in history, even surpassing the Nixon crimes committed during the 1972 election.

Some of the questions about the source of Norman Hsu’s largess spread around the country to Democratic candidates have been answered. But as in all scandals, each question answered raises additional problems. This is a very serious scandal for the Clinton campaign, one that could even sink her candidacy even if it doesn’t touch Hillary directly. And depending on how extensive the lawbreaking was, it may pull down the Democratic party a notch or two nationally.

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.

Several authors and investigators have linked the PLA with the Triads for so-called “dirty activities” including the funneling of money to American campaigns.

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.

Norman Hsu is a fugitive no longer.

Taken ill on a train outside of Grand Junction, Colorado, Hsu was whisked away to a hospital with an undisclosed ailment. Somehow, authorities found out about it and Hsu was taken into custody:

Authorities received a request for medical assistance at the train station at about 11:15 a.m., but the exact nature of Hsu’s condition was unclear, Chavez said. Staff at St. Mary’s Hospital declined to comment.

FBI spokesman Joseph Schadler said Hsu will be returned to California on the 1992 conviction once released from the hospital.

Hsu’s attorney told state prosecutors that Hsu had been on a charter flight that arrived at Oakland International Airport at about 5:30 a.m. Wednesday and then dropped out of sight, said Gareth Lacy, a spokesman for the state attorney general’s office.

Amtrak’s California Zephyr train offers service from nearby Emeryville to Grand Junction before heading to Denver and Chicago. The Zephyr left Emeryville at about 7:10 a.m. Wednesday and was scheduled to arrive in Grand Junction before noon Thursday.

Hsu’s disappearing act seemed to be a reprise of a move he pulled 15 years ago, when he failed to show up for sentencing in the same grand theft case. Hsu was facing up to three years in state prison, a $10,000 fine and restitution payments after pleading no contest to a single count of grand theft in what prosecutors described as a $1 million fraud scheme.

But while free on bail after his plea, Hsu dropped from sight for 15 years, apparently spending time in Hong Kong, the Philippines and Taiwan, only to emerge in recent years as a seemingly wealthy New York resident who donated generously to Democratic political campaigns, regularly attended fundraisers and was photographed with party leaders.

What are the chances that our little Hsu bird will sing?

The feds are going to drop the charge of fleeing prosecution immediately upon his return to California. I’m no expert but isn’t that kind of dumb? Wouldn’t you want to hold that over his head in exchange for some answers on his federal fundraising activities? Of course, there are the state charges, but that depends on the California authorities agreeing to cooperate – not a foregone conclusion by any means. One would think there would be a lot of pressure from Democratic politicians not to look very closely at Mr. Hsu’s work on behalf of the Democratic party. If so, then the California prosecutors would be less than enthusiastic to cooperate with the feds in some kind of plea arrangement where Hsu gets a reduced sentence in return for telling the feds all he knows.

Highly speculative at this point but what this guy has in his head may not only affect the race for President but may also have foreign policy implications. If, as many suspect, Hsu was acting as a bagman for a third party – perhaps the Chinese or even the Taiwanese – the major question we would want to know the answer to is what this third party was going to want in exchange for these contributions.

Then there’s the possibility that Hsu is pretty much what he says he is – a guy with lots of money who likes to make contributions to Democratic politicians. Where did he get the money? He could be, as his record indicates, a professional con man, a grifter who worked his way across Asia for 15 years taking down one mark after another. The article in the Chronicle reports he was known to have been in not only Hong Kong, but also the Philippines and Taiwan. Were overseas authorities aware of his ponzi schemes and perhaps other con games?

You can bet before Hsu opens up about the source of his wealth as well as any possible quid pro quos he may have had with politicians, he will have an ironclad deal signed, sealed, and delivered by the US attorney. That aspect of the case will probably take a while so I would expect it will be a few weeks before the inevitable leaks and off the record reports of what Hsu has to say will be forthcoming.

In the meantime, the Democrats will probably be on pins and needles as much as the Republicans were in the Abramoff scandal.

UPDATE: SOME QUESTIONS ANSWERED

The Washington Post has some interesting background on Hsu and has dug up some possible sources for the money he gave to Democrats:

Facts about Hsu are hard to come by. Twenty-year-old clippings from apparel industry publications say he was born and raised in Hong Kong and arrived in the United States in 1969 to attend the University of California at Berkeley. The computer science major went to the University of Pennsylvania’s Wharton School for an MBA. In 1982, with a group of Hong Kong-based partners, he formed Lavano Sportswear.

The business went bankrupt. Describing that time to a Bay Area newspaper, Hsu said he was young and “made a lot of stupid mistakes.” But Hsu moved on to form a series of new clothing ventures before going back to Hong Kong, from 1992 to 1996, for unknown reasons. Returning to the United States, Hsu invested in several new wholesale apparel and import ventures that collectively generate about $2 million a year, according to Dun & Bradstreet estimates.

Nice business pedigree. And that raises the question of why a Wharton MBA would be pulling ponzi schemes to defraud investors?

Also, the Post story only takes Hsu’s foreign travels into 1996. He evidently returned home just in time to become tangentially involved in the Johnny Trie fundraising scandal whereupon he once again disappears only to emerge in 2003 hosting an event for John Kerry.

What the Post article does is show that it is possible Hsu is, if not a legitimate businessman, someone who was donating his own money to campaigns and not acting as an agent for anyone else.

But it is also possible that the opposite is true as no evidence has been found that he could have amassed the kind of cash necessary to invest in businesses here in the US that would be bringing him $2 million a year in income.

It’s no longer a question of “Who is Hsu” but rather “Where in the world did this guy escape to?”

California businessman Norman Hsu, a former New York apparel executive and major contributor to Democratic candidates and causes, failed to appear for a bail reduction hearing Wednesday, leading to speculation that he again is a fugitive from the law, FOX News has learned.

Hsu’s attorneys say they do not know his whereabouts, and that their client did not surrender his passport.

A little more from the LA Times:

Hsu’s attorney, James Brosnahan, explained that he had lost contact with Hsu and that the financier had failed to deliver his passport as promised.

“Mr. Hsu is not here and we don’t know where he is,” Brosnahan said outside court. “We expected him to be here.”

Brosnahan told Foiles that a legal assistant for his law firm went to Hsu’s New York City condominium last week and spent 90 minutes searching for Hsu’s passport.

Well, that’s just peachy. His defense team has known for a week that his passport is missing and didn’t bother to tell authorities? Especially given this guy’s past history of skedaddling when the heat is on?

That leaves the investigation with basically nothing. The Paw family – who acted as a blind for Hsu’s numerous contributions – probably don’t know much even if they were in a mood to talk. Investigators may track down other donors but it is equally unlikely they could be any more helpful than the Paws.

So the story will die and Hillary is safe. Funny how this kind of thing always happens to the Clinton’s just in the nick of time.

Malkin has updates and reaction.

More tidbits of information are being gathered by an aroused press corps about former fugitive Democratic financier Norman Hsu that would seem to suggest some rather strange and significant connections in his past.

This Los Angeles Times piece provides the shockers of the day:

The most obvious red flag: A check of a commonly used database produces a 1990 San Francisco Chronicle news story detailing how Norman Hsu had been kidnapped by gang members in the San Mateo County suburb of Foster City. A second widely used database discloses that Norman Yuan Yuen Hsu of Foster City had a bankruptcy in 1990.

Having established that he lived in San Mateo County, a check of the San Mateo County Superior Court’s website reveals that Norman Yuan Yuen Hsu had a criminal case.

“Kidnapped by gang members…?” And he lived to tell the tale? What kind of gang? The Wall Street Journal fills in the details:

In 1990, the San Francisco Chronicle reported that a group of Chinatown gang leaders had been arrested for kidnapping Mr. Hsu. The article said the alleged kidnappers were stopped after speeding through a red light, and Mr. Hsu took the opportunity to tell police he was being kidnapped. The article said he owned a restaurant and clothing businesses throughout the San Francisco Bay Area.

Some of the Chinatown Triads have ties to legitimate Chinese businesses like the state owned China Ocean Shipping Company (COSCO) which has a history with the People’s Liberation Army. COSCO has subsidiaries all over northern California and has been allegedly involved in smuggling arms to gangs here in the US.

I bring up COSCO because as an importer, Hsu would have been familiar with such a large shipping concern and may have even done business with them.

No doubt Hsu was extremely lucky if he really was being kidnapped. We can only speculate on the reason for his kidnapping but it could have had something to do with a refusal to pay “protection” or even a failure to hire a gang member to work at one of his businesses.

Or, Hsu himself could have been a member of a rival triad.

And the fact that Hsu claimed bankruptcy in 1990 and then emerges 2 years later as Managing Director of Newton Enterprises Ltd in Hong Kong is also rather amazing. As is the news that he evidently never made restitution to the investors he swindled:

In a separate matter, Mr. Hsu turned himself in at State Superior Court in California, where he faced three years in jail before vanishing in the early 1990s. Mr. Hsu had raised more than $1 million from investors to import latex gloves from Asia and resell them for a profit, according to Ronald Smetana, the deputy California attorney general who handled the case.

James Brosnahan, an attorney for Mr. Hsu, released a statement saying his client “has pledged to deal forthrightly with this 15-year-old legal issue” and “is having preliminary productive discussions with the Attorney General’s office.” He added that Mr. Hsu “is hopeful that the matter will be resolved shortly to everyone’s satisfaction.”

Mr. Brosnahan said the $2 million bail “can also be used for restitution to any persons who might still be unpaid.”

According to the article, there are at least a few investors swindled by Mr. Hsu who didn’t receive restitution. Along with his 1990 bankruptcy, one of the legitimate questions being asked by the Justice Department in their probe into Mr. Hsu’s activities must be where did he get the money? One would think that his assets were frozen as a result of the verdict in his criminal trial. Judging by the property he has owned in New York City since his return from Hong Kong, his fortune must be considerable. And while there is no doubt the “Managing Director” of an import company might receive a considerable salary, it is unlikely that it would have been enough to allow for the multi-million dollar property deals he cut upon his return to New York City.

For once, the smell of a good story has overridden the reluctance of the press to cover a Democratic party scandal. We’ll see how far they go when more information about Mr. Hsu is discovered.

UPDATE

Just noticed something strange in that Wall Street Journal account of Hsu’s kidnapping. The report from the San Francisco Chronicle apparently mentions “gang leaders” in the car that supposedly kidnapped Mr. Hsu.

Why would the leaders of gangs be cooperating in a kidnapping of some nobody? More bizarre yet, why would gang leaders be doing their own dirty work? One would think that the leaders of gangs would avoid taking on such tasks for the very reason they made the paper; the chance of getting caught.

This raises the possibility that Hsu was not being kidnapped at all but was being escorted to a gathering of some kind involving all of the Chinatown gangs. Could Hsu himself be one of those “gang leaders?”

Just asking…

Bizarre times we live in, no doubt about it. While the left obsesses over the bathroom antics of a relatively obscure Idaho senator and the social right gets their opportunity to wag a finger in disapproval at the hapless hypocritical closet case, a genuine scandal involving a Democratic fundraiser who has donated hundreds of thousands of dollars of his own money and raised hundreds of thousands more all for Democratic candidates perks along growing stranger by the hour.

Norman Hsu is a man with apparently no known source of income who also may have knowingly tried to skirt campaign finance laws. At the very least, questions should be asked by the FEC about various business addresses given by Mr. Hsu on his disclosure forms, all of which lead to dead ends. Various companies Mr. Hsu claimed to be operating do not exist now nor is it clear that they ever existed at all.

Investigators believe that after Mr. Hsu skipped his court appearance in 1992, he went to his native Hong Kong and then continued working in the garment trade. At some point, Mr. Hsu, a naturalized American citizen, returned to New York and in 2003 made the first of what became hundreds of thousands of dollars in contributions to Democratic campaigns around the nation.

People who met him said they knew only that he ran an apparel business. Efforts to learn more about his trade hit dead-ends yesterday. Visits to companies at addresses listed by Mr. Hsu on campaign finance records provided little information. There were no offices in buildings in New York’s garment district whose addresses were given for businesses with names like Components Ltd., Cool Planets, Next Components, Coopgors Ltd., NBT and Because Men’s clothing — all listed by Mr. Hsu in federal filings at different times.

At a new loft-style residential condominium in SoHo that was also listed as an address for one of his companies, an employee there said that he had never seen or heard of Mr. Hsu. Another company was listed at a condo that Mr. Hsu had sublet in an elegant residential tower in Midtown Manhattan just off Fifth Avenue, but an employee there said Mr. Hsu moved out two years ago, after having lived there for five years. The employee, who was granted anonymity because he was not authorized to talk about residents, said he recalled that Mr. Hsu had received a lot of mail from the Democratic Party.

Could the People’s Liberation Army in China be up to their old tricks of trying to buy influence in the Democratic party?

Here’s a fellow who never gave a dime to a political campaign before returning from Hong Kong 4 years ago. With no known source of income and some demonstrably confusing – perhaps even shady – FEC disclosure practices, the entire matter is beginning to stink of some kind of slush fund. Hsu could be a front man for some other fundraiser. Or he could be a foreign agent. But at this point, it is fair to say he is not who he claims to be.

You might recall the 22 individuals – many of them prominent Clinton-Gore intimates and supporters – who were convicted of fraud or funnelling Asian money into the 1996 campaign. It was a massive effort by the PLA to influence the Clinton Administration and steer hardware and technology – some of it on a restricted list from the Department of Commerce – to the PLA. Corporate fundraisers like the Loral Corporation were allowed to transfer restricted satellite and missile technology to the PLA while other security controls on trade with China were either enforced in a lax manner or thrown out the window altogether.

Of course, it was impossible to prove that the Clinton Administration had been bribed by the PLA but the inference was plain as day. In exchange for contributions to the Clinton campaign, his presidential library, and his personal legal defense fund, the Chinese got access to restricted technology and hardware. It was one of the the biggest (and most underreported) campaign financing scandals in American history.

The Chinese denied everything – and then quietly went about the business of reforming the PLA by divorcing the army from any commercial enterprises. Apparently, the profit motive was at work in the scandal as much as the desire to steal technology. By 2000, the PLA was completely free of any commercial taint.

Enter our friend Mr. Hsu who apparently fled the United States to avoid jail time in his swindling case in 1991. He arrived in Hong Kong where investigators believe he went into the garment industry. Could he have made a fortune in the cutthroat Far East garment industry? As a naturalized American citizen, he almost certainly would have been at a disadvantage in the tightly knit, familial Chinese society – unless he was able to acquire valuable contacts to help him in that hyper competitive market.

It might be interesting to find out who those contacts might be. I am also curious to discover if prosecutors seized any of Mr. Hsu’s assets following his no contest plea in the 1991 swindling case. If he hid any money as a result of any judgments against him, that too, would be a crime. Otherwise, one might question where he acquired the capital to go into business in Hong Kong.

And then there is the matter of the Paw family and questions about how this middle class family has been able to donate hundreds of thousands of dollars over a 3 year period to the Democratic party. The fact that the amount of many of those donations closely track the amounts given by Mr. Hsu would seem to indicate that Hsu may have reimbursed the Paw family for their contributions.

Just recently, Hsu hired William Paw’s 35-year-old son, Winkle Paw to work for “several of his apparel businesses” according to the Wall Street Journal yesterday. As the New York Times reports today, those “apparel businesses” are fictitious. It would be a legitimate inquiry to try and determine if the “salary” being paid to Winkle Paw isn’t part of a deal to repay the Paws for their contributions.

Mr. Hsu is a cipher. With Democratic politicians scrambling to return his direct donations to their campaigns, one wonders how long it will be before they are forced to return monies that he “bundled” for these same candidates thanks to his attempts to skirt FEC regulations.

The last question would have to be when is the media going to get serious about this story? The laughable notion that Senator Craig’s stupidities should take precedence over this developing scandal is ridiculous. And yet, the Washington Post has no stories listed on its website involving Mr. Hsu. They do, however, have two stories and a couple of columns on Larry Craig.

The New York Times, to their credit, is apparently looking into the story as is the Wall Street Journal. The San Francisco Chronicle has the local angle detailing Hsu’s contributions to races involving assemblymen and the mayors of Los Angeles and San Francisco. The Washington Times carried a story culled mostly from wire service reports.

Perhaps when the press is done flogging Mr. Craig and his errant toe tapping, they will concentrate on something a little more important:

Just who is Mr. Hsu?

UPDATE

Ed Morrissey asks the same questions about the source of Hsu’s largesse while detailing the comical explanations of Democratic politicians about why they took money from a convicted con man:

Bob Kerrey has the most laughable explanation, however. The former Senator runs the liberal New School, which made him a trustee after Hsu started showering Democrats with cash. Kerrey explained that he added Hsu to the trustee roster because “I liked his personal story, coming from China, and he had an interest in fashion as well.” All it takes to become a trustee at the New School is to be an immigrant who has an eye for the runway. That says much more about the New School than Kerrey intends.

All of this begs the question: where does Hsu get the money? All of his supposed resources are frauds. Hsu himself is a convicted con man, but the money he threw around was very real. Where did it come from, and what was its purpose?

UPDATE II

Allah is also asking where Hsu is getting his money while linking to this LA Times piece I missed that has some additional information about Hsu’s phantom businesses:

Hsu was affiliated with two businesses — Components Ltd. and Coopgors Ltd. — that have listed addresses on Fifth Avenue. But the building actually houses luxury apartments, not commercial offices, according to a doorman, who has worked there for the last 15 years. The doorman said Hsu lived in the building for a few years but moved out about four years ago.

He moved into the office about two years ago but never unpacked his boxes, said Ken Mulligan, 31, a sales executive for J.P. Doumak, a fabric supplier. He said Hsu would not visit the office space for months, then would show up for a few hours, say “hello,” check his mail, make a few phone calls and leave.