Disgraced political donor Norman Hsu wasn't hiding from anyone over the past few years, his lawyers say. If California authorities really wanted to find him, they could have asked Hillary Rodham Clinton or one of the other prominent Democrats he showered with generous cash donations.
Now Hsu is asking a judge to toss his 15-year-old felony fraud
conviction, arguing his right to a speedy trial was violated because authorities weren't actively pursuing him. They could easily have arrested Hsu, his lawyers argue, at one of the swank fundraisers he hosted in California for prominent local politicians like Rep. Doris Matsui, D-Sacramento.
"Mr. Hsu lived an open and public life and the government made no apparent efforts to arrest him," attorney James Brosnahan wrote in court papers filed last week. "He did not act like a fugitive. He did not evade the authorities, but rather openly associated with highly public officials."
State prosecutors filed their own documents Tuesday arguing Hsu
shouldn't benefit from his flight from justice, even if he was hiding in plain sight.
"To allow Hsu to profit from his own misconduct would stand the
criminal justice system on its head," deputy attorney general Ronald Smetana wrote.
Hsu's troubles began dogging big name Democrats, including Clinton, this summer when news reports revealed he was a fugitive who fled the state before he was sentenced for a 1992 fraud conviction. He turned himself in on Aug. 31 - then fled again.
He was recaptured last month after he tried to kill himself by overdosing on drugs aboard an eastbound Amtrak train in Colorado. Hsu is being held without bail in a Redwood City jail.
In recent years, Hsu became a top political fundraiser, donating generously to Democratic candidates and causes and raising much
more from other contributors. Since his fall from grace, many of those donations were given to charity or returned. The Clinton campaign pledged to divest $850,000 raised by Hsu.
On Nov. 2, Hsu's attorneys will ask a San Mateo County Superior Court judge to dismiss the fraud case, in which Hsu pleaded no contest to charges he bilked investors out of $1 million. He faces up to three years in prison.
If Brosnahan fails get the case dismissed outright, he says he will then ask that Hsu be allowed to withdraw his 1992 plea because the judge who accepted it and was scheduled to sentence Hsu before he fled has since retired. If Hsu succeeds in taking back his plea, his case goes back to square one and could then go to trial.
"Mr. Hsu has the right to have the same judge who accepted his plea impose sentence," Brosnahan wrote in court papers.
Smetana says investigators periodically checked Hsu's former apartment, his wife's home and his son's school in the years following his disappearance. But he concedes investigators stopped looking for him after they became convinced he'd left the country for Asia.
Still, the arrest warrant remained active the entire time Hsu was a fugitive, Smetana argues, and he refused a court clerk's 1998 request to take it off the books.
Smetana also said previous California cases have allowed another judge to sentence criminals after the retirement of the judge who originally handled the case.
Even if Hsu manages to succeed in getting out from under the California charges, he still faces fresh federal felony charges in New York.
The U.S. attorney's office there has charged Hsu with operating two Ponzi schemes, in California and New York, that defrauded investors of a combined $60 million. He's also accused of pressuring investors to make campaign contributions, and giving others money to make donations.
He also faces two competing lawsuits filed by aggrieved investors who said Hsu duped them out of the $60 million federal officials accuse him of stealing. Federal investigators found little trace of that money when they seized Hsu's bank accounts and other assets last month az part of their fraud investigation.
The new set of allegedly jilted investors will also have a hard time getting any of the $2 million cash bail Hsu forfeited when he skipped a Sept. 5 court date in Redwood City. Hsu wants the money back, but prosecutors will ask the judge next week to put $2 million into a special account to reimburse victims of Hsu's 1990s scam.
Ronald Minkoff, a lawyer for a New York investment group suing Hsu for $40 million, said he's disappointed the campaigns didn't heed his call to place the tainted funds into a special account until an equitable distribution system could be set up.
"Federal regulations don't give the candidates a lot of options," said Minkoff, conceding that the candidates would have to get "creative" to get around election finance laws to set up the accounts he contemplated.
"There's nothing in the federal regulations that deals with the notion that someone would steal money and then give it to a political campaign," Minkoff said.
(Copyright 2007 by The Associated Press. All Rights Reserved.)