Clinton Probe Figure Indicted in Tax Case

Maria Hsia, a key figure in the presidential fund-raising investigation, was indicted by a federal grand jury Tuesday in Los Angeles on tax fraud charges.

Hsia, who operates an immigration consulting firm in San Marino, was accused of failing to file a personal income tax return for 1994, filing false returns for 1995 and 1996 and aiding in the filing of a false corporate return for 1995.

It was the second time this year that a federal grand jury indicted the onetime Democratic fund-raiser.

A grand jury in Washington, D.C., charged her in February with using money from the Hsi Lai Buddhist Temple in Hacienda Heights to make disguised, illegal contributions to the 1996 Clinton-Gore reelection effort and to a number of other national, state and local campaigns.

Hsia, who has pleaded not guilty in that case, could not be reached for comment about Tuesday’s indictment.

But her lawyers had harsh words for the Justice Department’s Campaign Financing Task Force, which sought the Washington and Los Angeles indictments.

The latest action is “a squeeze play, an eleventh-hour attempt to force Maria Hsia to plead guilty to the charges in Washington, but it’s not going to work,” said her Washington defense attorney, Nancy Luque. “She’s not going to plead guilty because she didn’t break any law.”

Hsia’s Los Angeles lawyer, Walter Weiss, said the task force had “no compelling reason to bring the tax charges at this time except to force her to fight two criminal cases simultaneously 3,000 miles apart.”

Both lawyers called the tax charges bizarre, saying the task force was offered persuasive evidence that Hsia did not cheat the government out of tax revenues.

A Justice Department spokesman said, in response, “We’ll let the indictment speak for itself.”

Details about the tax case were sketchy. The indictment said that besides failing to file a return for 1994, Hsia reported an income of $16,314 for 1995 and $10,026 for 1996 although she knew she had earned more than those amounts. It did not specify how much more.

The indictment also accused her of willfully aiding in the preparation of a false return for her immigration counseling business, Hsia & Associates, which listed gross receipts of $240,189 in 1995.

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The failure-to-file charge, a misdemeanor, carries a maximum punishment of one year in prison and a $100,000 fine. Each of the three other charges, all felonies, carries a maximum penalty of three years in prison and a $250,000 fine.

Hsia’s Washington trial is set to begin Aug. 31, although Luque said she would file motions in the coming weeks to dismiss the charges.

In addition to allegedly using monks and nuns at the Hsi Lai Temple to launder donations to the Democrats’ 1966 national campaign, Hsia was accused of conspiring with the temple to launder contributions to Republican Don Knabe’s 1996 race for Los Angeles County supervisor; the 1994 reelection campaign of U.S. Sen. Edward M. Kennedy (D-Mass.); the 1996 reelection campaign of his son, Rep. Patrick J. Kennedy (D-R.I.); and Democrat March Fong Eu’s 1994 reelection campaign for California secretary of state.