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Hsu gets three years in ‘91 case

Times Staff Writers

Dismissing a claim that Norman Hsu’s right to a speedy trial had been violated because California authorities didn’t fully pursue him after he fled from justice 16 years ago, a San Mateo County judge on Friday sentenced the former Democratic fundraiser to three years in prison for fraud.

Hsu faces a number of other legal troubles. Last month a federal grand jury in New York indicted Hsu, 56, on charges of operating a large new Ponzi scheme and making illegal campaign contributions to Sen. Hillary Rodham Clinton and others.

The sentencing provided long-awaited satisfaction to Hsu’s prosecutors and victims.

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“I am very pleased,” said Ronald D. Smetana, the California deputy attorney general who handled the earlier fraud case against Hsu from its inception. “It is often said that justice delayed is justice denied, but not in this case.”

Hsu emerged on the national political scene four years ago, raising more than $1.6 million for Clinton and other Democrats.

But Hsu had a secret: In 1991, authorities accused him of running a scheme to bilk investors out of $1 million. Hsu had claimed to have contracts to buy and resell latex gloves; in reality, prosecutors said, no gloves or contracts existed. Hsu agreed in 1992 to plead no contest to a reduced charge, but he fled before sentencing.

The case stagnated until a Los Angeles Times article revealed that Hsu, who had hosted a string of lavish events for Democrats and typically identified himself as an apparel executive, was a fugitive.

In August, Hsu turned himself in, posting cash bail of $2 million. Then he fled again. He was recaptured after collapsing aboard a train in Colorado.

Hsu’s lawyers had asked Judge Stephen Hall to throw out Hsu’s no-contest plea, saying authorities could have nabbed him easily just by accessing published accounts of political events, including some in Northern California.

“All they had to do was tap some keys and they would have found him,” said attorney James J. Brosnahan.

Hsu plans to appeal the sentence, as well as Hall’s decision not to throw out the case, Brosnahan said.

Hall said Hsu was responsible for the sentencing delay because his failure to appear “was completely within his control.”

The judge ordered that half of Hsu’s bail money be used to reimburse victims of the latex-glove scam. “I’m happy, real happy,” one investor said, declining to give his name for publication because he was embarrassed by his association with Hsu. “He finally got what he deserved.”

The other half of the money will be turned over to the federal government. It will probably be used to repay victims of a more recent business scheme in which authorities allege that Hsu defrauded investors out of at least $20 million.

Hsu also faces civil lawsuits filed by investors in New York and Orange County, who say he duped them and, in some cases, pressured them to make political contributions to candidates of his choosing.

After Hsu’s past was revealed, candidates gave away his direct donations and the Clinton campaign refunded more than $800,000 raised by him.

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This report includes information from the Associated Press.


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