WASHINGTON -- In returning $850,000 to donors associated with a disgraced fundraiser, Sen. Hillary Rodham Clinton sets a significant new standard for how campaigns should respond in the face of potential scandal.
Clinton's decision also underscores the price — financial and political — that her campaign is paying for failing to spot trouble with the fundraiser, Norman Hsu, even after receiving a warning. The campaign announced it would now conduct background checks on its fundraisers, an extraordinary and potentially time consuming step.
By returning the money, Clinton also puts pressure on presidential rivals and other politicians with rainmakers who have dubious pasts or who have employed questionable fundraising tactics, including the campaigns of Barack Obama and John Edwards.
Hillary is turning the screws on her presidential rivals.
I'm still waiting for Jim Doyle to follow Hillary's example and return his dirty money from Hsu.
Regarding Doyle, Bruce at Badger Blogger notes:
It shouldn’t take a math major to figure out why Jim Doyle still refuses to return $2,000.00 in campaign contributions he received from convicted, sixteen-year, two-time fugitive Norman Hsu. It would establish a dangerous precedent for Doyle’s campaign account.
Read more.
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New information:
Where did Norman Hsu get his money?
That has been one of the big questions hanging over the prominent Democratic fund-raiser, as reports have surfaced about hundreds of thousands of dollars he made in political donations, plus lavish parties, fancy apartments and a $2 million bond he posted to get out of jail earlier this month.
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.
Mr. Hsu told Mr. Rosenman the money would be used to manufacture apparel in China for Gucci, Prada and other private labels, yielding a 40% profit on each deal, according to a business plan obtained by the Journal. Now the investment fund, Source Financing Investors, says Mr. Hsu's company owes it the $40 million, which represents 37 separate deals with Mr. Hsu's company. When Source Financing recently attempted to cash checks from the company, Components Ltd., the investors say they were told the account held insufficient funds.
Source Financing's arrangement with Mr. Hsu's company, according to court documents and investor accounts, echoes an older matter that came to light in recent weeks. In 1991, California officials charged Mr. Hsu with grand theft for failing to repay investors for money he raised to import latex gloves from China.
(h/t Captain's Quarters)
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