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Barack Obama's name may emerge in the Norman Hsu Fraud
Trial
12/31/08
President-elect Barack Obama's name may soon pop up in a federal
prosecution, this one involving a massive Ponzi scheme. In addition to the
Rod Blagojevich pay-for-play probe, Obama could figure in the upcoming fraud
trial of Norman Hsu, the disgraced Democratic fundraiser who was charged
last year with operating a $60 million pyramid scheme.
According to investigators, Hsu, a major Hillary Clinton fundraiser,
pressured investors to donate money to political candidates with whom he was
aligned. In a letter last week to U.S. District Court Judge Victor Marrero,
Hsu's lawyer, Martin Cohen, requested a 60-day delay in the start of Hsu's
trial, scheduled to open January 12 (Cohen cited the "extraordinary level of
negative publicity" generated by the recent arrest of alleged Ponzi schemer
Bernard Madoff).
In his December 22 letter, Cohen also noted that Hsu was already "notorious
for his political activities" and that it was "inevitable" that his client's
"connections" to Bill and Hillary Clinton "and other democratic notables
including perhaps the president-elect - will be introduced at trial."
Before becoming a key fundraiser for Hillary Clinton's presidential bid,
Hsu co-hosted a 2005 California fundraiser for Obama's political action
committee and introduced the Illinois Democrat to Marc Gorenberg, a
Silicon Valley venture capitalist who later joined the Obama campaign's
national finance committee.
Prosecutors allege that Hsu directed his investors to donate money to
specific candidates, and then reimbursed them in violation of federal
campaign laws. Unswayed by Cohen's argument, Marrero declined to delay the
trial, which will begin a week before Obama's inauguration.
http://www.thesmokinggun.com
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