Hillary will return funds raised by Hsu

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ASSOCIATED PRESS

Sen. Hillary Rodham Clinton’s presidential campaign said yesterday that it will return $850,000 in donations raised by Democratic fundraiser Norman Hsu, who is under federal investigation for purportedly violating election laws.

Mrs. Clinton, New York Democrat, had planned only to give to charity $23,000 that she received from Hsu for her presidential and senatorial campaigns and to her political action committee, HillPac.

The FBI is investigating whether Hsu paid so-called straw donors to send campaign contributions to Mrs. Clinton and other candidates, a law-enforcement official said yesterday.

“In light of recent events and allegations that Mr. Norman Hsu engaged in an illegal investment scheme, we have decided out of an abundance of caution to return the money he raised for our campaign,” Clinton spokesman Howard Wolfson said last night. “An estimated 260 donors this week will receive refunds totaling approximately $850,000 from the campaign.”

Mr. Wolfson said the Clinton campaign also will vigorously review its fundraisers, including thorough criminal background checks, in the future.

The amount that the campaign identified as raised by Hsu would make him one of her top fundraisers. During the first six months of this year, her presidential campaign raised $52 million from individual contributors.

Although Mrs. Clinton will return the money raised by Hsu, Mr. Wolfson said, the individual contributors could make new donations.

“We will accept their contributions and ask them to confirm for our records that they are from their own personal funds,” he said in an e-mail.

Since 2004, Hsu has donated $260,000 to Democratic Party groups and federal candidates and raised hundreds of thousands of additional dollars. He was regarded as a top party fundraiser until recent reports surfaced that he was wanted on a warrant in California in connection with a 1991 grand-theft charge.

Federal authorities are examining whether Hsu leaned on investors to contribute to political candidates after paying them big earnings from a shady business venture he was running, the law-enforcement official said.

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