NYC Comptroller and Mayoral Candidate's Ongoing Hsu Problem
Yesterday, The New York Times reported that New York City Comptroller William Thompson has emerged the leader among several rivals in the money race for the 2009 mayoral election.
Alert readers may remember seeing Thompson's name in previous posts, as I included him in September on the roster of local politicians who accepted campaign contributions from convicted felon and serial fugitive Norman Hsu. Hsu was recently re-sentenced to three years in prison for defrauding investors in the early 1990s and now faces a 15-count federal indictment for allegedly swindling investors out of as much as $60 million (money he's suspected of using to grease some 80+ Democratic politicians).
Hsu directly contributed the maximum allowable $4,950 to Thompson in 2006 and according to the campaign finance disclosures released just hours ago, Thompson has failed to return any of those funds.
This, despite the fact that such funds might be used to help compensate Hsu's victims, many of whom are current constituents of Comptroller Thompson, whose duties include the management of the city's $105 billion in pension funds.
Yesterday's financial disclosures show that three of Thompson's opponents in the Democratic mayoral primary who had also received contributions directly from Norman Hsu (City Council Speaker Christine Quinn, Congressman Anthony Weiner, and Councilmember John Liu) managed to find time to return the tainted funds within the week following the Hsu revelations at the end of August. Four months later, it appears Thompson has not.
In the early days of the Hsu scandal, Azi Paybarah at The New York Observer reported that an aide to Comptroller Thompson said he planned to donate his Hsu money to charity. Indeed, there are three charitable contributions from September listed on Thompson's latest financial disclosure, which collectively approximate the amount he received from Hsu. The problem is, according to the Campaign Finance Board, the use of campaign funds for charitable donations is explicitly forbidden.
A candidate is not permitted to take public funds that he has received for a specific public purpose, and re-direct them toward an entirely different and non-campaign-related purpose. Some candidates have argued that such expenditures are indirectly campaign-related because they generate good will and favorable publicity among voters in their districts. However, such benefits are too tenuous to be considered “in furtherance of” a campaign.
That might be why Thompson's counterparts chose to disgorge the money via refunds, in keeping with local election laws.
That said, Rep. Weiner and Councilmember Liu weren't able to get their hands completely clean. Weiner refunded a total of $15,750 in contributions from Hsu, three members of the Hsu-connected Paw family of California, and four other suspected members of Hsu's straw donor network. However, he received thousands more from Hsu's identified affiliates that he has yet to return. Liu made just one refund - to Mr. Hsu directly, who only accounted for $4,950 of Liu's total haul of $22,950 in Hsu-tainted contributions. Speaker Quinn's only problematic transaction was a single $4,950 contribution directly from Hsu, which she promptly returned.
Still, notwithstanding Weiner's and Liu's incomplete disgorgements, Comptroller Thompson appears to be the only mayoral candidate to decide to keep a check actually signed by Norman Hsu. If the indictment against Hsu is accurate, that money was almost certainly swindled directly from some of the very people who put Thompson in his current office and whom he will ask to elect him mayor next year.
If Thompson plans to make the case that his mayoral qualifications are validated by his performance as the city's chief money manager, he may want to consider clearing his books of this indignity.
The summary and transaction-level detail of the nationwide contributions of Hsu and his suspected affiliates are available in these Google spreadsheets. A searchable database of campaign finance disclosures is available on the NYC Campaign Finance Board's website.
Handcrafted by Flip on January 16, 2008 |
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