Judge Freezes Fundraiser Hsu's NYC Bank Accounts

by SAMUEL MAULL Associated Press Writer

posted 09/26/07

A judge has frozen bank accounts and sealed the Manhattan apartment of Norman Hsu at the request of investors who say the jailed political fundraiser stole $40 million from them.

State Supreme Court Justice Shirley Kornreich granted the application of attorney Ronald Minkoff to attach Hsu's accounts at Bank of America and Metrobank New York and to seal his apartment on Wooster Street in Lower Manhattan. The judge said Minkoff's client, Source Financing Investors LLC, had to post a $150,000 bond in case Hsu is improperly damaged by the asset freeze.

Minkoff said in court papers that he wanted asset attachment orders to include funds donated to the campaigns of:

• presidential candidate Hillary Rodham Clinton,
• Gov. Elliot Spitzer,
• state Attorney General Andrew Cuomo and
• Rep. Kirsten Gillibrand, D-N.Y.

The judge did not act on that request because no one was in court to represent the politicians. Minkoff said he had not told them about proceeding after speaking to their offices by telephone.

The lawyer told Kornreich that:

• Clinton's people said she had sent back all money contributed by Hsu;
• that Gillibrand's people said she had given the money to charity;
• that Cuomo's camp is holding the money while trying to work out an escrow arrangement, and
• that he had not heard from Spitzer's people.

Minkoff said he wanted the asset attachments as a step toward recovering his client's money. He said Hsu stole it by claiming he had deals to buy menswear from a manufacturer in China and sell it at a profit to American companies that included Macy's, Nordstrom's, Theory, DKNY, L.L. Bean, and others. Hsu was not represented at the hearing, but his lawyers have said that he is not guilty of any wrongdoing.

Minkoff told Kornreich the Bank of America account contains about $83,000, while he did not know how much was in the Philippines-based Metrobank New York. Minkoff said outside court he simply did not know whether Kornreich would have the authority to order recipients of Hsu's largesse to return the money. Kornreich and Minkoff agreed that any action federal investigators and prosecutors decide to take with regard to Hsu would preempt her orders.

Hsu, 56, is in jail in California where he has been wanted since 1992, when he pleaded no contest to grand theft charges in fraudulent clothing import business, then skipped town before he could be sentenced. Investigators say they believe Hsu fled to Hong Kong. After being a fugitive for about 15 years, Hsu was arrested about three weeks ago after he became ill and was taken off an eastbound Amtrak train in Grand Junction, Colo., and hospitalized.