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Hsu Headed to Prison

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PAUL ELIAS | January 4, 2008 04:59 PM EST | AP

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REDWOOD CITY, Calif. — Disgraced political donor Norman Hsu was sentenced Friday to three years in prison after a judge refused to throw out his 1992 no-contest plea to fraud.

Hsu's lawyers had asked Judge Stephen Hall to dismiss his 16-year-old plea, arguing that Hsu's right to speedy justice was violated because authorities were not actively pursuing him during his years as a fugitive. They could easily have arrested Hsu, his lawyers argued, at one of the fundraisers he hosted in California for prominent local politicians.

Hsu also faces federal fraud charges in New York.

His troubles began dogging Sen. Hillary Rodham Clinton and other big-name Democrats last summer when news reports revealed he was a fugitive who fled the state before he was sentenced for the 1992 fraud conviction for scamming investors out of $1 million.

He turned himself in on Aug. 31, posted $2 million in bail, then fled again, skipping a scheduled court appearance.

He was recaptured in September in Colorado after he tried to kill himself by overdosing on drugs aboard an eastbound Amtrak train. Hsu has since been held without bail in a Redwood City jail.

Hsu lawyer James Brosnahan said his client will appeal the sentence as well as the judge's refusal to toss out the case.

Public records show Hsu lavished millions in campaign contributions on a host of candidates since 2003. He also attended many well-publicized fundraisers, including several in Northern California.

Hall also refused to let Hsu withdraw his no-contest plea because his "failure to appear was completely within his control," and ordered half of the $2 million Hsu posted as bail be turned over to federal authorities for possible victim restitution there. The other half will be used to reimburse the victims of Hsu's first scam.

Since his fall from grace, many of the candidates Hsu supported gave their donations to charity or returned them. The Clinton campaign pledged to divest $850,000 raised by Hsu.

Hsu also faces federal fraud charges in New York for allegedly orchestrating a scam that bilked investors out of at least $20 million over the last several years.

Federal prosecutors said Hsu hoped his lavish campaign contributions would help draw money to his scheme by raising his public profile. To achieve his aims, prosecutors said, Hsu pressured many of his victims to contribute thousands of dollars to various candidates.

Hsu has also been sued by angry investors in California and New York who said Hsu duped them out of $60 million.