Hsu ordered held without bail

Hsu was ordered held in connection with a 1991 case in which he pleaded no contest to fraud charges. Hsu's attorney, James Brosnahan, today urged Superior Court Judge Robert D. Foils to expunge that plea, which would have led to a three-year prison term.

Foils set another hearing for next Friday.

Today's action comes a day after Hsu, who raised hundreds of thousands of dollars for Democratic candidates, was named in a federal complaint that alleged he was the mastermind of a Ponzi scheme that defrauded investors from New York to California out of more than $60 million.

Investors in the New York area said they lost at least $40 million. Hsu reportedly took in millions more from about 60 investors in Orange County.

Hsu had pleaded no contest to California theft charges in connection with a fraudulent import business. He surrendered last month but fled again after being released on $2 million bail. He was apprehended in Colorado and returned to California on Thursday.

Brosnahan today asked that the $2 million bail be returned. Judge Foils told the lawyer to put the request in writing.

Hsu was unknown on the national political scene before 2003, but his ability to provide campaign donations whenever he was asked earned him invitations to exclusive events with Bill and Hillary Clinton and their friends.

Hsu was flying high with the Clintons and with his investors until a few weeks ago, when the Wall Street Journal and then The Times reported details about his activities.

After The Times revealed that Hsu was a fugitive from the grand theft case, he agreed to appear at a San Mateo County court hearing. Instead of showing up, he fled again. He was removed from an eastbound train in Grand Junction after falling ill. Passengers reported that he was behaving strangely and was in apparent distress.

Before boarding the train, Hsu had sent letters appearing to indicate that he planned to commit suicide. The letters turned up in the offices of charities and political campaigns he had supported.

FBI agents said that after Hsu was arrested this month in Colorado, he asked to talk with them -- without his attorneys present -- and waived his right to counsel. During the conversation, the complaint said, he confessed that the deals into which his network of investors had poured millions "did not actually exist."

Brosnahan today criticized the questioning by the FBI, calling it "wrong, absolutely wrong."

The federal charges were announced on Thursday, the same day that Hsu was extradited from Grand Junction to California.

U.S. Atty. Michael J. Garcia of the Southern District of New York unsealed a 16-page complaint charging Hsu with mail fraud, wire fraud and violating the Federal Election Campaign Act by reimbursing some associates for their political donations. If convicted, he could face up to 45 years in prison.

"This case is about greed," the New York prosecutor said at a news conference. Hsu sought financial gain, he said, and contrived "to purchase a place on the celebrity campaign circuit."

Last week, after The Times reported that some Hsu investors had complained of being pressed to make contributions, Clinton's campaign said it would return $850,000 from about 260 donors associated with him.

dan.morain@latimes.com