John Liu Proclaims 'Clear Conscience' In Campaign Finance Scandal
His campaign treasurer, Jenny Hou has been arrested and charged with fraud and obstruction of justice, and fundraiser Oliver Pan has been indicted on similar charges. No charges have been leveled against Liu. The comptroller defended the two and declared unequivocally, "At no time did we do anything improper or inappropriate. There are lots of rumors and unproved allegations," he insisted.John
Liu Campaign Treasurer, Jenny Hou, Arrested For Fraud In Fundraising Scandal
25-year old Hou of Queens is being accused of willfully participating in a campaigning scheme involving "straw donors" in order to make illegal contributions above the $4,950 limit authorized by the New York City Campaign Finance Board..... In November, federal authorities launched a large-scale investigation of Liu's campaign funds, after a report published by The New York Times canvassed more than 100 homes to uncover nearly two dozen irregularities in Liu's reported donations. ...... Manhattan US Attorney Preet Bharara spoke of Hou's arrest, "New York’s campaign finance laws are not optional....As today’s charges demonstrate, unlawful campaign conduct will not be tolerated." .... Liu's position as city comptroller designates him as the top ranking financial official, as he oversees a $66 billion budget and $120 billion pension fund.Unlucky 800
There were also shared memories of interminable jaunts back from “the City” on the 7 train to Main Street, the last stop on Liu’s daily two-and-a-half-hour round-trip to the Bronx High School of Science. We talked of freezing on street corners waiting for buses (the Q17 for me, the Q27 for Liu), and inhaling a slice or two at Gloria Pizza near 40th Road—RIP, the best, forever! ...... MIT, or “made in Taiwan,” as opposed to FOB, “fresh off boat,” from the mainland and Hong Kong, or ABC, “American-born Chinese” ..... intersection of Main and Roosevelt was getting more foot traffic than any stretch of New York sidewalk outside Manhattan ..... Liu was the first Asian-American citywide officeholder to have a campaign fund-raiser arrested by the FBI, an incident that not only threatened his long-assumed bid for higher office but also could eventually get him indicted on federal charges. ..... (he raised more than a million dollars but listed zero intermediaries, or “bundlers,” responsible for aggregating the money) ...... on October 12, 2011, the Times ran a front-page story asserting that a number of Liu’s supposed donors either could not be found or said they hadn’t given money to the campaign ...... “many of the irregularities in Mr. Liu’s campaign account are tied to companies in the Chinese business community in Queens, where he has been hailed as a hero and his picture adorns the walls of shops and restaurants.” ..... To cover his tracks, Pan told a would-be contributor, who turned out to be an FBI undercover agent, that he (Pan) would recruit twenty phony donors to claim they had given the campaign $800 apiece—eight being a Chinese lucky number. According to the complaint against him, Oliver Pan told the undercover that his $16,000 would buy, among other things, a meeting with the candidate at which a number of the fake donors would be present. The extra people were necessary, Pan is quoted as saying, because if there was no one there except Pan, the contributor, and the candidate, “it don’t look good.” ...... If the allegations were true and Liu had been unaware of the scheme, it still looked bad. He was the comptroller, after all. ...... “I am cooperating fully with the investigation, wherever it leads,” Liu said. Were mistakes made in his campaign filings? Certainly, he said: He should have listed his intermediaries, but now that was being taken care of. Any questionable funds would be returned immediately. Beyond that, he was not overly fixated on what would happen. He was “a humble mathematical physics major,” a trained actuary. He dealt with the numbers, “things that I see right in front of me. I don’t tend to speculate on what may or may not happen.” ...... he wasn’t maniacally tearing down cubicle walls in his office searching for government bugs, as the tabloids were saying ..... His conscience was clear, he said, “because I always knew my campaign finances would be scrutinized. Fund-raising efforts in the Asian community have often been closely scrutinized and questioned. We knew we had to be very careful, to look over every credit-card slip, every check. I am confident we did that to the best of our ability. So I am not worried. Not at all.” ........ “This is not to say I believe our system of justice is perfect.” ..... The Lius settled in Flushing, in part, because Manhattan’s Chinatown was viewed as a packed tenement pile, devoid of grasslands and terrorized by youth gangs. Chinatown was also controlled politically and economically by a Cantonese-speaking Old Guard with strong ties to Chiang Kai-shek’s mostly despised Kuomintang. In comparison, Flushing, which had maybe a couple of chop-suey restaurants, was wide open, a veritable golden mountain of opportunity, and low rents, with access to the 7 train. ...... John Liu, son of Asian-American Flushing, product of luck, pluck, parental expectation, and the public-school system ..... 40 percent of the people are foreign-born ..... “the new identity politics” is back on the front burner .... In the forefront of this arithmetic is the Asian-American community, the city’s fastest-growing demographic. Once politically invisible, New York’s Asian population has increased 32 percent in the past decade to just over a million, half living in Queens. Nowadays, no serious pol can afford not to show his face on Chinese New Year’s. ...... John Liu, a man with a talent for assembling cross-ethnic coalitions ..... Liu was a strong contender to be the next mayor. ..... In the 119 days between the October 12 Times piece to February 8, the New York Post, never fond of the comptroller’s extensive union ties and progressive political positions, ran 54 pieces dwelling on the finance scandal or otherwise portraying the “embattled” Liu in an unflattering light. Even Cindy Adams bashed him. The Daily News was hardly more favorable. One piece that raised eyebrows was a January 10 Times story, played on the front page, detailing how Liu had given out an inordinate number of commendations to various church and business groups—a pretty standard political practice. ...... Liu’s union and outer-borough minority base rallied behind him. He received standing ovations at venues all over town, including Al Sharpton’s House of Justice and a LGBT forum. Council member and prospective candidate for public advocate Tish James said, “John Liu has been saying things that have scared some people. This is a blatant attempt by the permanent and invisible powers-that-be to bring John down.” ...... “Bloomberg hates Liu,” said one well-known former Queens-based elected official. “Bloomberg doesn’t like to be audited, you know. That CityTime thing was a disaster, and Liu has milked it for all it is worth.” ...... The CityTime thing is a scandal that, if it hadn’t been so mysteriously underreported, might by now have taken its place beside the Parking Violations Bureau corruption case that ravaged Ed Koch’s third term ...... When the CityTime project (aimed at automating the city’s payroll, among other things) first began in 1998 under the Giuliani administration, the cost was projected at $63 million. Thirteen years later, by the time Liu became comptroller, the city had already spent as much as $760 million, the lion’s share going to outside consultants. Liu made it an issue, declaring himself “absolutely shocked to find this sort of waste and mismanagement at a time when the mayor is talking about closing schools and firehouses.” ....... “That sort of stuff pisses Mike off, especially if he thought Liu was using the comptroller’s office as a cudgel to run for mayor, which he has been doing since the day he got into office,” asserted the Queens pol, repeating the oft-heard charge that Bloomberg, who everyone assumes will support Christine Quinn in 2013, “uses his chairmanship of the Billionaire’s Club to influence coverage in the three daily papers.” ......... No other Asian-American politician even vaguely approaches Liu in stature, experience, or easy crossover grace in front of a TV camera. ..... Even as the bad stories in the papers piled up, Liu continued to attend multiple events a day, continued to speak as if running for mayor. He seemed unstoppable, unflappable. ...... Virginia Kee, the longtime downtown political figure, went as far as likening Liu’s troubles to those of the Chinatown-born Danny Chen, the U.S. Army private who is thought to have committed suicide following a series of alleged hazing incidents by fellow servicemen in Afghanistan. ....... the overwhelming, unshakable attitude on the part of many that Liu is being singled out for no other reason than he is Asian. Uppity and Asian. ...... According to the 24-page federal complaint, Hou coached a campaign worker to imitate the handwriting of donors, offered to personally reimburse a donor for a contribution, and collected fraudulent forms from “straw donors” while in the employ of an individual identified only as “the candidate.” ....... Jenny Hou was no Oliver Pan. According to many in Chinatown, Oliver Pan was one of “those Fukienese guys from East Broadway” who’d “show up at local political functions, check it out to see if there was any action, and leave.” Jenny Hou was a Flushing resident, a Rutgers graduate, daughter of a longtime Liu supporter, with dozens of happy pictures on her Facebook page. Born in Beijing, a Mandarin speaker, Jenny Hou was a bright young New Yorker with her whole future in front of her. Now, because she worked for John Liu, the Feds said she was looking at up to 60 years in jail. .......... “Dad was a Kennedy fan. So when we came here, he changed his name to Joseph. He had three boys, so I became John and my two brothers Robert and Edward,” Liu said, adding that when his own son was born, he was named Joey, which “broke the tradition.” ........ (asked what exactly an actuary does, Liu replied, “It is kind of like being an accountant minus the personality”) ...... his father, patriarch of his Flushing-bred Kennedy clan. ...... My father sacrificed everything, a high-flying career, because he wanted us to grow up in a better place. But now that we were here, he couldn’t get a job. He was blacklisted. No Taiwanese bank would hire him. Finally, he wound up at a Japanese bank in a dead-end position. A clerk! ....... In 1984, with Flushing already well on its way to becoming an immigrant boomtown, Joseph Liu and a number of partners formed the Seven Giants Properties to develop a Main Street property intended to serve as the headquarters of the Great Eastern Bank. According to a 1999 federal indictment, the Great Eastern directors, of whom Joseph Liu was one, approved a 30-year lease between the bank and Seven Giants that included a $1 million payment to the company. This amounted to a misapplication of bank funds, a move prosecutors contended the group covered up with false entries in books and records. Liu was later convicted on bank-fraud charges. ........ On January 8, 2002, less than two weeks after his son was inaugurated as the first Asian-American city councilman, the then-65-year-old Joseph Liu was sentenced to a month in jail, with six additional months of home confinement. John Liu, who turned 35 that day, attended the sentencing. Interviewed by the Daily News, Liu said that “[there’s] no one more honest, no one more forthright” than his father. He later told the paper, “The verdict was completely wrong.” ........ Ten years later, Liu is still adamant that his father was unfairly convicted. ...... “I’ve always felt guilty about what happened to my father,” Liu said, suddenly choked up. “Because sometimes I think if I hadn’t run for office, if I wasn’t in the public eye, perhaps my father would never even have been targeted … Anyhow, when I tell you that our system of justice is not perfect, this is what I mean.” ........ In 1997, when the then-30-year-old John Liu first ran for City Council, his opponent was Julia Harrison, a 77-year-old Flushing Olde Tymer and Queens County Democratic stalwart. Harrison had caused a stir by characterizing her new Asian neighbors as part of an “invasion,” more like “colonizers than immigrants,” people whose money always preceded them, followed by “the paupers … smuggled in and bilked by their own kind.” There were so many Chinese signs in Flushing, Harrison said, that her constituents couldn’t tell a “hairdresser” from a “nail salon” from a “whorehouse.” ....... She crushed Liu in the ’97 primary, but that was the Olde Tymer’s last stand. Four years later (with Harrison term-limited), when Liu narrowly beat two other Asian-Americans, the result seemed inevitable. ..... the place where he grew up and still lives ..... “We left Taiwan when I was 5, so I always say my Mandarin is like that of a 5-year-old.” Asked if he regretted not continuing with his Chinese, Liu said, “I regret it every day. But when I was a kid, the idea was that the key to success was the English language. This is obviously not the case today. There are 800 million people in the world speaking English and a billion and a half speaking Chinese. So, for all practical purposes of getting ahead in the world, it is better to speak Chinese. My son, Joey, sounds like a New York kid, but he understands the importance of speaking Chinese.” ....... The Feds’ legal net was tightening around him. The conventional wisdom (and many blind quotes in the papers) indicated that Jenny Hou would eventually flip, telling everything she knew, fatally implicating “the candidate.” Yet Liu continued to schedule events, insist that he was moving ahead, keeping his mayoral options open. Was there some cultural nuance I was missing? ....... “I never knew until that moment how awful my father felt about my mother having to work, much less in a sweatshop,” the comptroller said. “Back in Taipei, she had three housekeepers. Now, after my dad brought us here, she is working in a sweatshop and bringing me along. When the reporter asked about the sweatshop, my mom tried to protect my father, the shame he felt.” ........ “In the West, we tend to think about money in the abstract—what does my money and what I do with it say about me? The Chinese attitude was more straightforward. Money equals power, that’s it,” Yang said. For the immigrant, cash mattered, because “they can’t speak the language, they can’t vote. Yet they need some control, some power over their surroundings. That power is cash, and the transfer of it is simple, direct. If a John Liu comes along, he’s the comptroller, a successful and powerful man with an even better future. So people want to connect with him in the best way they can. They want to give him their money. It doesn’t matter how rich they are, if they’re broke, or what some convoluted law they never heard of says: It is an honor to give money to John Liu.” ........ the details in the original Times “straw donor” story bore a strong similarity to another article published in 2007 by the Los Angeles Times concerning Hillary Clinton’s presidential-primary run. Much as the New York Times reporters would four years later in their Liu story, the L.A. Times writers described visiting various East Broadway haunts seeking Fukienese kitchen workers whose names had appeared as Hillary donors but now were nowhere to be found. ...... Seto (who also served as the manager of C. Virginia Fields’s mayoral run in 2005, in which campaign-finance issues also surfaced) ...... “This whole campaign-finance thing is bullshit. No one cares. What matters is China. The Chinese and their money. The Chinese own our debt, they can buy and sell us. That’s the fear. Yellow peril, the sequel. You think the U.S. government isn’t interested in how Chinese money comes into this country, who gets it, where it goes? That’s the essence of the John Liu thing, if you ask me. It is a message. It says, ‘We’re watching.’ ” ....... John Liu, who jokes that “both my first and last names mean toilet, and I’m from Flushing, so don’t even talk to me about my destiny” ...... in the bigger picture, Liu occupied a potentially far loftier position. A Chinese guy in charge of the money ..... there were hundreds of mainland businessmen in New York, party-member owners of tool-and-die factories from Xi’an, Zhengzhou, and Fuzhou, just desperate to have their picture taken with John Liu, to show how connected they were in the City of Jeremy Lin. ....... John Liu exhibited a pained look. “Everywhere I go, people want to take a picture with me” ...... he was in the middle of preparing what he called a State of the City speech that would detail all the money his office had retained for the municipality over the past two years in the categories of “cost savings, revenue enhancements, and cost avoidance.” The grand total for 2010 and 2011 was $923,997,028, or approximately 58,000 times the $16,000 Oliver Pan supposedly collected from the FBI undercover. ........ Mitt Romney just got a quarter of a million dollars from a company giving its address as a post-office box .... here the law was the law, and if Liu’s campaign broke the law, as captain of the ship, he would have to go down. It didn’t matter if the comptroller knew what was going on or not. At the very least, he was guilty of a stupefying degree of willful obliviousness. ...... He wants to run for mayor, so people give him $800. It is the right thing to do. Then, the next day, the FBI is at the door with a subpoena. Eight hundred dollars becomes $10,000 in lawyer fees! That is bad business! I have to tell my members, if you don’t want the FBI at your door, don’t give a first penny to John Liu. Wait a minute or two. See what happens.” ....... It was too bad, Tu said, because “John Liu is the smartest, most qualified, hardest-working politician we ever have in this community.” But the comptroller had a potentially fatal flaw. By being “too aggressive,” Liu had lost sight of “his Chinese nature.” It had nothing to do with failing to act more like the stereotypical retiring, timid Oriental. On the contrary. New York ethnic politics was “a big fight.” To come out on top was a matter of strategy, tactics, practicality, Tu said, rising from his desk as if to act out a Flushing version of Sun Tzu’s Art of War. Liu’s big mistake was forgetting he was “a minority,” an arrogance that blinded him to the fundamental principle of knowing “when to attack, when to give space.” What was the point of going up against Bloomberg when the mayor still had all the power? Why would someone want to poke a finger into the eye of the FBI? “It makes no sense,” Peter Tu said. ...... what Asian-American academics call ‘the perpetual foreigner syndrome’ … that it will always be hard for Asians to be accepted as real Americans. This not helpful. Because that’s not who I am.”John Liu shakes off scandal to haul in 600G
Liu’s campaign haul — boosting his campaign warchest to $2.5 million — was impressive for a candidate determined to stay in the race despite the taint of scandal, but he’s fallen behind Public Advocate Bill de Blasio, who picked up $800,000 in the same period and now has around $3 million. .... Both candidates are still trying to catch up with City Council Speaker Christine Quinn, whose warchest has reached about $5.8 million. .... She raised $697,571 in the fund-raising period that ended Wednesday and — with the city’s generous 6-to-1 matching program giving her as much as $9.1 million to spend — she has nearly all the money she’ll need to run for mayor.Campaign Finance Scandal Gives City Comptroller John Liu Labor Pains
the pension press conference on October 26 Liu may have been his last really good media day. Liu was joined by Mayor Michael Bloomberg and backed up by a high powered union leadership tableau that included Steve Cassidy, president of the Uniformed Firefighters and Michael Mulgrew, president of the United Federation of Teachers. ....... On background, other key union officials said there is still some residual good will for Liu, but no one wanted to go on the record, and thoughts of a Liu mayoral bid are dismissed out of hand. At least one union official felt that Liu's was being railroaded because he was shaking things up with his probes of city contracts. ....... ‘Yes, I am the person in charge of safeguarding the city's money but I wasn't paying any attention to how my campaign funds were being raised.'Liu speaker invites dry up after $candal
Embattled Comptroller John Liu — once one of the city’s most sought-after political speakers — has been taken off the guest lists of many New York civic groups ..... People in the office freaked out .... The situation became so dire that Liu’s planning staff frantically tried to find out about civic and political events that the comptroller had not been invited to — and had him crash the event. ...... the meteoric drop in his political stock is stunning. ..... “This guy was a rock star. It’s sad” ..... For his part, Liu disputed the contention that he has lost his political star power..... “Comptroller Liu had seven events in four boroughs [on Thursday] and there is no sign of slowing down whatsoever,” said Liu spokesman Mike Loughran. ..... A Post review of Liu’s correspondence from early last year showed Liu was once the toast of the town as he was lauded by the city’s civic leaders and power brokers.John Liu Tumbles In Polls After Fundraising Scandal
38% of New Yorkers approve of the job Mr. Liu’s doing compared to 50% in mid-October. ..... Back in May, Mr. Liu’s approval rating was at a high of 57 percent and his disapproval rating was just 14 percent. ..... Mr. Liu has pledged to return $13,600 in donations associated with Mr. Pan. .... Mr. Liu, who was elected in 2009, is considered a likely mayoral candidate for 2013. The poll found that his standing among the other prospective candidates hasn’t changed much. He’s still near the back of the pack with 9 percent.
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