Legal News

Dapper Democratic Fund-raiser Pleads Not Guilty to Fraud Charges

By Amir Efrati

Yours truly got up extra early this morning to catch the federal court arraignment of Hassan Nemazee, a New York financier and well-known Democratic party fund-raiser.

At the court, Nemazee, looking dapper in a dark suit, seemed relaxed and pleaded not guilty to bank fraud charges after being indicted by a grand jury earlier this week on charges that he fraudulently obtained $292 million in loans from three banks: Citibank, Bank of America and HSBC. (Background on the case is here and here.)

For now Nemazee (pictured, to Bill Clinton’s left), who runs an eponymous investment firm, will remain confined to his home, pending trial, on a $25 million bond (guaranteed by his $20 million Manhattan apartment).

John Hillebrecht and Dan Levy, prosecutors from the U.S. Attorney’s office in Manhattan, allege Nemazee, who has long ties to the Clinton family and also raised money for then-candidate Barack Obama, used the ill-gotten loans in part to fund a lavish lifestyle and contribute to Democratic campaigns and political action committees. They said in court that the feds hauled off 15 boxes worth of materials from Nemazee’s office after his arrest.

Democrats have been abuzz about the case and several politicians and groups have said they would donate any funds Nemazee contributed during the most recent election cycle.

The last time Nemazee made a court appearance, after his arrest in August, the attorney by his side was Marc Mukasey, son of former Attorney General Michael Mukasey. But due to a conflict, Nemazee is now being represented by Stillman Friedman’s Paul Shechtman, who said after the hearing that his client’s campaign contributions were “modest and lawful.”

Shechtman tried to distinguish the Nemazee case from that of Norman Hsu, another big fund-raiser for Hillary Clinton, who was found guilty earlier this year of illegally reimbursing political donations by associates. “This is not a case about funneling money to candidates,” Shechtman said about the Nemazee case.

Photo: Fremson/AP

Full post as published by Law Blog - WSJ.com on September 23, 2009 (boomark / email).