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...individual "everybody knows" be clean, honest, admirable, and above reproach turns out to be toxic, for any number of reasons.
The recent case of Norman Hsu, the admitted felon and accused fraudster who passed himself off as a successful businessman and major "bundler" of campaign donations, is a classic example. Here's a case study on how the Hsu fiasco happened, and how Hsu's shenanigans could have been detected--partly with amateur detective work, partly with expert help. It has valuable lessons that every corporate director and senior executive would do well to heed.
The task at hand
Political candidates for federal office will spend $6 billion this year trying to get elected. The task of ensuring that none of the big donors are drug traffickers, Hamas members, or convicted pedophiles commonly falls to harried staffs of twenty-somethings hired to perform cursory checks. But when it comes to background checking, Google and basic news searches can go only so far.
Embarrassing revelations about big campaign donors can happen to any political campaign, of either party. Flawless performance is impossible in this realm. It is not feasible for campaigns to do background checks on America's hundreds of thousands of individual campaign donors. But it seems advisable to do comprehensive screening of the biggest "bundlers," or aggregators, who raise huge sums from their personal and professional networks.
Case in point: Norman Hsu, a mysterious man with a shady past and equally shady present who established himself through various wiles as a major bundler of seemingly legitimate political donations. Though he was described by the New York Observer as "an apparel magnate with a fat Rolodex," campaign finance officials apparently knew little about...
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