Apr 22 2014, 4:06am CDT | by Forbes
Late last week Sant Chatwal Singh, a prominent Indian American hotelier who was a key donor and fundraiser for Hilary Rodham Clinton’s presidential run in 2008, pleaded guilty in a straw donor scheme.
Chatwal admitted that he had funneled more than $180,000 in illegal contributions between 2007 and 2011 to three federal candidates, including Clinton, according to media reports. He pleaded guilty in Federal District Court in Brooklyn on Thursday to skirting federal campaign contribution laws and witness tampering.
Chatwal, who has been friendly with the Clintons for years, had raised about $100,000 for Hillary’s 2008 presidential run. However, it turns out, most of that was illegal as it was an elaborate straw donor scheme in which he illegally reimbursed donors for their contributions, the New York Times reported.
This is quite a fall from grace for a flamboyant, and prominent, immigrant family.
In a cover story for Forbes Asia back in 2006, I had profiled the Chatwal family’s hotel empire in the U.S. Sant and his two sons, including Vikram who was briefly a model who appeared in Vogue, control Hampshire Hotels & Resorts. Since its first hotel, the President, was refurbished in then seedy Times Square in 1987, it had become considerably upscale and added to its portfolio boutiques hotels branded as “Hautel Couture by Vikram Chatwal,” where rooms and suites were rented for princely sums, up to $5,000 a night, to the glitterati. Of course, this was also in the hey days of the last decade and before the financial crash that came a couple of years later.
Sant’s adventures started when he left his home in Punjab and moved to Haile Selassie’s Ethiopia to teach. He opened an eatery there–maybe forecasting his hotel and restaurant chain to come–and grew close to the ruling class there but had to flee after the 1974 revolution. A few stops later he opened the Bombay Palace in midtown Manhattan, the first Indian restaurant to win over the fine-dining set. With that success in hand, he turned to the President and later to other hotels in New York and beyond.
The Chatwals, who have backing from institutional investors, today have 12 hotels in New York and one each in Miami, Bangkok and in the southern Indian city of Cochin (down from 17 at the time of my earlier reporting).
The Chatwals, at least before this turn of events, had social currency. Apart from several political friends–the list was headed by Bill and Hillary Clinton – steel baron Lakshmi Mittal, was a business buddy while self-help guru Deepak Chopra and various musicians and models, including Lindsay Lohan, mingled with the Chatwals on a regular basis. When Vikram, whose more serious past is in finance, trekked to the motherland to marry a Mumbai model with a business pedigree in 2006, it made the cover of New York magazine and a style spread in the New York Times.
Clearly, moving in such circles, especially the politically powerful ones, was important to Sant. In a recorded conversation, the Times reports, he described the importance of the donations to a government informant:
“Without that nobody will even talk to you. When they are in need of money,” he said, “the money you give, then they are always for you. That’s the only way to buy them.”
Vikram too got into trouble when he was arrested last April after trying to board a flight while carrying cocaine, marijuana and prescription pills, and has had several stints in rehabilitation, the Times reports.
Sant, now 70, faces upto 25 years in prison and a lot fewer friends.
In a statement to the Times, a spokeswoman said, “Mr. Chatwal deeply regrets his actions and accepts full responsibility for the consequences.”
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