Aug. 31 (Bloomberg) -- Norman Hsu, a Democratic fundraiser wanted for fraud, turned himself in to California authorities and was released after posting bail, his lawyer said.

``Mr. Hsu has pledged to deal forthrightly with this 15-year-old legal issue,'' the lawyer, Jim Brosnahan, said in a statement today. ``He is hopeful that the matter will be resolved shortly to everyone's satisfaction.''

New York Senator Hillary Clinton is donating $23,000 to charity to offset political contributions she received from Hsu, her spokesman Phil Singer said yesterday. Illinois Senator Barack Obama donated the $7,000 his senate campaign and his Hopefund political action committee received from Hsu to charity, according to spokesman Ben LaBolt.

Hsu, a New York businessman, was charged with grand theft in 1991, entered a no-contest plea to the charge and then failed to appear for sentencing, the Los Angeles Times reported Aug. 29. He voluntarily turned himself this morning in San Mateo, California, Courthouse, Brosnahan said.

The U.S. Justice Department is investigating Hsu for illegally reimbursing others for making hundreds of thousands of dollars in political contributions, the Wall Street Journal reported today, citing unidentified people familiar with the investigation. Hsu reimbursed a family for making $225,000 in donations to Democratic candidates, the Journal said.

`Not Surprising'

``It's not surprising that the Justice Department opens an investigation to chase the story written in the Wall Street Journal,'' Hsu's Washington lawyer, E. Lawrence Barcella, said in an interview.

``As far as campaign contribution aspects of that story, they are not only,'' he said, ``unproven allegations and innuendo but strongly denied by all the parties.''

Barcella said he had no knowledge of such a probe independent of the Journal's report.

Justice Department spokesman Bryan Sierra declined to comment.

Attention focused on Hsu after the Wall Street Journal on Aug. 28 reported his connection to a California family with no obvious signs of wealth that donated a combined $200,000 to Democratic candidates. The donations by the Paw family included $45,000 to Clinton, the Journal said.

To contact the reporter on this story: Edvard Pettersson in Los Angeles at epettersson@bloomberg.net.

Last Updated: August 31, 2007 19:12 EDT