Hotel magnate Chatwal avoids prison in illegal campaign contribution scheme

Chatwal to pay $500,000 fine, gets three years probation

A hotel tycoon and former Hillary Clinton fundraiser avoided prison on Thursday for conspiring to make $188,000 in illegal US campaign contributions using straw donors.

Sant Singh Chatwal, chairman of Hampshire Hotels Management, pleaded guilty last April to violating the Federal Election Campaign Act and witness tampering.

On Thursday, US District Judge Leo Glasser of Brooklyn, New York handed Chatwal a $500,000 fine and three years probation.

The sentence was considerably less harsh than the 57 to 71 months in prison he faced under federal sentencing guidelines, according to court papers. As part of the plea agreement, Chatwal, 70, also agreed to forfeit $1 million.

A spokesman for Chatwal on Thursday said the businessman "deeply regrets his actions and accepts full responsibility."

Chatwal has been a major fundraiser for Democrats including former US Secretary of State Hillary Clinton, who is considering a run for president in 2016.

Clinton was not implicated in the scheme.

Prosecutors said Chatwal from 2007 to 2011 conspired to recruit straw donors -- whom he would reimburse -- to make contributions to candidates for federal office. The scheme violated limits on campaign donations by individuals, prosecutors alleged.

A straw donor is someone who illegally uses someone else's money to make campaign contributions in his or her own name.

The illegal contributions were made to three candidates whose identities were not disclosed.

However, in court papers asking for leniency, Chatwal said that the "majority of contributions (Chatwal) illegally reimbursed" were for Hillary Clinton or her political action committee.

Hampshire, a privately held New York-based company, was founded in 1986 and operates hotels around the world. Chatwal is also the founder of the Bombay Palace restaurant chain.

The case is US v. Chatwal, US District Court, Eastern District of New York, No. 14-cr-143.