Pan, according to the charges, attempted to donate $16,000 to Liu's campaign--far over the $4,950 limit for individual donors--by using 20 straw donors to funnel the money.
The arrest is just the latest news dogging Liu as he moves towards a run to replace Michael Bloomberg as mayor of New York. Last month, the Times reported on several irregularities in Liu's campaign fundraising reports. The paper raised questions about the source and legitimacy of some donations, even questioning the existence of some donors.
Tuesday, the Times broke the news that federal authorities were investigating Liu's fundraising, and that a grand jury was issuing subpoenas. The same article revealed that Liu is also under investigation examining whether he had accepted foreign money during his 2009 campaign for comptroller.
Liu is considered a rising star in the New York Democratic party and is considered a strong contender for mayor, in part because of his fundraising prowess. On Monday, he told the Times that his campaign would cooperate fully with the investigation.
"I am confident that my fund-raising efforts were proper at all times," he said.