Sightings from The Catbird Seat
~ o ~
February 12, 2006
Lingle aides bypass
By Sean Hao, Honolulu Advertiser
Lingle administration officials may have violated state procurement laws
last year when they selected a Honolulu nonprofit organization to handle
finances for the governor's trade mission to China and Korea.
The state tapped the nonprofit Pacific and Asian Affairs Council to run
Gov. Linda Lingle's China trip without asking other organizations if they
would like to bid on the $268,637 project. The Pacific and Asian Affairs
Council in turn hired several companies, such as Events International Inc.,
as subcontractors without following a bidding process.
The Pacific and Asian Affairs Council was paid nearly $7,000 for
administering the trip and got a boost in prestige from its close association
with a major state initiative. Events International and a related company got
contracts worth $20,000.
While the payments don't appear to be excessive, the apparent failure of
state officials to follow procurement laws raises questions. Procurement laws
are meant to ensure the state gets the best value for its money and that
potential state suppliers are treated fairly.
Ted Liu, director of the Department of Business, Economic Development
and Tourism, said the state was not obligated to follow usual procurement
policies because the trips were funded by corporate sponsors and not
taxpayers. Using a nonprofit made the process of raising and spending money
more efficient and allowed the agency to keep sensitive details about the
mission private, Liu said.
"That doesn't pass the smell test," said Sen. Sam Slom, R-8th (Kahala,
Hawai'i Kai). "If people are going to believe in the procurement process, then
everybody has got to do the same thing and everything has to be above
The law requires competitive solicitations even if vendors aren't paid
directly by the state, according to the State Procurement Office.
Aaron Fujioka, State Procurement Office administrator, said he couldn't
comment specifically on the China trip. However, he said, "The procurement
code applies to all contracts made by government bodies whether the
considerations for the contract is cash or other realizations" such as
enhanced reputation. "If there is a realization, is it subject to the code? I
would say yes it is," Fujioka said.
The Lingle administration already has come under fire for seeking large
corporate sponsors for the elaborate trips in exchange for promises of
special benefits. Now it's the manner in which state officials spent money
that is being questioned.
If DBEDT's actions don't violate procurement law, they seem to have been
an attempt to sidestep the law, said state Sen. Shan Tsutsui, D-4th
(Kahului), vice chairman of the Senate Ways and Means Committee.
"It was not the intent to allow a nonprofit to serve as a pass-through to get
around the procurement law," Tsutsui said. "If that is happening, we may
need to look at it."
The nonprofit that raised and oversaw the spending of $268,637 for
Lingle's trip said all decisions concerning subcontractors and money were
made by Liu's department.
"As we understood it per our agreement ... DBEDT was responsible for the
planning and organizing of the mission and as such, the selection of and
negotiation with vendors," said Lisa Maruyama, executive director of the
Pacific and Asian Affairs Council, in an e-mail to The Advertiser.
"We paid vendors based on invoices sent to us from DBEDT — invoices that
had first been received by DBEDT, reviewed and verified for accuracy by
DBEDT and then subsequently signed by Ted Liu at DBEDT," Maruyama
While that may raise procurement issues, the head of one of the companies
hired to work on Lingle's trip said it was not their intent to exclude other
"If there's a gray area here it's unfortunate because I don't think anybody
had any malicious intentions," said Eric Schneider, chief executive for
Events International. "It was a bunch of people getting together trying to
do something good for the state of Hawai'i. All anybody could talk about
when they got back was what a success this public-private partnership was."
Liu says Lingle's trip to China and South Korea in June produced millions of
dollars in business for the state, and taxpayers saved money because most
of the trip was paid for by private donors. Altogether 200 business leaders,
state officials and entertainers accompanied Lingle on the 10-day trade
Liu said he was advised that he would not need to follow the procurement
process when selecting a nonprofit to organize the trade missions.
"Based on discussions with the Office of the Attorney General and the
State's Chief Procurement Officer, no competitive selection process was
required," Liu said in a written reply to The Advertiser.
The Attorney General's office declined to comment for this story.
However, an April 5 letter from Deputy Attorney General John Wang to
Liu's department warned Liu's department about funneling money for the
trip through a nonprofit. The letter says that if Liu or someone from his
department helps make decisions about how money is spent at a nonprofit
organizing a state trade mission, it may violate procurement law. The letter
refers to "DEC," or the nonprofit Hawaii District Export Council, which was
originally considered as the main organizer of the China trip. That job was
ultimately given to the Pacific and Asian Affairs Council.
"The fact that DBEDT has a member on the DEC subcommittee that will
supervise and operate the bank account may be a violation of the state's
procurement law," Wang's letter said. "Though the DBEDT member is in the
minority on the sub-committee, the DBEDT member may be able to exert
influence over the other members and direct expenditure of funds without
complying with the procurement law. It is strongly suggested that there be
no DBEDT member on the sub-committee."
Despite that warning, Liu played a lead role in deciding how the Pacific and
Asian Affairs Council spent money related to Lingle's China trip. For
example, Liu directed the nonprofit to hire Honolulu-based Events
International in May to plan and provide entertainment for the China trip,
according to the Pacific and Asian Affairs Council.
In addition to the warning from the Attorney General's office, Liu's
department was told by the State Procurement Office that it could not hire
Events International without going through a competitive solicitation.
Events International was offering to promote and produce the China trip for
free. But the procurement office, in a March 8 letter, said DBEDT still
needed to go through a bidding process.
"Since there is a potential for a contractor to derive benefits as a
result of receiving this contract, a formal competitive solicitation should
be issued to allow potential vendors the opportunity to receive this
contract," according to the procurement office letter.
Events International was hired by the Pacific and Asian Affairs Council,
which as a private nonprofit is not required to use a bidding process.
"When (DBEDT) didn't get the exemption, they found another solution and
we didn't see anything wrong with it," said Events International CEO
Other nonprofits with an interest in China should have been notified about
the state's interest in lining up organizations to work on the trip, said
Johnson Choi, president of the nonprofit Hong Kong-China-Hawai'i
Chamber of Commerce.
"Generally I think everything should be on the up and up and it should be on a
bidding process," Choi said. "DBEDT was just looking for a yes man.
Somebody that wouldn't ask any questions...."
~ ~ ~
MAJOR DONORS GIVE $359K TO LINGLE
The Lingle administration raised $359,445 from private and public
organizations to fund two trade missions to China. After a request from The
Advertiser first sent in June, the Lingle administration recently released
the names of the donors and the amounts they gave. Here are the major
SPONSORS FOR LINGLE CHINA MISSIONS
DFS Hawaii: $50,000
Ko Olina: $35,000
Castle & Cooke: $32,500
Dole Foods: $32,500
Alexander & Baldwin: $30,000
Hawaii Modular Space: $20,000
Simple Green: $20,000
Deep Seawater International: $17,945
Hawaiian Natural Water Co.: $15,000
Hawaii’s Own: $10,000
State Dept. of Agriculture: $10,000
Solstar Corp: $10,000
China Warranty Corp: $7,000
Hawaiian Host: $5,000
Pacific Resources: $5,000
Marriott International: $5,000
Market City Ltd.: $4,500
Hawaii Tourism-Asia: $2,000
Outrigger Hotels: $1,500
Pacific Basin Airport Maintenance: $1,500...
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"Pay to Play" System Exposed: 40 Percent of
Consulting Companies Working on City's
$1 Billion BRT Under Investigation
By Malia Zimmerman, HawaiiReporter
Editor's Note: Hawaii Reporter has sought for more than 14 months public
records from the City & County of Honolulu that document the city's more
than $20 million in expenditures on the $1 billion proposed Bus Rapid Transit
System (BRT), planned for various parts of Oahu beginning in Waikiki. Council
Member John Henry Felix assisted Hawaii Reporter in submitting the original
request for copies of the BRT contracts in March 2002, but his written request
was never even acknowledged by the City administration before he left office in
December 2002. Council Member Charles Djou continued where Felix left off,
submitting another request when he took office in January 2003, and
resubmitting follow up letters several times over the next four months. In
May 2003, the city Department of Transportation Services released
several file boxes of contracts that listed on each contract the primary
contractors and subcontractors for more than $12 million of the $20 million
reportedly expended on the BRT. Djou and Hawaii Reporter immediately
resubmitted another request for the remainder of the contracts with no
answer from the city Department of Transportation Services to date.
This report is published after dozens of hours reviewing several thousand
pages of city documents naming contractors and subcontractors working on
the BRT and what they were paid, as well as state Campaign Spending and
Department of Commerce and Consumer Affairs records. Hawaii's
powerful Democrat elected officials, in power for 40 consecutive years, have
traditionally had their political campaigns funded by supporters who in return
receive lucrative government contracts or zoning, permitting and other
benefits for their businesses from those government officials.
This indisputable fact has been documented in thousands of pages of
investigative reports at the state Campaign Spending Commission, the
Honolulu Police Department and Honolulu City Prosecutor. These agencies are
working to break this cycle by exposing the system and prosecuting the
players. At stake are billions of dollars collected from taxpayers in Hawaii,
which in turn are paid to these contractors and then passed on to the
campaigns of prominent Democrats. Former Gov. Benjamin Cayetano fed this
cycle by authorizing billions of dollars from taxpayers be directed to public
construction projects, bid and non-bid, saying the infusion of cash would spur
the local lagging economy.
The latest major construction project that Oahu's Democrat mayor is
pushing for the BRT will cost taxpayers more than $1 billion just to
construct and considerably more to operate and maintain.
The consulting projects implemented to launch the BRT are being awarded to
many companies recently in the news for making excessive and illegal
contributions to the mayor and other prominent Democrats such as former
Gov. Cayetano, former Lieutenant Gov. Mazie Hirono and former Maui Mayor
The system is called "pay to play," deemed so last year by Bob Watada,
director of the state Campaign Spending Commission, who has investigated
and is in the process of fining more than 100 companies for violating state
campaign spending laws in an effort to participate in the political pay to play
game. Honolulu Mayor Jeremy Harris' campaign and administration have been
under investigation by a multitude of law enforcement agencies for nearly
two years for operating such a system that, according to those doing
business with the city, encourages or demands contributions in exchange
for city business, permitting and zoning.
No where is this more clear than when looking at the BRT and the more than
$20 million in contracts awarded to date. More than 40 percent, or 16 of 36
of the consultants working on the BRT, are under investigation, indictment or
have been convicted for illegal contributions, and in some cases, for money
laundering contributions to these candidates. Those alphabetically include:
Char & Associates, a company owned by Peter Char, close friend of the
mayor and treasurer of the mayor's campaign, who died while under
investigation. His wife, Lynette, is a city employee with the Dept. of
Enterprise Services. Char & Associates received up to an estimated
$216,297 in BRT city contracts, though the city does not specify in the
documents the exact amount this subcontractor was paid.
ECS Inc. was fined $49,300 by the state Campaign Spending Commission for
making a total of $80,000 in contributions including $30,000 to Harris,
some of which was deemed excess and illegal. This company received up to
$521,065 in consulting contracts for the BRT, though the exact amount was
not disclosed by the city on the copies of the contracts reviewed by Hawaii
Geolabs Inc. was fined over $64,000 for laundering $120,000 with around
$60,000 going to the campaign of Harris. In total, the people associated and
employed with Geolabs Inc. gave close to $290,000 total to the campaigns of
Harris, Apana, Cayetano and Hirono. The city BRT consulting contract
received by Geolabs is up to $468,000, though the exact amount of the BRT
contract was not disclosed by the city.
Hawaii Design Associates was fined $1,000 by the state Campaign Spending
Commission for making excessive contributions to the campaign of Harris.
This company received up to $550,100 in the contracts reviewed by Hawaii
Reporter, however the exact amount received by this company was not
disclosed on the copies of the contracts provided by the city.
Helber Hastert Fee was fined $500 by the state Campaign Spending
Commission for excess contributions to Harris and is pending prosecution by
the Honolulu City Prosecutor. This company received up to $150,000 from
the city for the BRT consulting work, though the exact amount was not
disclosed by the city on the BRT contracts.
KPMG Consulting is one of several accounting firms under investigation by
the state Campaign Spending Commission for excessive contributions to the
mayor, and is the former employer of Malcolm Tom, the third highest
official in the city. This accounting firm received up to $161,438 from the
city for the BRT, though the exact amount was not disclosed by the city.
Masa Fujioka and Associates, fined $1,000 for $2,000 in excess
contributions to the campaign of Harris, received up to $324,438 for its city
BRT consulting contract, though the exact amount was not disclosed on the
city contract reviewed by Hawaii Reporter.
Mitsunaga & Associates Inc. is owned by Dennis Mitsunaga, an individual
under investigation by the federal government for more than a year and a
half for a variety of illegalities including misusing federal construction funds
provided to the state. Known as one of the most powerful political people in
Hawaii, including a fundraiser for many high-profile Democrat candidates,
Mitsunaga had to repay the U.S. Department of Housing and Urban
Development more than $700,000 the agency considered was used
inappropriately. Mitsunaga, still under investigation by the federal
government, has a variety of companies. The one with his namesake received
up to $399,995 so far on the BRT project, though the exact amount is not
disclosed by the city.
MK Engineers is currently under investigation by state Campaign Spending
Commission for making excessive political contributions to Hawaii Democrat
politicians. They responded by saying that they discourage their employees
and associates from making political donations.*
Parsons Brinkerhoff, which is under investigation by state Campaign
Spending Commission for excessive political contributions, is one of the
primary contractors on the BRT project and has overseen more than $5
million spent on the BRT, and has outsourced some of this work to many of
the subcontractors listed in this story.
R.M. Towill is currently under investigation by the state Campaign Spending
Commission, the Honolulu Police Department and the Honolulu City
Prosecutor. At least four people employed with this company have been
arrested in recent weeks on suspicion of money laundering and making illegal
contributions to the campaign of Honolulu Mayor Jeremy Harris. This
company, one of the primary contractors on the BRT, is overseeing the
distribution of at least $1.5 million of city funds to subcontractors named in
SEY Inc., has so far been fined $32,000 by the state Campaign Spending
Commission for making "false name" contributions under names of employees
to the campaign of Honolulu Mayor Jeremy Harris. This company has
received as much as $89,000 from the city for its consulting work on the
BRT, though exact figures were not disclosed by the city.
SSFM International, the first company whose executives were charged and
arrested for their role in laundering over $400,000 in campaign funds to
Democrat political candidates including $200,000 to Harris. Michael
Matsumoto, president of SSFM Engineering in Hawaii, was recently convicted
of the first $200,000 laundering offense involving the Harris campaign. The
company also will face sizable fines from the state Campaign Spending
Commission, though that fine has not yet been determined. SSFM, one of the
primary contractors on the BRT, has overseen $1.8 million of expenditures
for the BRT, though how much of this allocation the company has received is
not disclosed in city contracts obtained by Hawaii Reporter.
The Limtiaco Group was under investigation by the state Campaign Spending
Commission for its involvement in the "pay to play" system, but the principal
of the company died, deterring further investigation at this time. The
Limtiaco Group has so far received about $32,000 from city BRT contracts.
The city did not specify on its contracts the exact amount received by the
Verner Liipfert, the powerful Washington D.C. law firm that once operated a
branch in Hawaii where both former Gov. John Waihee and Norma Wong
worked, also received contracts for the BRT, up to $97,000, though the
exact amount was not disclosed by the city. This company is not under
investigation per say, however it is included in the list because of its
connection with Norma Wong.
Norma Wong, who in addition to her own company is partner to a research
company, Mattson & Sunderland, under investigation for participating in a
money laundering scheme involving the campaign of Honolulu Jeremy Harris,
received up to $1,600,607 from the city for the BRT, though the city did
not disclose the exact amount of compensation on its contract documents....
Those opposed to the BRT project and the pay to play system say the
political pay offs already taking place need to stop and not allow the $1
billion BRT to move forward.
This report originally appeared in www.HawaiiReporter.com
March 28, 2004
Asia-Pacific forum puts us on map
By John Griffin, Honolulu Advertiser
It was an inspiring St. Patrick's Day sight — Gov. Linda Lingle and University
of Hawai'i President Evan Dobelle seated side by side, sometimes chatting
Not only that, the liberal UH leader playfully introduced the Republican
governor as "Linda O'Lingle" before her talk on "Hawai'i's Role in the Asia-Pacific Region."
Some might have viewed the occasion as a hopeful sign that the testy
relations between two of Hawai'i's most important people have somehow
evolved into a welcome detente. One can hope so.
But at the least, I saw that luncheon scene as a testimonial to the prestige
of the co-sponsoring Pacific and Asian Affairs Council, which is observing
its 50th anniversary as a vital Hawai'i organization.
The council is a nonpartisan educational institution for public- and private-school children, community-college students and adults interested in
Today, Hawai'i has a variety of organizations dealing in foreign affairs,
including the federally financed East-West Center, the Asia-Pacific
Security Center and such private groups as Pacific Forum/CSIS and the
But for a number of crucial years, the council was virtually the only game in
town on Asia-Pacific matters, aside from the underrated role of the
University of Hawai'i.
Alumni of its high-school programs include such notables as state Sen. Les
Ihara, state Rep. Galen Fox, former Lt. Gov. Mazie Hirono, AIG Hawai'i
president Robin Campaniano, Roosevelt High School principal Dennis
Hokama, Tax Foundation of Hawai'i head Lowell Kalapa, attorney Colbert
Matsumoto and international lawyer Gerald Sumida, a former council board
chairman who will receive this year's distinguished alumnus award. Roland
Lagareta, now chairman of the East-West Center's board of governors, ran
the council's high-school program from 1969 to 1977 and is one of its vice
Today, the council, which operates with a staff of five under executive
director Lisa Maruyama, is said to be in its best financial shape ever.
It gets money from state government for its educational programs, the
State Department for helping distinguished international visitors,
foundations, corporations and its 400 individual and family members.
It has what some call a symbiotic relationship with UH and its School of
Hawaiian, Asian and Pacific Studies (SHAPS) and the East-West Center,
from which it rents office space in Burns Hall....
The council will hold a big 50th anniversary dinner Friday night, and soon the
organization will be changing presidents. Veteran international attorney
Frank Boas, who has served for six years, is stepping aside in favor of Kenji
Sumida, who twice served with honor as interim president of the East-West
Center. Banker Warren Luke is board chairman....
John Griffin is former editor of The Advertiser's editorial pages and a
$ $ $
September 18, 2005
Hitman Ching dies in prison
The notorious killer succumbs
to hepatitis from past drug use
By Rod Antone, Star-Bulletin
One of Hawaii’s most notorious and cold-blooded killers, underworld hitman
Ronald K. Ching, died in Halawa Community Correctional Center of
complications from liver disease yesterday morning, prison officials said.
Ching, 56, was serving a life sentence for killing a state senator and the son
of a former city prosecutor as well as for two other murders. One of his
victims was buried alive...
In 1985 Ching was sentenced to life in prison for four organized crime
murders - state Sen. Larry Kuriyama in 1970; the 1975 shooting of the 19-year-old Charles Marsland III, son of then-Deputy City Corporation Counsel
Charles Marsland Jr.; felon-turned-government-agent Arthur Baker, buried
alive in 1978; and the shooting of gambling figure Robert Fukumoto in 1989.
Following the killing of his son, Marsland ran successfully for prosecutor.
Honolulu City Prosecutor Peter Carlisle, who helped convicted Ching as a
deputy prosecutor under Marsland, remembered talking to Ching about the
murder of Arthur Baker.
“The description of the air and sand going in his mouth when he inhaled while
he was under the ground has never left me,” Carlisle said. “There’s not many
people who can describe to you in explicit detail burying someone alive.
“He could be very cordial and charming when he was cooperating with you,
and there were other times he could be reptilian as to how cold he was.”...
In a 1985 interview with Star-Bulletin reporter Charles Memminger, Ching
said he felt remorse and pled guilty to the four murders because he was
upset with the way he had been treated by organized crime.
“I could see that the whole organized crime movement had been very greedy
- there’s been no loyalty toward me,” Ching said. “I don’t feel I owe none of
these people anything.”...
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February 9, 2005
Alleged shooter has roots in
old isle underworld
One Pali Golf Course murder suspect comes
from a legendary Waianae crime family
By Sally Apgar, Star-Bulletin
Rodney V. Joseph, allegedly one of the shooters in the Pali Golf Course
murders last month, came of age in Waianae during a legendary era when
crime bosses ordered the execution of competitors by a bullet to the head
and informants were buried alive in the sands of Maili Beach.
Joseph, 35, a professional kickboxer, is charged with first- and second-degree murder in the killing of Lepo Utu Taliese, 44, and Lawrence
“Romelius” Corpuz, 39, at the Pali Golf Course Jan. 7....
The Joseph family of Waianae is part of the storied past of Hawaii’s
underworld of the 1960s through the mid-1990s, which was vividly described
in scores of news accounts.
Federal informants called Charles “Charlie” Stevens, who is Joseph’s uncle
on his mother’s side, a drug lord and “the man” on the Waianae Coast for
more than 20 years. Stevens, also known as “Uncle Charlie” or “Old Man,”
regularly cruised his domain with his lieutenants in a black Lincoln Continental
with dark-tinted windows.
Stevens, who was married to Joseph’s aunt Aletha “None” Stevens, had a
taste for one of his own products, heroin, and died in 1999 of cardiac arrest
in a federal prison in Pennsylvania at age 56.
In the early 1990s, Stevens was the target of a state and federal
investigation that ultimately sent him to federal prison as part of a plea
He pleaded guilty to racketeering and confessed to drug trafficking,
murder and bribing a state judge to reverse a guilty verdict in a double
One FBI affidavit described an incident involving Rodney Joseph when he
was barely 20. The 1990 affidavit supporting an FBI wiretap of Stevens
recounted how Joseph allegedly helped his uncle retrieve two pounds of
crystal methamphetamine, or “ice,” from a hotel room.
The affidavit said that Mervin “Charlie” Chan “froze up and died while
mainlining crystal methamphetamine in the Plaza Hotel near the airport on
Dec. 31, 1988.”...
In 1984, Charles Marsland was an outspoken and controversial city
prosecutor who was out to nail organized crime. but Marsland’s mission had a
personal edge: He wanted to find out who had murdered his 19-year-old son,
Charles “Chuckers” Marsland III, early one morning in Waimanalo with a
police service revolver....
In 1984 the intensive work of Marsland’s organized-crime strike force and
federal investigators pinned two major underworld figures: Ronald Kainalu
“Ronnie” Ching and Henry Huihui.
Ching, who turned witness for Marsland and the state, was considered a
ruthless hit man and the state’s foremost contract killer who bore no
allegiance to any crime boss. They said he killed for money, favor and
On Aug. 23, 1985, Ching was sentenced to four life terms for the four
Huihui and Ching were both used unsuccessfully to go after former
Honolulu police officer Larry Mehau, who lived on the Big Island and was
publicly labeled by one of Marsland’s staff in the late 1970s as the
“godfather” of organized crime in Hawaii.
Mehau, who was close to former Gov. George Ariyoshi, was the target
of a federal and state investigation code named “Firebird.”
Mehau was never convicted....
The jury convicted Stevens of the murder on March 26, 1981. But in a
stunning decision that stirred angry accusations, Judge Harold Shintaku
overturned the verdict on September 28, 1981, claiming the evidence
was not there to convict.
Shintaku was harshly criticized. On Oct. 6, 1981, he made public his written
argument for acquittal. That night, police arrested him for drunken driving,
and the next morning his relatives found him in a family-owned beach cottage
at Mokuleia with multiple skull fractures and a broken collarbone. Shintaku
said he believed he had been beaten after he passed out. Police said he hurt
himself in a fall during a botched attempt to hang himself.
In 1983, Shintaku retired from the bench. The judge was arrested in a 1987
raid on an Alewa Heights teahouse in the company of Earl K.H. Kim, who
controlled gambling during that era.
Shintaku pleaded guilty to gambling charges in 1988. A year later he was
found dead after apparently slitting both wrists and jumping from the third
floor of the Stardust Hotel on the Las Vegas Strip. It was never clear
whether he committed suicide or was murdered.
Stevens confessed in 1992 that his brother, Richard “Dickie” Stevens,
who had since died, bribed Shintaku. Stevens said Shintaku had gambling
debts and that the bribe was made and accepted before the double murder
trial ever began.
On May 12, 1993, federal Judge David Ezra sentenced Stevens to 20 years
He told the court that Stevens’ prosecution ended “a criminal organization
that operated almost unchecked on the Waianae Coast for over 20
For more Racketeering in Paradise, GO TO > > > APCOA: Vultures in The
Parking Lot; Broken Trust; The Puna Connection; Investigating Investcorp;
The Indonesian Connection; RICO in Paradise; Flying High in Hawaii: Ron
Rewald and the CIA; The Vampires on Gilligan’s Island; Who’s Guarding the
Henhut?; Yakuza Doodle Dandies.
$ $ $
July 21, 2005
Former Republican Congressional Candidate
Pleads Guilty to Felony Charges Stemming from
His Campaigns for Lt. Governor, Congress
Out-of-Court Settlement Allows
Dalton Tanonaka to Avoid a Trial
By Malia Zimmerman, Hawaii Reporter
Dalton Tanonaka, 51, who ran for lieutenant governor in 2002 and U.S.
House in 2004 as a Republican, plead guilty in federal court July 21, 2005, to
three felony charges, admitting he violated federal law during his campaigns.
The State Campaign Spending Commission initiate the investigation into
Tanonaka, who is a former print and broadcast journalist, eventually turning
over the case to the city prosecutor’s office. But the federal government
took over the case almost immediately.
Law enforcement sources say Tanonaka attempted to stop the investigation
almost from the get-go by contacting powerful Republican supporters in
Washington D.C. and asking them to come to his aid. That only further
irritated investigators, who say Tanonaka was less than honest about the
seriousness of the charges pending against him....
Before U.S. Magistrate Judge Kevin Chang in U.S. District Court, Tanonaka
> Two counts of making false statements in a bank loan application
related to illegal campaign donations received during the lieutenant
governor race in 2002;
> One count of making false statements on a financial disclosure from in
2004, required for his congressional campaign; and
> One misdemeanor count related to accepting an illegal contribution in
the congressional race of $11,000.
Though he will not likely serve jail time, Tanonaka could face a maximum
penalty of 30 years in prison and a $1 million fine for the first two
felony charges and a $2,000 fine for the misdemeanor. His sentencing is
scheduled for Nov. 3, 2005....
Tanonaka continues to maintain he is innocent of all charges, but plead guilty
to avoid a trial....
For more regarding Malia Zimmerman, GO TO > > > Who’s Guarding the Hen
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Tanonaka picked to head PBEC
Hawaiian Hard Drive
Dalton Tanonaka has been named as the new president of the Pacific Basin
Economic Council (PBEC). PBEC represents more than 1000 international
companies across 20 nations who have a total work force of 10-million
people and revenues exceeding $4 trillion.
“Dalton’s experience and skills are exactly what we need to move PBEC’s
agenda forward,” said PBEC Chairman S.R. Cho. “His credibility and ideas
will help us reemphasize our role as the business voice of the region.”
Tanonaka worked at CNN International where he served as a main news
anchor and recently left that position to run unsuccessfully for Lieutenant
Governor. He has also worked as the City and County of Honolulu’s
Some Tanonaka’s goals include generating more interest from Far East
Countries to do business here in the state, positioning Hawaii as the Pacific’s
economic hub and convincing local business and government leaders of the
importance of keeping PBEC based in Honolulu....
See also: www.pritchettcartoons.com/expert.htm
For an update, GO TO > > > www.ilind.net/2005/november/oct30-nov05.html
For more on PBEC, GO TO > > > Act 221; Broken Trust; The Indonesian
Connection; Paradise Paved; Vultures of the Sandwich Isles; Yakuza Doodle
Dandies ... and www.keithpr.com/pacificall
$ $ $
June 2, 2005
Governor's Top Campaign Promise Still Not Kept
Two and Half Years Into Her 4-Year Term, A Hawaii Reporter
Investigation Reveals Governor's Top Administrators Have Done Virtually
Nothing to Clean Up Political Corruption in the State, Or Stop the Pay
to Play System
By Malia Zimmerman, Hawaii Reporter
The first in a series
When Linda Lingle ran for governor of Hawaii on the Republican ticket in
1998 and 2002, one of her top three campaign promises, in addition to
reforming the state’s public school system and boosting the economy, was to
"clean up political corruption."
That priority was welcomed by a tired public that had watched for more than
a decade as numerous Democrat politicians entrusted with the taxpayers’
wellbeing went to prison for corruption, fraud, campaign violations, abuse of
taxpayer funds, tax evasion and a host of other crimes. A weary public that
had seen the House Speaker, prominent city officials and then campaign
spending director Jack Gonsalves go to prison. An increasingly cynical public
that had seen then Gov. Benjamin Cayetano invoke what some called "a reign
of terror" on people he deemed his political "enemies," using his tremendous
gubernatorial powers and vast taxpayer funded resources to target critics.
However, two-and-a-half years into her 4-year term, an investigation by
Hawaii Reporter shows Lingle’s administration –- mainly the state attorney
general and the Department of Accounting and General Services -- have
done virtually nothing to clean up political corruption, especially in the areas
of government procurement.
This despite the fact that the Honolulu City Prosecutor, Honolulu Police
Department, state Campaign Spending Commission, FBI, IRS and U.S.
Attorney have aggressively pursued company officers and owners who, in an
effort to obtain favoritism in government contracts, concessions, zoning and
permitting, violated state campaign spending law.
These agencies undertook independent investigations into whether then
Honolulu Mayor Jeremy Harris’ top advisors were extorting money from
businesses seeking permits, contracts, concessions or zoning from his city
administration. They also looked into whether the businesses were paying up,
getting around campaign spending limits by using family members, friends,
vendors and business associates to funnel illegal contributions through.
Four years later, these investigations into Harris and his supporters resulted
in nearly 100 companies and their top officers being fined a collective $1.5
million by the state Campaign Spending Commission. Bob Watada, executive
director of the state Campaign Spending Commission, estimates more than
$1.5 million of Harris’ campaign war chest –- half of what Harris raised from
1996 to 2001 –- was illegally contributed, though Harris and his top officials
deny any knowledge of the violations or the pay to play scheme.
The Honolulu police and city prosecutor followed up on several of these
violations, criminally pursuing corporate officers for money laundering and
making "false name" contributions. Unfortunately, law enforcement officers
say, the vast majority of the judges who have heard the corruption cases,
have let the corporate officers off with fines and deferred acceptance
pleas, allowing them to wipe their record clean with time and good behavior.
The U.S. Attorney filed charges against two companies for tax evasion
including Thermal Engineering and GEO Labs, with plans to continue
prosecuting other companies that violated federal tax laws in an effort to
launder money to politicians. Federal judges have so far taken the campaign
violations much more seriously than their counterparts in the state.
But law enforcement officers say the only punishment these corporate
officers will understand –- a punishment that will stop them from
participating in the pay to play scheme –- is having their right to bid on
contracts and thus their ability to make a profit from government work
removed all together.
Fines -- even substantial ones imposed by the court or the state Campaign
Spending Commission -- are easily absorbed by the company, which can then
turn around and get more government work.
Liberal state judges who in one case compared money laundering to
politicians as a crime equivalent to a traffic ticket, are letting the corporate
offenders go free with no jail time and typically a deferred acceptance,
allowing them to wipe their record clean within a designated time period.
Lingle administrators do not say much about their reasons for not pursuing
debarment against the more serious offenders, but did tell Hawaii Reporter
they are dealing with a complicated new procurement law that makes it more
difficult to successfully debar companies that commit campaign violations.
Wielding the Heavy Hammer on Political Corruption
The state Department of Accounting and General Services, which oversees
procurement in the state, has traditionally had the authority to "debar"
companies fined more than $5,000 by the state Campaign Spending
Commission or whose officers have been prosecuted criminally for campaign
spending violations. That "right" was reinforced by a 2003 procurement bill
signed into law by Gov. Linda Lingle that same year.
Those trying to implement the legislation say it has numerous flaws. The law
puts more mandates and a higher requirement for burden of proof before
debarment on the state. However, the law can still be used as a deterrent
against businesses that egregiously violated the state campaign spending
laws, law enforcement and industry sources say.
But since taking office, Lingle has not wielded this heavy hammer handed to
her by lawmakers. Her administrators have not initiated any debarment
proceedings against any company whose officers have violated campaign
spending laws, according to interviews Hawaii Reporter has conducted with
Russ Saito, the director of the Department of Accounting and General
Services, procurement personnel within the department and Hawaii’s law
This despite the fact that more than 30 companies, according to public
record, could be debarred, according to state law, for their campaign
Lingle’s administration continues to allow such companies as SSFM, whose
president Michael Matsumoto laundered $400,000 to local Democrat
politicians including $200,000 to the campaign of Honolulu Mayor
Jeremy Harris, continue to get millions of dollars in work from the
Thermal Engineering, whose officers conspired to launder money through
workers and relatives to local Democrats including Honolulu Mayor
Jeremy Harris, and whose officers are being criminally prosecuted by
the federal government, is still able to qualify for state and county
R.M. Towill, whose president Donald Kim pled no contest to violation of
campaign spending laws after laundering along with his vice president
Russ Figueroa, even more money than SSFM to Harris and others, can
bid on and win state and county jobs.
Wesley Segawa, son of former Big Island Representative Herbert
Segawa, and cousin of Dennis Mitsunaga, who also is under
investigation by the city prosecutor, can procure state work, even
after he laundered money through friends and relatives for Harris.
Gary Okamoto of Wilson Okamoto and Associates, also can vie for state
contracts, even after his wife pled no contest to making at least
$60,000 in contributions on behalf of the company to Harris and paid
a fine of $45,000 to the state Campaign Spending Commission.
Ed Noda of Ed Noda and Associates can be awarded state contracts
despite laundering at least $80,000 to Harris and Cayetano and
subsequently covering up his crime when investigators questioned him.
Noda was fined $55,000.
The Lingle’s administration also continues to allow GeoLabs, the first
company fined by the state Campaign Spending Commission in this
series of investigations, to be qualified for state and county work, even
though its officers laundered over $100,000 to campaign of Harris,
Cayetano, Apana and was fined $65,000.
In stark contrast to the state, the federal government is taking action in an
attempt to stop taxpayer dollars from going to politically corrupt companies.
Some federal agencies that procure government work in Hawaii are currently
investigating a number of firms that were fined or prosecuted by the local
government to determine if they should be debarred either temporarily or
permanently from federal work.
So What’s the Problem?
Why isn’t the Lingle administration debarring companies that commit
politically motivated crimes?
Especially when a Republican administration can use the opportunity to stomp
out Democrats’ supporters and the Democrats’ primary money stream before
the 2006 election when Lingle is up for re-election against a Democrat
Her administrators point fingers at the legislators and each other.
The procurement division personnel under the state Department of
Accounting and General Services say lawmakers ignored testimony by Aaron
Fujioka, then the chief procurement officer for the state, who said the law
would actually make it more difficult to build cases against the contractors
who violated campaign spending laws.
Before Fujioka left the state procurement office this Spring, he had
prepared a debarment case against SSFM, but sources say the case was
rejected by the state attorney general.
Russ Saito, director of the state Department of Accounting and General
Services, and an appointee of the governor, says his department has not
proceeded with any debarment hearings because of problems with the law.
He says firms that violate the campaign spending laws can be debarred in two
ways. First, if they are convicted, and second, if they are not convicted but
are fined more than $5,000 for violations committed after the rule went
into effect in 2003, they may be debarred by the Chief Procurement
officer. For violations before 2003, it is more difficult but possible to debar
subject to the debarment statute in the Hawaii Revised Statutes, Saito
says, claiming the burden of proof is "high."
Mark Bennett, the state attorney general, would not return numerous calls
made by Hawaii Reporter to his office about the status of debarment
proceedings against the more than 30 companies that could be debarred for
political corruption under Hawaii law.
Follow up calls made to him through the governor’s policy advisor and press
secretary also were not returned, though Bennett has willingly commented on
several other stories in Hawaii Reporter.
$ $ $
March 25, 2005
Local 5 Sues Unity House
By Jim Dooley, Honolulu Advertiser
The Hawai’i hotel-restaurant workers union has filed a civil racketeering
lawsuit against Unity House Inc., charging that former president Anthony
Rutledge Sr. and other officers used Gov. Linda Lingle’s chief of staff
Robert Awana, former state Rep. Romeo Mindo and others to divert millions
of dollars of Unity House money for the personal benefit of Rutledge, his
family members and associates.
The lawsuit, filed in federal court last weekend, does not name Awana as a
defendant but calls him a “co-conspirator and/or wrongdoer” in an alleged
scheme to defraud the nonprofit labor organization of assets.
Awana could not be reached for comment yesterday. His attorney, state
Sen. Colleen Hanabusa, D-21st (Nanakuli, Makaha), yesterday said, “I don’t
know anything about the suit. I can’t comment.” Hanabusa said in January
that Awana testified before a federal grand jury investigating Unity House
but was told he was not a target of the investigation.
Mindo’s attorney Eric Seitz said he hadn’t seen the suit and had no comment
on it. He has previously said Mindo, a former Unity House employee,
committed no wrongdoing.
The racketeering lawsuit was filed Sunday by the union and Eric Gill, head of
the Hotel Employees and Restaurant Employees Union Local 5 and a
longtime opponent of Tony Rutledge. Fourteen other officials and members
of Local 5 are plaintiffs in the suit seeking unspecified monetary damages
from the senior Rutledge and other defendants.
The lawsuit repeats many allegations in a criminal fraud case against Tony
Rutledge and his son Aaron, a former Unity House executive. That case is
scheduled to go to trial in federal court in May. Some of the allegations
contained in the suit are also drawn from records introduced in court after
federal agents seized control of Unity House Dec. 14.
IRS agent Gregory Miki said in a sworn statement justifying the Unity
House seizure that, “The unchecked use of Unity House contracts and
monies have resulted in political influence that has opened doors from
which (Tony) Rutledge has benefited personally.”
One example cited by Miki was a “generous consulting contract” that Unity
House gave Awana in 1999-2000 to survey union members. The Local 5
lawsuit said the value of the contract was $250,000 and the survey
“included questions on whom they would vote for in the upcoming mayoral
and other elections.”
The suit also repeated an allegation from Miki that Rutledge met with
Awana 11 times after Awana became Lingle’s chief of staff in 2002.
Jeff Rawitz, defense attorney for Tony Rutledge, declined comment on the
lawsuit other than to note that it was filed for Local 5 by T. Anthony Gill,
brother of Eric Gill.
“That has the appearance of a conflict of interest because the brother who
filed the lawsuit stands to make money from it regardless of the merits of
the case,” Rawitz said.
T. Anthony Gill declined to respond to Rawitz’s statement.
Brian DeLima, attorney for Aaron Rutledge, said he had not seen the suit
and could not comment on its contents....
Prominent Honolulu criminal defense attorney Michael Green, a former
Unity House director, is also named as a defendant in the lawsuit. His
office said yesterday Green was out of state and unavailable for comment.
David Louie, an attorney who represents another defendant, former Unity
House director Arlene Hae, was unavailable for comment yesterday on the
Hae this month filed a legal protest against the government’s “usurpation of
control” of Unity House, saying the takeover “impairs and impedes” the
ability of Hae and other officers and directors to protect the rights and
assets of Unity House.
In response, Anthony Pounders, the receiver appointed by federal court to
run Unity House while the criminal case against the Rutledges is pending,
said: “Even if some members of the prior management were not directly
involved in any corporate mismanagement or malfeasance, I have found no
evidence of any attempts to expose, investigate or otherwise stop such
mismanagement or malfeasance.”
Pounders said the net worth of Unity House declined from $49 million at the
end of 2001 to $31 million today, owing largely to bad investments.
He also said Unity House last year was billed $793,000 in legal expenses to
defend the Rutledges in the federal criminal investigations.
Unity House has paid $50,000 a year for insurance coverages of its
officers and directors but “failed to make a claim” for insurance
coverage* of the legal bills, Pounders said.
“Instead, Unity House used its own money to pay Anthony Rutledge Sr.’s
attorneys’ fees,” said Pounders.
Rutledge lawyer Rawitz yesterday declined comment on Pounders’
* (Catbird Note: Hmm.... An organization not filing claims when they
have insurance? Attorneys Eric Seitz and Michael Green? Smell
familiar? Go sniff out Claims By Harmon, Dirty Money, Dirty Politics &
Bishop Estate), and RICO in Paradise.
~ ~ ~
For more on Gov. Linda Lingle, Colleen Hanabusa, Robert Awana, and Eric
Seitz, GO TO > > > The Grand (and dirty) Ko Olina; Who’s Getting Into
Hawaii’s Act 221?
$ $ $
January 5, 2004
Campaign donation scandal rocks Hawaii
HONOLULU (AP) – Behind his state-issue desk in a small fourth-floor office
sits a slightly built, soft-spoken man who has managed to shake Hawaii’s
power structure to its core.
During the past two years, Robert Watada and his staff at the state
Campaign Spending Commission have respected architects and engineers
illegally made political donations in the names of their employees, wives and
children, allegedly to win government contracts.
The results of the investigation so far: nearly $1 million in fines, jail time for
a prominent lawyer, community service for business leaders, and the
resignation of a Honolulu police commissioner.
“It’s what I get paid for,” said Watada, the commission’s executive director.
“I believe our system requires all of us in the democracy in which we live to
follow the laws.”
The civil and criminal reckoning has also been an embarrassment for some of
the state’s most influential Democrats and played a role in giving Hawaii its
first elected Republican governor in 40 years.
Under state law, individuals can donate no more than $6,000 to gubernatorial
candidates and $4,000 to mayoral candidates. Watada found that some
businessmen were subverting the law by making donations in other people’s
Watada’s persistence has led to a slew of investigations by Honolulu
Prosecuting Attorney Peter Carlisle, who says he hopes to end a “pay for
play culture” that has plagued Hawaii’s Democrat-dominated government for
The cases involve such things as $10,500 in donations over a five-year period
in the names of three modestly paid Chinese-restaurant workers, and a
$2,000 donation that supposedly came from a high school student.
The biggest fine was $303,000 levied against engineering executive Michael
Matsumoto for allegedly laundering more than $400,000 in illegal
contributions to Honolulu Mayor Jeremy Harris and other Democrats.
Matsumoto, chief executive of SSFM International Inc., which won more
than $7 million worth of city contracts, pleaded no contest to funneling
money to family members and employees to donate to Harris’ campaign and
was sentenced to 300 hours of community service.
Still, there has been no direct evidence that the illegal contributions
influenced the awarding of state and local government contracts.
And so far, the scam’s chief beneficiary, Honolulu’s mayor, has not been
publicly implicated. His attorney has said the may never solicited or
knowingly accepted illegal contributions.
After a rapid rise in politics, Harris abruptly dropped out of the 2002
governor’s race in the midst of the investigation. Republican Linda Lingle
went on to win the election. The mayor’s term ends in a year.
Lingle made political corruption a top campaign issue and won passage of a
government-procurement reform law in her first year in office.
Since the probe began, the commission has levied fines against 75 companies
for making illegal contributions to Democrats such as Harris, former
Democratic Gov. Ben Cayetano, former Maui County Mayor James Apana
and former Lt. Gov. Mazie Hirono. Up to 40 more companies are still being
Among those convicted was former Hawaii Bar Association President
Edward Y.C. Chun, 71. Chun was the first to get jail time – 10 days. Nearly
20 others have been arrested and booked for investigation.
Also, Leonard Leong resigned as Honolulu police commissioner after being
fined for illegal campaign contributions to the mayor.
The scandal has involved mostly design and engineering firms, while county or
state construction projects or product purchases require competitive
bidding, design contracts have been decided subjectively by public officials....
Stanley Kawaguchi, former national president of the American Council of
Engineering Companies, said that before the scandal, political contributions
had “effectively become mandatory.”
“The widespread perception was that you had to pay to play,” he said.
“The old system really gave our industry a black eye.”
Apparently it had been going on for decades. Watada said one retired
engineering company president told him that when he started 30 years ago,
contributions of $25 or $100 would help in getting city contracts.
Watada said the investigations and changes in the law have curbed the illegal
practices for now.
“But I’m realistic. When there’s money involved and politics involved and
power involved, whether it’s in Hawaii or New Jersey or anywhere else,
it’s something the public always has to be vigilant about,” he said.
$ $ $
March 16, 2004
Harris donor arrested for gifts
The former CEO of an isle firm
had given $80,250 to the mayor
By Rick Daysog, Honolulu Star-Bulletin
Honolulu police arrested the former head of one of the state’s largest
engineering firms yesterday for allegedly making illegal political
contributions to Mayor Jeremy Harris.
Larry Matsuo, former chief executive of Park Engineering, was booked at
police headquarters on suspicion of money laundering and making political
donations under a false name.
Matsuo was not charged and was released pending investigation.
He was not available for comment, and his lawyer Darwin Ching could not be
Money laundering is a felony punishable by up to 10 years in prison. Making
a political donation under a false name is a misdemeanor punishable by up to a
year in jail....
Until recently, Matsuo headed Park Engineering, a local government
contractor linked to more than $115,000 in political donations to Harris,
former Gov. Ben Cayetano and ex-Maui Mayor James “Kimo” Apana....
Founded in 1958, Park Engineering is one of the state’s largest engineering
firms, receiving more than $5.5 million in nonbid consulting work from the
city during the past eight years....
For more, GO TO > > > APCOA: Vultures in The Parking Lot
~ ~ ~
For more on James “Kimo” Apana and the Maui connection, GO TO > > >
Paradise Paved; Claims By Harmon; The Harmon Arbitration
$ $ $
September 05, 2002
Sparks fly over campaign reform
By Crystal Kua, Honolulu Star-Bulletin
The only sitting member of the state Legislature who is running for
lieutenant governor was taken to task by two of his Democratic opponents
for an exemption state lawmakers gave themselves in a campaign spending
reform measure passed this session.
"If you're going to exempt the Legislature, then why even have the law?"
asked Donna Ikeda, a former member of both the Legislature and Board of
Education. "If you're going to pass something, it should apply evenly across
Ikeda's comments followed state Sen. Matt Matsunaga's assessment of a
bill that would have prohibited companies or people who do business with the
city or state from donating to candidates for mayor or governor. Gov. Ben
Cayetano vetoed the bill because of an exemption for the Legislature.
The exchange came during a live televised debate on 'Olelo Community
Television between Ikeda, Matsunaga, Office of Hawaiian Affairs trustee
Clayton Hee and entertainment industry promoter Marvin Franklin....
One of the more lively verbal exchanges came when moderator Bob Rees
asked all four candidates whether campaign finance reform is needed.
"Yes, absolutely," Matsunaga said. "We had a wonderful opportunity this past
legislative session. We passed a very good bill. It may have had a few flaws,
but it was a good bill to try and break the connection between campaign
contributions and state contracts. And, unfortunately, the governor vetoed
it, but perhaps we can pick that up later."
Ikeda was quick to respond.
"Well, there's a reason why the bill was vetoed: The Legislature exempted
itself from the coverage," she said.
"Well, it should apply," Matsunaga said, "but the reason why the Legislature
was exempted is 'cause the Legislature doesn't award the contracts. It's
the executive branch that actually awards the nonbid contracts, and I have
no problem with putting the Legislature ..."
But before Matsunaga finished, Ikeda interrupted, "Let's be honest ...
legislators have a way of picking up the phone, calling up and putting pressure
on people to do things. That happens all the time."
She also said lawmakers should not be exempt "because by being exempt,
they can profit from the very kinds of contributions that everybody else is
supposed to be prohibited from receiving."
Matsunaga continued, "I guess I'm not familiar with the legislators that pick
up the phone and twist arms."
Ikeda responded, "Oh, come on, Matt."
Hee then weighed in, saying that the Legislature should not be let off the
hook "because if Matt is right, what's the harm with the exemption falling to
the legislators? But in fact Matt is not right."
As an example, Hee pointed to a $75 million tax credit the Legislature gave
to the Ko Olina developers for construction of a world-class aquarium.
"That's a way of packaging a project that has great financial
implications to certain developers, and to me that must stop," Hee said.
Hee said certain lawmakers have said that they like the way the situation is
"But that's what I meant when I said business as usual cannot continue.
"Going along to get along must stop," he said....
For more, GO TO > > > The Grand (and dirty) Ko Olina
* * *
July 4, 2002
Anzai says airport probe growing
He said a kickback scheme could become
the largest waste of state taxpayer dollars ever
By Rod Antone, Honolulu Star-Bulletin
State Attorney General Earl Anzai says his department's investigation into
an alleged Honolulu Airport maintenance kickback scheme could be the
largest waste of state taxpayer dollars ever, with the potential of surpassing
the $5.5 million lost in the city's Ewa Villages scandal.
"The scope of the problem seems to be increasing all the time," Anzai said
yesterday. "It just seems to be getting bigger and bigger."
Yesterday, state investigators arrested three people whom authorities say
were involved in a scheme that inflated the cost of hundreds of maintenance
projects and offered kickbacks to some airport employees.
Authorities arrested Richard Okada, administrator of the Airports
Division's Visitor Information Program, in a bribery investigation. They also
arrested Richard I. Namba, president of R.I. Namba Construction, in a
bribery and first-degree theft investigation and his daughter, Jodie Y.
Namba, in a first-degree theft investigation. Jodie Namba is the company's
Last week, investigators arrested maintenance superintendent Dennis
Hirokawa and airfield and grounds maintenance supervisor Antonio Bio.
Hirokawa was arrested for investigation of first-degree theft and bribery,
and Bio was arrested for investigation of second-degree theft. Both men also
were released pending investigation.
Anzai said that in 1999 between $7 million and $8 million was spent on
airport maintenance projects, more than double the $3 million to $4 million
usually spent annually by the department.
Most of the work was for small-contract projects under $25,000 and
involved minor repairs such as cracks in floors, holes in walls and replacing
ceramic tile. Anzai would not say exactly how many projects his department
was looking at, only that there were hundreds of them.
"Basically all the projects are suspect," he said.
Though the focus is on the fiscal years 1999 to 2000, Anzai said
investigators are looking as far as back 1995 or even earlier. Anzai also said
some "contractors" who received kickbacks may have not done any work at
"Many or most of them ran their businesses out of their houses and in fact
may have subcontracted actual work," Anzai said.
"For example, company X gets the bid, but company X doesn't really have a
contractor's yard, equipment, etc., and the work is done by company Z."
Anzai said one company in question received up to $1.6 million in airport
maintenance projects over a one-year period. Anzai said he does expect
more arrests to be made next week....
For more kickbacks at Honolulu International Airport, GO TO > > > Hawaiian
Airlines: Flying with the Bankruptcy Buzzards
$ $ $
October 27, 2002
Mayor’s Palau trip not reported
A spokeswoman says city attorneys ruled the air fare
and hotel stay did not constitute a gift
By Rick Daysog, Honolulu Star-Bulletin
Honolulu Mayor Jeremy Harris did not disclose that the Republic of Palau
paid for his travel to an environmental conference earlier this summer, in
what one city councilwoman said is symptomatic of the Harris
administration’s lack of openness.
But a city spokeswoman said that the mayor did not list the trip in his annual
disclosure report with the Office of the City Clerk after city attorneys
determined that it was not a gift.
Harris was in Palau in late June at the invitation of its president Tommy
Remengesau Jr. to deliver the keynote speech for the 21st annual Pacific
Islands Environment Conference at the Palasia Hotel in the city of Koror.
The Palau government agreed to pay for Harris’s air fare and hotel costs for
the June 24-28 conference, which attracted more than 200 environmental
experts and government officials from about a dozen countries, said Tom
Yocum, one of the enent’s organizers and an official with the Environmental
Yocum, and EPA wetlands expert, said he could not recall the total costs, but
that the Palau government received a discounted, $824 air fare with
Continental airlines for the mayor. Typically, two-way fares for Honolulu to
Palau flights range between $1,600 and $2,000, he said.
Under city ethics laws in effect at the time, elected officials are required to
list all gifts that they receive from outside sources. Such gifts include any
form of money, goods, services, loans, entertainment, lodging and travel that
comes from a donor that has an interest before the city official.
(The city’s ethics law was amended earlier this year to ban all gifts above
$200. but the amended law, which took effect July 1, eliminated the
reporting requirements for gifts.)
The Palau trim came less than a month after Harris dropped out of this
year’s governor’s race. At the time, Harris was considered the Democratic
City spokeswoman Carol Costa said city attorneys advised the mayor’s staff
in July that the Palau trip is not a gift and should not be included in Harris’
gift disclosure form....
City Councilwoman Ann Kobayashi said the omission of Harris’ Palau trip
illustrates his administration’s lack of candor.
Kobayashi, a frequent critic of the Harris’ fiscal policies, said the
administration has been reluctant to disclose information that should be
“It’s a question of accountability,” Kobayashi said. “Why don’t they just
disclose these things? What is there to hide?”
Under city law, failure to disclose a gift could result in penalties as severe as
impeachment of an elected official. The corporation counsel also could sue a
donor or a recipient if a gift is not disclosed.
In his July 31, 2002, gift-disclosure form, Harris revealed that he received
more than $21,000 in gifts during the past year, including several honorary
memberships to exclusive clubs such as the Waialae Country Club, the
Pacific Club and the Mid-Pacific Country Club.
The report, which covered July 1, 2001, through June 30, 2002, also said
that Harris and his wife, Ramona, each received annual parking passes
worth $100 from APCOA Inc. The couple also received movie passes
valued at $175 each from Consolidated Theatres, Wallace Theatre and
Chuck Totto, executive director of the City Ethics Commission, declined to
comment on Harris’ gift report....
For more on APCOA Parking, GO TO > > > APCOA: Vultures in the Parking Lot
$ $ $
June 22, 2002
Inquiry targets Dem donors
A federal grand jury issues subpoenas to an engineering
firm linked to donations
By Rick Daysog, Honolulu Star-Bulletin
A federal grand jury is investigating political contributions by local
contractors to the campaigns of Honolulu Mayor Jeremy Harris and other
The secret panel recently issued subpoenas to the local engineering firm
SSFM International Inc., which is linked to nearly $200,000 in political
donations to Harris, Gov. Ben Cayetano, Lt. Gov. Mazie Hirono and Maui
Mayor James "Kimo" Apana, according to people familiar with the inquiry.
The subpoenas are believed to be the first by the grand jury, which appears
to be targeting companies that the state Campaign Spending Commission says
funneled campaign contributions through their employees.
The federal inquiry coincides with a parallel criminal investigation by city
Prosecutor Peter Carlisle into the Harris 2000 re-election campaign and its
Steven Hisaka, an attorney for SSFM, could not be reached for comment.
The Office of the U.S. Attorney had no response. A lawyer for the Harris
campaign also had no comment, saying the federal investigation does not
target their campaign.
Harris, the former front-runner for this year's Democratic gubernatorial
race, dropped out of the election last month, citing weak poll results.
The FBI and the U.S. Attorney's office have contacted several local
engineering and architecture firms as part of the same federal inquiry, while
the Internal Revenue Services' criminal division is looking at whether any of
the donors violated federal tax laws.
Phillip Li, an attorney representing several local engineering firms, said that
federal authorities have interviewed some of his clients, who are cooperating
But Li, a former commissioner with the state Campaign Spending Commission,
declined to identify the companies or give further details.
SSFM is one of the state's largest engineering firms with millions of dollars
in state and city contracts.
The Star-Bulletin previously reported that relatives of SSFM's officers
made about five dozen contributions worth nearly $200,000 to some of the
isles' top-ranking Democrats.
More than $92,000 went to Harris' 2000 mayoral campaign, while
Cayetano's 1998 re-election campaign received about $71,000. Apana's
campaign raised about $30,000 from people linked to SSFM. The Hirono
campaign received $4,050 in 1998.
The state Campaign Spending Commission has alleged that SSFM operated a
special banking account in which the firm's officers were able to transfer
company money to friends and relatives for political contributions.
The federal grand jury investigation comes as SSFM is contesting several
administrative subpoenas issued by the commission for banking and other
financial information held by the firm and its officers.
SSFM has argued that the commission does not have jurisdiction since it
referred its probe of the Harris campaign to the city prosecutor's office
for a criminal investigation.
However, the commission has argued that it is entitled to the records since
it did not refer its investigation into SSFM to the prosecutor's office.
* * *
June 22, 2002
Hawaii warned of
asbestos in homes
A Montana mine sent potentially
dangerous vermiculite to Hawaii
By Helen Altonn, Star-Bulletin
The U.S. Environmental Protection Agency cautioned consumers who suspect
they have asbestos-contaminated vermiculite insulation in their homes not
to disturb it.
Hawaii has been identified among states receiving vermiculite from Libby,
Mont., where it has been linked to 200 deaths and 750 illnesses.
Federal health officials are trying to determine if ore mined in that area and
shipped across the country may have spread potentially fatal asbestos.
Lung cancer and fatal asbestos poisoning rates in Libby are 40 to 60 times
higher than would be expected, the Associated Press reported.
The high rates have been blamed on asbestos contamination, caused by
breathing in the dust from the vermiculite.
W.R. Grace & Co. closed the mine in 1991 after 67 years of operation and
is now in bankruptcy.
"We are very concerned about the other sites that have received asbestos-contaminated vermiculite," said Henry Falk, assistant administrator of the
Agency for Toxic Substances and Disease Registry in the U.S. Health and
Human Services Department.
The EPA identified 240 sites in 40 states where vermiculite was shipped
from Libby but said it hasn't found asbestos poisoning at those sites similar
to what occurred at Libby.
Vicki H. Tsuhako, manager of the EPA-Pacific Islands Office, was trying
yesterday to learn more about the situation in Hawaii. Meanwhile, she
referred inquiries to the EPA Web site.
The public health crisis at the Montana ore-mining town caused concern
about the problem spreading to other towns where vermiculite was shipped
to be processed in soil conditioner and home insulation.
At least 22 sites require some kind of EPA-overseen cleanup, Marianne
Horinko, assistant administrator of the EPA's Solid Waste and Emergency
Response Office, told the Senate Superfund subcommittee Thursday.
They are in New Jersey, New York, Maryland, Pennsylvania,
Massachusetts, Kentucky, Minnesota, Colorado, North Dakota, Arizona,
California, Hawaii, Oregon and Washington.
Horinko told the Senate committee, "We have not found a pattern of
asbestos contamination that in any way approaches what we've seen at
Libby." However, Sen. Patty Murray, D-Wash., questioned why the sites
aren't already designated for Superfund status, as was Libby.
If disturbed, fibers can be inhaled and trapped in the lungs where they may
cause diseases developing many years after exposure. Left alone, the
particles won't become airborne.
If the material must be removed or disturbed because of renovations,
consult an accredited asbestos contractor for tests, information and advice,
the EPA advises.
More information on asbestos and health-related information may be
obtained on EPA's TSCA Hotline, 1-202-554-1404, or from the EPA asbestos
Web site: www.epa.gov/ asbestos....
For more, GO TO > > > Marsh & McLennan: The Marsh Birds
* * *
June 25, 2002
Kickback probe nets 2 airport officials
By Jim Dooley, Honolulu Advertiser
Two state airports officials were arrested this morning by the state
Attorney General's office, suspects in a widening investigation of an alleged
cash-for-contracts kickback scheme at Honolulu International Airport.
Arrested were Dennis Hirokawa, the airport's maintenance superintendent,
and Antonio Bio, maintenance supervisor.
Neither man had any comment as the pair were led away in handcuffs from
the main terminal at the airport.
A third suspect in the case, Richard Okada, is on emergency leave from his
job as statewide director of the airports Visitor Information Program and
was not at the airport when Hirokawa and Bio were arrested.
The Attorney General's office had no comment on the arrests, but chief
investigator Donald Wong said more information may be released later today.
Bio was arrested last week by state sheriff's deputies in a separate
investigation of theft of plants from the airport, officials said.
Today's arrests follow a raid by state investigators last week of the offices
of Hirokawa and Okada at the airport.
The investigation centers on millions of dollars in airport construction
and repair contracts awarded by airport personnel to private firms since
Chief investigator Wong said last week the case involves "allegations of
forgery, conspiracy to commit theft, theft and bribery related to small
A small, select group of contractors are alleged to have inflated bills for
airport work and kicked back cash and other gratuities to airport personnel
participating in the scheme.
$ $ $
April 4, 2002
Advocates Of Casinos Spent Big On Lobbying
Mainland investors who want to open two casinos on O'ahu spent more money
touting their agenda before lawmakers at the start of this legislative session
than any other group, state Ethics Commission records show.
Marketing Resource Group, of Lansing, Mich., reported spending $108,679
on lobbying through January and February, the period covered by lobbyist
expenditure reports due at the commission yesterday.
The company is a public relations firm employed by investors in a Detroit
casino called MotorCity, and last year set up an organization of supporters
here called Holomua Hawai'i, named after the Hawaiian word for progress.
The casino investors include Marian Illitch, whose family owns the Detroit
Tigers baseball team and Little Caesars pizza chain. They want to build
casinos in Waikiki and Leeward O'ahu, and Holomua Hawai'i collected
petition signatures from 25,000 Hawai'i residents who support gambling.
The group also produced a video in which economists and others argue that
gambling would create jobs, provide more government revenue, and boost the
But others said they fear gambling could increase crime and corruption, and
lawmakers roundly rejected a bill that would authorize the casinos, leaving it
very unlikely that the state will legalize gambling this year.
Marketing Resource Group could also be fined for failing to disclose its
lobbying activities to the Ethics Commission for the previous reporting
period, from May to December.
Commission executive director Dan Mollway said organizations that employ
lobbyists and refuse to file reports could be fined up to $500, but most
comply voluntarily. [Catbird: Guess that’s the high cost of doing business in
Marketing Resource Group could not be reached for comment yesterday.
The firm's Hawai'i lobbyist, John Radcliffe, said he did not know why the
report was missing, but that it had been lost in a Michigan snow storm when
it was first mailed. The report was due at the commission by the end of
Another group that wants to legalize gambling, the Coalition for Economic
Diversity, reported spending $9,832 lobbying during the previous period and
said it spent less than $10,000 in January and February.
The group is backed by Sun International Hotels Ltd., which wants to build
a $1 billion resort and casino at Ko Olina in Leeward O'ahu.
Hawaiian Airlines reported spending $8,300 on lobbying during January and
February. Hawaiian, which sought to merge with rival Aloha Airlines, had
reported spending more than $140,000 on lobbying during the previous
But Hawaiian later said it had mistakenly inflated that figure by including
payments for work other than lobbying. In an amended report, Hawaiian said
it really spent only $8,250 on lobbying during the May-December period.
The company had initially reported paying more than $83,000 to lobbyist
Lyn Anzai, wife of state Attorney General Earl Anzai, whose office was
investigating whether the merger would be legal.
The amended report reflects no lobbyist payments between May and
December to Lyn Anzai, who is also Hawaiian's general counsel. The report
for January and February said Anzai was paid $2,043 for lobbying during
For more, GO TO > > > Hawaiian Airlines: Flying with the Bankruptcy Buzzards
$ $ $
Nepotism, Sole-Source Contracting,
How OHA, Hawaiian Homelands, and Kamehameha School/Bishop Estate
Make Rich Hawaiians Even Richer at Everyone Else's Expense
by Kenneth R. Conklin, Ph.D.
This web-page was started in December, 2001 after a new version of the
Native Hawaiian Recognition Bill was introduced in Congress: S.1783. The
new bill contained a curious section that was never a part of earlier versions
of the bill. This Section 9, entitled "Ethics," is an explicit waiver of the
federal law that prevents people from holding federal government positions
where they or their close relatives and family members can profit from the
decisions they make.
The main supporters of the Hawaiian Recognition bill are huge, wealthy
institutions whose administrators and staff stand to profit enormously if the
bill is passed. Thus, it was clear why Section 9 was included in the bill. These
people are shamelessly exploiting the Hawaiian grievance industry, getting
land, money, and power for themselves by claiming to work on behalf of poor,
Passing the bill will let them pass lots of other bills -- i.e., passing the Native
Hawaiian Recognition Bill will give land, money, and power to large
institutions and wealthy Hawaiians, allowing them to pass along to everyone
else their BILL for housing, healthcare, education, infrastructure
development, and lavish lifestyles.
Party on! ...
AN UPSCALE HOUSING DEVELOPMENT ON RACIALLY EXCLUSIONARY
HAWAIIAN HOMELANDS OVERLOOKING DOWNTOWN HONOLULU,
WHERE WEALTHY PROFESSIONALS GET FREE LAND FOR HOMES
WORTH UP TO $385,000.
Here is information about the upscale housing development on Hawaiian
Homelands overlooking downtown Honolulu. The development is known as
The Department of Hawaiian Homelands has the slogan that it is "putting
Hawaiians back on the land." Thus, we are led to imagine poor, downtrodden
Hawaiians geting long-term $1-per-year leases for bucolic pastoral land
where they can live in a small but decent house while doing subsistence taro
farming or aquaculture. Instead, the perennially cash-short Department of
Hawaiian Homelands has built Kalawahine Streamside, overlooking downtown
Honolulu, where wealthy professionals get free land for homes worth up to
This excerpt is taken from The Honolulu Advertiser of Sunday, January 28,
The $26 million Kalawahine Streamside project was developed by
Kamehameha Investment Corp., a for-profit subsidiary of Kamehameha
Schools Trust, for the Department of Hawaiian Home Lands.
This unique upper-middle-class neighborhood on Hawaiian homestead land has
54 multilevel duplex units and 33 three-story single-family homes. Selections
were made off the Hawaiian Home Lands waiting list, but the asking price
of $174,900 to $196,100 for a duplex or $214,900 to $225,900 for a
single-family unit made it unaffordable for most.
"These are the most expensive homes ever offered to applicants, and the
reason is the topography," project manager Elton Wong said. "The conditions
were challenging from a design and construction standpoint. But for location,
it’s a good deal. Schuler Homes sells a market product of the same size for
around $385,000." . . .
"This is a throwback to the old Hawai‘i neighborhoods where you knew
everybody and nobody had to lock their doors," said stockbroker Mark Hee,
who moved into a Kapahu Street duplex unit uphill from Ha‘alelea Place about
a month ago. . . .
"It’s like living in a mini San Francisco because of the hills," said Hee’s wife,
Luana Alapa-Hee, a former Miss Hawai‘i. . . .
[It is unclear from the newspaper article whether stockbroker and Morgan-Stanley-Dean-Witter senior vice president Mark Hee, referred to above, is
related to Clayton Hee, Chairman of the Office of Hawaiian Affairs; or to
Al Hee, who is Clayton's brother and the Chairman of Sandwich Isles
Communications Inc. which has a sole-source $400 Million federal contract
to provide fiber-optic cable to the racially exclusionary 203,000 acres of
Hawaiian Homelands throughout the Hawaiian islands]
(c) Copyright 2002 Kenneth R. Conklin, Ph.D. All rights reserved.
For more, GO TO >>> Vultures of the Sandwich Isles
$ $ $
February 5, 2002
Ko Olina: tax break proposed
Two members of the Hawaii Senate have introduced a bill to provide a tax
break to a developer if he builds certain kinds of projects in West Oahu.
The 100 percent tax credit would apply to any development at Ko Olina that
qualifies as educational.
Developer Jeff Stone says he plans an aquarium there and also wants to
build sports facilities for the University of Hawaii.
Sen. Colleen Hanabusa (D-Barbers Point-Makaha) and Sen. Sam Slom (R-Waialae Iki-Hawaii Kai) cosponsored the bill.
Ko Olina is in Hanabusa's district. Slom usually opposes special interest
legislation but says in this case he thinks the result could be economic
Copyright 2002 American City Business Journals Inc.
September 19, 2000
News Release: 00-102
GOVERNOR NAMES NEW CHIEF PROCUREMENT OFFICER
Governor Ben Cayetano today announced the appointment of Charles
Katsuyoshi as Chief Procurement Officer (CPO) for the State of Hawaii.
"Charles Katsuyoshi has the expertise and the desire needed to continue our
efforts to streamline and improve the procurement process in this state,"
Governor Cayetano said.
Katsuyoshi had served as head of the Purchasing Division of the City and
County of Honolulu's Department of Budget and Fiscal Services since 1994.
Prior to that he was a contracts specialist with the City's Finance
The Senate must confirm the appointment for a term that would expire on
June 30, 2002. Katsuyoshi replaces Lloyd Unebasami, who resigned May 31,
2000, to become the Chief Administrative Officer of the Hawaii Tourism
* * *
August 28, 2001
State, Lockheed close to traffic camera deal
By Scott Ishikawa, Advertiser Transportation Writer
The state is moving ahead with plans to install traffic cameras to catch
drivers who run red lights and speed, despite a protest filed by a competing
State Department of Transportation officials plan to finalize the contract
with company Lockheed Martin IMS within the next two weeks and want the
traffic cameras in place as early as November, according to department
spokeswoman Marilyn Kali....
The competing bidder, Redflex Traffic Systems Inc., filed a protest in
July, claiming the state reversed its December 2000 decision to award the
contract to Redflex without providing an explanation....
Lockheed had filed its own protest over the state's initial selection of
Redflex. The state did the process over and Lockheed won the second time,
prompting Redflex to file the latest protest.
Charles Katsuyoshi, administrator of the state procurement office, gave the
Department of Transportation permission earlier this month to move ahead
with the Lockheed contract despite the Redflex protest.
Asked about the state's decision to go with Lockheed after previously
selecting Redflex, Kali said: "The department felt Lockheed's proposal was
most favorable to the state." . . .
Redflex's attorney, Lawrence Reifurth, said he is concerned the state is
moving ahead in spite of the protest, which is being reviewed by the attorney
"The state right now is pushing this camera project through by claiming that
time is the essence," Reifurth said. "But it took the state nearly three years
to put this project out to bid and the delay caused by Lockheed's protest
was several months."
Lockheed's traffic cameras have been under the microscope in the San
Diego courts system this summer. A San Diego judge earlier this month
upheld the use of Lockheed cameras used to catch red-light runners, but
ruled that the evidence collected by the devices is unreliable and should not
be admitted as evidence against motorists....
The judge scheduled an Aug. 31 hearing on whether the evidence against 398
motorists should be dismissed. . . .
For more on the GREED at LOCKHEED, GO TO > > > Tarnished Wings
CONTINUED IN PART II
For more, GO TO > > >
AIG: The Un-American Group
Alexander & Baldwin
A Connecticut Yankee in King Kamehameha’s Court
The Blackstone Group
Buzzards of Paradise
The Chubb Group
Claims By Harmon
Dirty Money, Dirty Politics & Bishop Estate
Flying High In Hawaii
The Grand (and dirty) Ko Olina
The Harmon Arbitration
I Sing The Hawaiian Electric
Kajima: Blood, Bribes & Brutality
Marsh & McLennan: The Marsh Birds
The Puna Connection
Pointing the Finger at WorldPoint
RICO in Paradise
The Harmon Arbitration
The Eagle Hooded
The Indonesian Connection
The Morgan, Lewis & Bockius Report
The Sinking of the Ehime Maru
Vampires on Gilligan’s Island
Vultures of the Sandwich Isles
Woo vs Harmon
Yakuza Doodle Dandies
~ o ~
MORE OF THE CATBIRD’S FAVORITE LINKS
THE CATBIRD SEAT FORUM
THE CATBIRD SEAT
~ o ~
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Last update October 7, 2007, by The Catbird