Almost 6 years ....

Now we just wait for the actual sentencing, the trial is over... those that know what I am talking about, thank you for your prayers, and please keep them coming we are not out of the woods yet. The stress is still being piled on. We can still lose the federal, state and city contracts. Federal and state I am not worried about at all. City I am greatly. R&L are in China right now, this might be their last trip together so please pray that it is a memorable one for them, filled with good memories. Sentecing is to be in January if I read everything correctly.

http://starbulletin.com/2006/10/28/news/story06.html

4 men found guilty in airport fraud

Two airport officials and two contractors defrauded the state of millions of dollars
By Debra Barayuga

dbarayuga@starbulletin.com
A federal jury convicted two former airport officials and two contractors of conspiracy and mail fraud yesterday in a bid-rigging scheme at Honolulu Airport.

The jury deliberated for just more than six hours to unanimously find Dennis Hirokawa, 64, former superintendent of airport maintenance; Richard Okada, 65, former director of the Visitor Information Program; and contractors Michael Furukawa, 60, and Wes Uemura, 61, guilty of conspiracy.

In addition, Hirokawa was found guilty of 17 counts of mail fraud; Furukawa, 19 counts; and Uemura, 15 counts.

All four defendants were stoic as the court clerk read the guilty verdicts. Relatives in the audience dabbed at their eyes and wept in the courtroom.

Each of the defendants faces five years' imprisonment on the conspiracy count and five years on each of the mail fraud counts when sentenced Jan. 15. U.S. District Judge David Ezra agreed to allow the men to remain free on bail.

U.S. attorney Larry Tong and state Deputy Attorney General Larry Goya prosecuted the case. The four men were "engaged in an elaborate scheme to abuse the public contracting process and caused economic damage to taxpayers," Tong said.

The environment of "pay to play" that the defendants subscribed to "caused a loss of faith in the integrity of state government that can't be measured in dollars and cents," he said.

Dana Ishibashi, attorney for Okada, said only that they were disappointed and will be exploring their options, including whether to appeal.

Defense attorney Howard Luke declined comment.

The verdict brings to an end a joint federal-state investigation that began more than six years ago by the state Attorney General after airport auditors learned the state was billed $14,000 for constructing four 6-foot-long plywood planter boxes to hold poinsettias during the holidays.

Prosecutors alleged that the four conspired from 1997 to 2002 to obtain $4.8 million in small-purchase contracts under $25,000, a less formal process that requires that three bids be submitted and the work awarded to the lowest bid.

The contracts were mostly awarded to six companies owned by Furukawa and Uemura, prosecutors said. A government expert who reviewed 171 of the jobs that paid contractors $1.4 million valued the work as worth only $380,000.

Tong said he is expects to ask the court to order the defendants to repay $2.5 million.

A civil proceeding is also under way in state court seeking to forfeit property owned by the defendants.

Charles Goodwin, special agent in charge of the FBI here, said he hopes the convictions serve as a deterrent. "And as time goes by and we pursue more and more corruption, more and more people will step forward because they see the government serious about taking it on at the state and federal level," he said.

http://www.honoluluadvertiser.com/apps/pbcs.dll/article?AID=/20061028/NEWS20/610280336/1001

Posted on: Saturday, October 28, 2006
Two airport officials convicted


By Ken Kobayashi
Advertiser Courts Writer



Two former state airport officials and two private contractors were convicted yesterday of participating in a scam involving phony bids, kickbacks and inflated contracts for repair jobs at Honolulu International Airport.

Dennis Hirokawa, former airport maintenance superintendent; Richard Okada, former administrator of the airport visitor information program; and private contractors Michael Furukawa and Wesley Uemura showed no emotion as the guilty verdicts were announced in the federal courtroom.

Assistant U.S. Attorney Larry Tong estimated that the two contractors received about $4.8 million for hundreds of jobs that defrauded taxpayers of about $2.5 million from 1997 to mid-2002. In exchange, Hirokawa and Okada received at least $129,000 in kickbacks, Tong said.

The four defendants "caused significant economic damage to the state taxpayers and more importantly, it caused a loss of faith in the integrity of state government," Tong said. "We're very pleased that the jury's verdict will bring some justice to the situation."

Lawrence Goya, senior deputy attorney general who also handled the prosecution, said the verdict sends the message that "public corruption within state government will not be tolerated and will be dealt with sternly when found."

All four defendants were convicted on a conspiracy charge of participating in the fraudulent scheme. In addition, three of them also were convicted on related mail-fraud counts — 18 for Furukawa, 16 for Hirokawa and 14 for Uemura. The conspiracy and mail-fraud convictions each carry up to five years in prison.

Tong said the federal sentencing guidelines will likely recommend prison terms, and he will also recommend that the four spend time behind bars.

U. S. District Judge David Ezra scheduled sentencing for Jan. 15. He permitted each of the men to remain free on bond pending the hearing.

The four men all declined to comment.

"We're disappointed with the verdict," said Dana Ishibashi, Okada's lawyer. "We will be exploring our options in regards to an appeal."

The trial provided a rare insider's view of what prosecutors called a "pay for play" scam created by crooked state officials who received kickbacks that they claimed would be used for the benefit of unnamed politicians.

It involved contractors submitting inflated bids that were awarded to them because they also turned in fake bids on behalf of other contractors asking for higher amounts, prosecutors said.

In exchange, the contractors would give the state officials — Hirokawa and Okada — cash and other benefits, according to the prosecutors.

During the trial, Tong said that in one contract, the state paid $9,670 to repair cracks in a floor that cost only $250 to fix.

The government's case relied on a former state airport official and five other contractors who pleaded guilty to theft in state courts and agreed to testify for the federal prosecution.

Arthur K. Inada, one of the five, told the jury he gave $129,000 in payments ranging from $20 pastry purchases at Dee Lite Bakery to two $20,000 cash payments that Okada claimed were needed for "campaign donations."

No politician's name surfaced during the trial.

Okada and Hirokawa took the witness stand and denied any criminal wrongdoing, while the defense lawyers argued to the jury that the government relied on self-serving witnesses who couldn't be believed and unreliable analysis of the value of the work on the repairs.

They maintained that the prosecution failed to prove its case beyond a reasonable doubt.

The jury, however, after four weeks of trial, needed only about seven hours Thursday and yesterday to find the defendants guilty on all charges.

Tong said the estimate of more than $2.5 million in losses to the taxpayers was based on an analysis by a prosecution expert who reviewed 171 of the hundreds of jobs awarded to the two defendant contractors. The contracts were all for less than $25,000 and most of them were in the $10,000 range, Tong said.

The expert concluded that the contractors were paid $1.4 million for work that actually cost about $380,000.

The prosecutor said the airport now has new management and personnel. "Hopefully, that will address the problem," Tong said.

He also said he hopes the convictions "will deter any public employee from considering any similar conduct."

Reach Ken Kobayashi at kkobayashi@honoluluadvertiser.com