Corruption scandal spills over into city hall as top attorney gets federal target letter

HNN: … Hawaii News Now broke the news Monday afternoon that attorney Donna Leong — who was appointed Honolulu’s corporation counsel by Mayor Kirk Caldwell in 2013 — received a federal “target letter” as part of the probe.

Several hours later, Mayor Kirk Caldwell (finally) confirmed the report in a news conference, saying that Leong got the target letter on Jan. 3 and informed him shortly afterward.

(Translation: He hoped to cover this up and got away with it for 11 days.)

She was put on paid leave Monday.

Caldwell said Leong did not immediately take leave (and the public was not immediately informed) because he wanted to give her time to retain a lawyer (insert 11 days worth of excuses here).

Caldwell said Leong is apparently being investigated for her role in a $250,000 payout and separation agreement for Kealoha when he left HPD. “I don’t know any more than that,” Caldwell said (lying)…

Meanwhile, the mayor also confirmed that federal authorities raided the Frank Fasi Municipal Building earlier this month in connection with the case. It’s the second time authorities investigating the case have raided the building….. 

Leong was heavily criticized for her role in the (Jan 18, 2017) $250,000 payout to Kealoha after his departure from the Honolulu Police Department. Some called the payoff illegal because it was agreed to behind closed doors.

She also faced heat for the firing of Chuck Totto (June 15, 2016) from his position as the leader of the city’s Ethics Commission, which launched an investigation into the Louis Kealoha and his wife, Katherine, years before they were indicted….  (Coverup and hush money?) 

SA: Leong had been scheduled to appear Tuesday before the Hawaii Supreme Court to give oral arguments on a separate case defending the actions of the city Elections Division

AP: A search warrant was served on the city’s Department of Information Technology last week, Caldwell said. It was the second FBI raid on the department in recent years.

HNN Feb 3, 2017: “A payment of $250,000 without City Council approval may not be legal.”  

HNN: The $250,000 payout to Louis Kealoha in a 2017 settlement that forced him to resign as police chief came in three separate transactions

Police Commission Has no Authority to Disburse Funds

SA: … Sword, at the time, said the money was paid out of HPD’s salaries budget. HPD was projected to have a surplus of more than $1 million in its current expenses account when the fiscal year ended June 30, he said.

He provided the Honolulu Star-Advertiser a copy of the Jan. 26, 2017, check and check stub, which indicated the funds came from an HPD account.

Neither the Honolulu City Charter nor the Revised Ordinances of Honolulu contain specific language allowing the commission the authority to spend HPD money or to instruct HPD to spend money.

The payment was never approved by the Council, and it’s unclear whether it was needed.

Sword could not be reached for comment Monday….

read … City’s top civil attorney included in feds’ Kealoha inquiry

Star-Adv: Caldwell Took too Long to Announce Target Letter

SA: …Mayor Kirk Caldwell, in a press conference Monday, said the federal letter stemmed from Leong’s advisory role in striking that severance deal.

Caldwell added that he had planned the announcement in advance but decided to postpone it.

He did so to give Leong time “not only to retain an attorney but to give that attorney time to examine the facts of the case as she would be asked to speak on her client’s behalf,” said Andrew Pereira, the mayor’s communications director.

For those reasons, and so that the Cabinet could be alerted and Leong’s deputy, Paul Aoki, could take over operations, Leong was not put on administrative leave until Monday, Pereira added.

That seems a needlessly generous allotment of time, with Leong’s leave starting more than a week after she received the Jan. 3 letter. The mayor should have confirmed the letter’s receipt, and started Leong’s leave, much sooner.

Even with presumption of innocence, that’s the right course of action for Leong — and the city prosecutor should do the same. It’s unconscionable that Kaneshiro, an elected official, believes he can carry on his duties while he is plainly under a legal cloud — a particularly direct one, as Katherine Kealoha’s onetime supervisor.

At the press conference, Leong’s attorney, Lynn Panagakos, said in defending her client that “the payment was properly authorized and processed.” That leaves unanswered how the deal was approved without full disclosure of the specific source of the funds.

Cary Okimoto, who was acting chief at HPD at the time the deal was struck, wrote in a letter to department staff Jan. 19, 2017, that he was on the record as opposed to having the severance come from the department budget. The check, dated Jan. 26, listed HPD as the account-holding department….

read … Editorial: Tell public more about fed probe

SA: Honolulu police sergeant not testifying in Kealohas’ trial

read … Corruption scandal spills over into city hall as top attorney gets federal target letter

Police Commissioners: Leong Said Take it or Leave it

CB: … Sheehan, a former federal prosecutor, said she remembers it as a brief conversation and one that didn’t seem to be concerning at the time, given Sword’s calm demeanor.

“I remember wondering what was up,” Sheehan said. “I wanted to know why the FBI was looking at chief Kealoha’s severance package because we had certainly never been informed by our lawyer Donna Leong that there was anything to be concerned about.”

Sheehan was the only member of the commission to vote against Kealoha’s severance package. She said it was negotiated in private by Sword and Leong. When it was presented to the commission, she said Leong described the $250,000 payout as a “take it or leave it” proposition.

“When we began to question the wisdom of the deal that Donna Leong and Max Sword had cut we were told by Ms. Leong that we were not going to negotiate it,” Sheehan said. “This was a take it or leave it deal, she said, so I left it.”

Levinson told Civil Beat he had the same recollections as Sheehan, both about Sword and McCorriston meeting with federal investigators and the $250,000 deal for Kealoha.

“We had nothing to do whatsoever with the negotiation of that agreement,” Levinson said. “We did not know what the terms of it were until we were asked to sign off on it.” ….

read … Police Corruption Probe Snags City’s Top Lawyer