Royal Hawaiian
head insists trustee
dealings proper

The Bishop Estate subsidiary says
the charges regarding credit cards
and other benefits are political

By Rick Daysog
Star-Bulletin

The head of Bishop Estate's Royal Hawaiian Shopping Center Inc. subsidiary has denied allegations that the for-profit company improperly paid current and former trustees, saying the charges appear politically motivated.

Richard Wong, Royal Hawaiian's president, said yesterday the company did not issue credit cards to employees or Bishop Estate trustees for their personal use nor did it provide other improper benefits such as loan payments or jobs for relatives.

"I can assure you that nothing of this manner has happened here. We have worked hard to do a good job here, and this is an outrage and an insult to our company," said Wong, who is not related to Bishop Estate trustee Richard "Dickie" Wong.

"Frankly, the innuendo being created by the attorney general here may be part of the campaign for the governorship of the state."

In her investigation of the Bishop Estate and its trustees, Attorney General Margery Bronster is looking into whether current or former trustees, their families or friends received improper benefits from Royal Hawaiian or its parent, Pauahi Holdings.

Employee files requested

State attorneys issued a subpoena last month to Royal Hawaiian seeking employment contracts and billing records relating to trustees Wong, Oswald Stender, Henry Peters, Lokelani Lindsey and Gerard Jervis. The state investigators also are seeking contracts with former trustees Matsuo Takabuki, William Richardson and Myron Thompson.

The filing also named nine additional Royal Hawaiian employees and asked for employment files, loan payments and credit card records, as well as other disbursement and billing records. At least three of the employees are relatives of Bishop Estate trustees or key estate staffers.

Wong said yesterday that Royal Hawaiian recently filed court papers opposing the attorney general's subpoena, saying it was overly broad and asked for personal and financial information about Royal Hawaiian workers who are not parties of the state's investigation.

Wong added that the state's subpoena would require the company to turn over more than 4,000 billing statements, checks, invoices and other financial documents. A hearing is set for Sept. 24.

IRS records subpoenaed

"We would be happy if the scope of these things were limited, if it made sense and if it addresses the problem at hand," Wong said.

The legal skirmish comes as state attorneys have recently subpoenaed Bank of Hawaii for billing statements and information about credit cards issued to Royal Hawaiian.

The attorney general's office also has subpoenaed records known as information document requests that Royal Hawaiian has submitted to the Internal Revenue Service as part of its audit of the estate.

Deputy Attorney General Hugh Jones said the state has good cause for seeking the records from Royal Hawaiian.

He noted that reliable sources have alleged that some employees were paid for jobs in which they conducted no real service.

Peters' credit card suspect

Royal Hawaiian also has issued a credit card to Bishop Estate trustee and Royal Hawaiian Chairman Henry Peters, and sources have told the state attorneys that the card was used largely for personal expenses. "It's not like we sat around the table and said, 'Let's go fishing,'" Jones said. "We're doing this for a reason."

Wong defended Peter's credit card, saying Peters uses it for business trips and not for personal expenses. Since he became a trustee, Peters has charged less than $1,000 on the Royal Hawaiian credit card, Wong said.

Wong also defended the company's hiring, saying relatives or friends of trustees do not get preferential treatment. "Here in Hawaii, everybody's a second cousin to somebody else, and there's a damned good chance that you're going to have people who are related," Wong said.

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