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Friday, June 25, 1999




Wong asks feds
to halt grand jury

Wong, his wife and brother-
in-law had been subpoenaed by
the attorney general's office
to testify again

Filed 2:15 p.m. HST, Friday, June 25, 1999

By Rick Daysog
Star-Bulletin

Tapa

Lawyers for Bishop Estate trustee Richard "Dickie" Wong and his wife Mari will go to federal court in an attempt to halt grand jury proceedings scheduled for Tuesday.

The attorney general's office on Wednesday subpoenaed the Wongs and Mari's brother, local developer Jeffrey Stone, to testify before an Oahu grand jury about an alleged kickback scheme involving Bishop Estate land.

The attorney general's office also subpoenaed estate attorney Nathan Aipa and trust land manager Paul Cathcart.

Jerry Fonseca, Mari Wong's attorney, said he and Eric Seitz, trustee Wong's attorney, plan to file a suit in federal court either today or Monday challenging the grand jury investigation.

The suit will allege that the attorney general's office is misusing its powers in pursuing a criminal investigation which has no merit, and will question the constitutionality of some of the subpoenas that had been issued, Fonseca said.

He noted that Circuit Judge Michael Town earlier this month threw out indictments against the Wongs and Stone, saying the grand jury's decision was tainted by the testimony of Stone's former attorney, Richard Frunzi, who had been convicted on unrelated federal money laundering charges.

Tuesday's session will be before a different grand jury.

"I think we have enough factual proof that they are misusing their powers in this case," Fonseca said.

The attorney general's office subpoenaed the Wongs and the other witnesses to appear a grand jury to testify about a Hawaii Kai land deal in which Stone and his mainland partners, National Housing Corp., acquired the estate's fee interest to the 219-unit Kalele Kai condominium project.

The attorney general's office has alleged the estate gave Stone and his mainland partners preferential treatment when they acquired the fee interest in 1995 for $21.9 million.

In return, Stone acquired the Wongs' Makiki condominium several months later for $115,000 more than it was worth, the state has said.

Wong, who was temporarily removed as a trustee by Probate Judge Kevin Chang last month, has denied wrongdoing, saying he recused himself from negotiations involving Kalele Kai. Stone has denied that he received favorable treatment from the estate, saying the deal benefited the estate tremendously.

Stone's attorney, John Edmunds, has threatened to file a law suit against the attorney general's office for wrongful prosecution. Edmunds could not be reached for comment.

Wong previously filed a federal court challenge to the grand jury's investigation, but that suit was dismissed by U.S. District Judge Alan Kay in January.



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