Tuesday, June 18, 2002

Hawaii businesswoman
admits cheating Unity House

She pleads guilty in schemes
to defraud the labor organization

By Debra Barayuga

A Hawaii businesswoman and former consultant to Unity House has pleaded guilty to four counts in two separate schemes to defraud the nonprofit labor organization.

Roberta Cabral, 44, entered her pleas yesterday before visiting U.S. Senior District Judge Manuel Real for failing to pay taxes and using offshore accounts to hide her income from the state and federal government, said special attorney Edward E. Groves of the Justice Department's Tax Division.

Cabral pleaded to two counts of federal income tax evasion for tax years 1992 and 1993, one count of willfully failing to file an income tax return for tax year 1994 and one count of wire fraud.

Cabral was indicted in August 2000 along with former Unity House Executive Director "Roddy" Rodriguez, who later died of an apparent suicide the day he was to be arraigned.

The charges Cabral pleaded to yesterday are contained in a superseding indictment handed down in April 2001.

Cabral admitted to participating with codefendant Rodriguez in a scheme to defraud Unity House between March and April 1994 by inflating the budget for "Heavenly Road" -- a one-hour TV project that the labor organization was funding -- to hide from the board of directors that Cabral would receive a $150,000 kickback.

The project later was to be the basis for a proposed TV series called "Blue Hawaii."

The wire fraud charge stemmed from Cabral sending a fax approving payment from Unity House to the head of the production company that was putting the project together.

In 1994, Cabral filed tax returns reporting more than $118,000 in taxes she owed for calendar years 1992 and 1993, but failed to make payments, according to the agreement.

Instead, in July 1997 she created Honua Group LLC and opened a bank account in November 1997 using her brother's Social Security number to willfully hide her income and avoid paying taxes.

Cabral also failed to file federal or state income tax returns for tax year 1994 when she received more than $50,000 in commissions for participating in a 1992-93 offshore investment scam to defraud Unity House, according to the agreement.

She admitted that the money she received from North Pacific Investments Inc. was wire transferred through a British Virgin Islands corporation controlled and used by her to hide her income.

Cabral testified in Seattle as a key witness in the Northwest Pacific Investment trial, where Jack Gonzales, former executive director of the Campaign Spending Commission, was convicted of fraud, money laundering and conspiracy for defrauding Unity House. Also convicted were former attorney Rodney H.S. Kim, contractor Stafford Mew and Seattle businessman Morreon Rude.

Gonzales and the three others each were sentenced in 1995 to 15 years in federal prison.

Cabral will be sentenced Nov. 1. She faces five years and potential fines of $250,000 on the income tax evasion and wire fraud charges. Willful failure to file is punishable by one year in prison and a fine of $100,000.

Cliff Hunt, attorney for Cabral, declined comment.

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