2 airport officials Investigators from the state Attorney General's Office arrested two Honolulu Airport supervisors yesterday in what may be one of the largest scams involving public funds in state history, according to a source close to the investigation.
arrested in scam
They allegedly inflated project
costs and received kickbacksBy Rod Antone
rantone@starbulletin.comThe suspects allegedly inflated the cost of hundreds of maintenance projects to obtain kickbacks from vendors, according to the source.
The scheme more than doubled the annual expenses of the airport maintenance department to $7 million from $3 million, the source said.
"If those folks are guilty, it is our attorney general that will be prosecuting them," Gov. Ben Cayetano said to reporters yesterday.
"We did that at the airport, with the police and the abuse of overtime, and in this case.
"This administration, when we close out in six months, will be known as an administration that when we saw problems that involved wrongdoing or criminal activity, we went out after them and tried to correct them," Cayetano said.
Maintenance superintendent Dennis Hirokawa and airfield and grounds maintenance supervisor Antonio Bio were arrested at Honolulu Airport between 8:30 and 9 a.m. yesterday, booked at District Court downtown, then released pending further investigation.
Hirokawa was arrested for first-degree theft and bribery while Bio was arrested for second-degree theft, according to a news release from the AG's office.
Other suspects in the case may include at least a dozen general contractors, some of which were hired to do the work at inflated prices and agreed to provide kickbacks, the source said. State investigators are also checking hundreds of airport maintenance projects to see if work was actually done, according to the source.
The case began as an internal investigation by airport officials six to eight months ago and was turned over to attorney general investigators in April. The investigation focuses on a two-year period, from 1999 to 2001, during which the alleged scheme revolved around small purchase contracts for projects under $25,000, according to the source.
Most of the work involved minor repairs such as cracks in floors, holes in walls and replacing ceramic tile, the source said. And although the suspects were required to get three separate quotes, usually only one contractor was called, the source said.
The suspects then inflated the costs of the projects and arranged to have kickbacks paid to them by the contractor, the source said.
Asked if other airport workers could be subject to arrest in the case, chief investigator Donald Wong said that his office is not ruling anyone out as a suspect.
The Department of the Attorney General also asks that any individuals or companies with information related to the maintenance contracts at the Honolulu Airport contact the Investigations Division at 586-1240.