Saturday, December 4, 1999

For Wong,
‘it took courage
to resign’

Longtime friends believe history
will be kinder to the former Bishop
trustee than recent headlines

By Rick Daysog


The wear and tear of the past 30 months are clearly visible.

His marriage ended in divorce; he has lost considerable weight due to stress; and his reputation as a tireless lawmaker and champion of the little guy has taken some knocks.

Yesterday, Richard "Dickie" Wong resigned permanently as a trustee and chairman of the Bishop Estate, avoiding a Dec. 13 trial over a suit to permanently bar him from the charitable trust's koa boardroom.

After battling efforts to remove him from the trust for more than a year, the 67-year-old former state Senate president now wants to move on with his life, according to his attorney, Glenn Sato.

Wong, who was temporarily ousted from his $1 million-a-year post by Probate Judge Kevin Chang in May, said that he hopes the will of trust founder Princess Bernice Pauahi Bishop is protected, that the estate prospers and that the trust-run Kamehameha Schools continues to educate children of Hawaiian ancestry.

"It's too bad that he was put through a lot of turmoil," said Leroy Akamine, president of the 3,100-member Na Pua a Ke Ali'i Pauahi, a parent, alumni and community group that has criticized the management of the estate by Wong and his fellow trustees.

"It took courage to resign, but at the same time I'm sure Dickie finds it comforting that the heavy load on his shoulders has been lightened and that he can look ahead for the better things in life."

Retired Adm. Robert Kihune, chairman of the estate's court- appointed interim board of trustees, said Wong's resignation is in the best interest of the estate and the Kamehameha Schools since it will help preserve the trust's valuable tax-exempt status, which the Internal Revenue Service recently threatened to revoke.

Kihune and the interim board have sued for the permanent removal of Wong and fellow trustees Henry Peters and Lokelani Lindsey for jeopardizing the trust's nonprofit status by allegedly taking excessive pay, mismanaging trust investments and neglecting the estate's core educational mission.

The suit against Peters and Lindsey, who was permanently removed in May by Circuit Judge Eden Elizabeth Hifo for separate breaches of trust, will go to trial on Dec. 13.

Wong's resignation is unconditional, meaning that the state and the IRS likely will continue their various legal actions against him.

Deputy Attorney General Daniel Morris said the state has made no deal in exchange for Wong's resignation. The state is seeking tens of millions of dollars in damages and fines against Wong and his fellow trustees for allegedly mismanaging the trust and benefiting at its expense.

Earlier this year, an Oahu grand jury directed by the attorney general's office indicted Wong; his former wife, Mari; and her brother, local developer Jeffrey Stone, over an alleged kickback scheme involving Bishop Estate land in Hawaii Kai.

Circuit Judge Michael Town later overturned the criminal charges, saying state prosecutors illegally bolstered the grand jury testimony of Stone's former attorney, Richard Frunzi, who was convicted of federal money laundering charges.

Meanwhile, auditors with the IRS' civil team have been looking into whether Wong and his fellow trustees received excessive compensation, while IRS criminal investigators have subpoenaed banking and tax records of Wong, Peters and Lindsey.

Longtime friends said the 2-year Bishop Estate controversy has been a tremendous strain on Wong. They believe history will be much kinder to him than recent headlines.

"Dickie is a stand-up guy, and I've never seen him run from a battle," said Rick Wall, chief executive officer of resort operator Castle Group Inc., who has known Wong for more than 20 years. "(But) I think it's time for everybody to move on."

U.S. Rep. Neil Abercrombie, who has known Wong for more than 30 years, said it's unfair to judge Wong by the events surrounding the Bishop Estate controversy. Wong has always been the champion of the little guy, dating to the 1960s when he marched in the South with civil rights activists and to the days when he presided over the state Senate, Abercrombie said.

"I always believe that Dickie's motivations were on behalf of Hawaiians and the beneficiaries," Abercrombie said.

Critics, however, have a different view. Roy Benham, president of the Kamehameha Alumni Association's 1,200-member Oahu region, faulted Wong for running the Bishop Estate as if it was the Senate. Benham likened a so-called lead trustee management system -- in which each trustee was placed in charge of various subject matters -- to the committee-chairman system in the Legislature.

The problem is that it allowed Lindsey and Peters to mismanage the Kamehameha Schools and the estate's asset management division, Benham said.

"That's no way to run a trust," Benham said. "I think he lost sight of the fact that all trustees are equal."

Richard 'Dickie' Wong

Bullet Age: 67
Bullet Annual pay*: $1,037,012
Bullet Appointed trustee: 1992
Bullet Experience: Former state Senate president; former business agent, United Public Workers union
Bullet Education: Bachelor's degree in social work, University of Hawaii

* For year ending June 30, 1998

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