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Witness tells
of giving cash
to Kahapea

He says he accepted city
money and gave part
to the defendant

By Gordon Y.K. Pang
Star-Bulletin

A Honolulu businessman testified today that he accepted $2 million in city checks from former housing official Michael Kahapea for work not done, issued cashier checks on his instructions, and then split the remaining $300,000 to $400,000 in cash between himself and Kahapea.

Kahapea is accused of masterminding a scheme that bilked the city of $5.6 million from the Ewa Villages relocation fund by making false or inflated claims for payment.

Claude Hebaru testified that he first met and became acquainted with Kahapea at the Crystal Palace hostess club in the late 1980s. The owner and president of Pest Management Hawaii said that as his friendship with Kahapea grew, the housing official approached him about being able to make money by subcontracting relocation work.

But under questioning by Deputy Prosecutor Randal Lee, Hebaru testified that he never did any work for the money he received. On Kahapea's instruction, Hebaru said he took $2 million in city checks and then issued cashier checks for some $1.6 million to people and companies he did not know.

Faces sentence in December

He said he felt getting involved with Kahapea was a good idea "so I could make some contacts with the city."

Hebaru pleaded guilty to theft, money-laundering and filing false tax returns, and will be sentenced in December. He agreed to testify in exchange for leniency.

In testimony yesterday, Michael Shiroma, the man credited with exposing the Ewa Villages scandal, said he was afraid to come forward with information because of a threat by one of the principals in the alleged scheme.

Norman Tam, a second city housing official fired and implicated in the case, died last year.

Shiroma, under cross-examination by deputy public defender Todd Eddins, said he was reluctant initially to approach authorities about his suspicions involving Ewa Villages.

"I was fearful of reporting anything which would implicate Norman Tam and whoever his associates within the city, and externally from the city, might be," Shiroma testified.

Tells reporters of implied threat

While he was vague on the stand about the alleged threat, outside the courtroom Shiroma pulled a bullet out of his pocket and showed it to reporters.

He later told the Star-Bulletin that he and Tam were "jousting" about Ewa Villages in 1996 when the bullet changed hands as part of what Shiroma believes was a threat.

"I ask him, 'If you don't like a guy, what do you do?' " Shiroma recalled. "So he reaches into his pocket and says, 'I give him a bullet, just like I'm giving one to you today, Mike.' "

Shiroma noted that he had already been quietly asking questions for more than a year about possible improprieties involving "irregularities" with the Ewa Villages revitalization project.

In the courtroom, Shiroma said he did not go to Michael Hansen, the city Finance Department's chief auditor of internal control, until 1997, a year after the conversation with Tam.