8 indicted in probe City officials want Honolulu police to take over liquor investigations after a federal grand jury indicted six liquor investigators and two former supervisors on charges of extortion and racketeering.
of city liquor panel
6 are liquor investigators, so
the mayor wants police to
assume those dutiesBy Nelson Daranciang
ndaranciang@starbulletin.comCity Councilman John Henry Felix made that suggestion, as has Mayor Jeremy Harris, who said it is under study. But Harris said the transfer of investigation duties would trigger a large number of organizational, staffing and charter issues.
In a news conference yesterday, U.S. Attorney Edward Kubo said the Liquor Commission staff "is so corrupt that it should be scrapped."
The liquor investigators and former supervisors each face 57 charges of public corruption for allegedly accepting and extorting bribes from proprietors of liquor establishments they were supposed to monitor. The indictment was handed down Wednesday but kept under seal until yesterday.
The defendants represent two-thirds of the night-shift investigators.
Five of the defendants pleaded not guilty to the charges yesterday. Their trial is set for July 23. Retired night-shift supervisors David K.H. Lee and Harvey T. Hiranaka, 55, and investigators Collin M. Oshiro, 32, and William B. Richardson Jr. were released on a $20,000 signature bond.
Investigator Arthur M. Andres, 59, remains in custody after testing positive for methamphetamine use, federal prosecutors said.
Assistant U.S. Attorney Michael Seabright asked U.S. Magistrate Barry Kurren for the drug test during yesterday's arraignment because he said undercover tape-recorded conversations suggested that Andres is a drug user, was under the influence of methamphetamine during work hours, owns several firearms and displayed a certain level of paranoia.
There are 80 days of tape recordings of about eight hours each, Seabright said.
Two other defendants, inspectors Samuel K.Y. Ho, 43, and Kenneth L. Wright, 47, were not in custody yesterday. And investigator Eduardo C. Mina, 71, is in the Philippines.
Each of the defendants is charged with one count of running a criminal enterprise through racketeering, conspiracy to violate laws prohibiting such activity and multiple counts of extortion by a public servant.
Each of the charges carries a maximum 20-year prison term and $250,000 fine.
"It is alleged that these investigators targeted 45 liquor establishments or hostess bars on Oahu. In their lone capacity as liquor investigators, they obtained money from these bars in exchange for not enforcing liquor laws," Kubo said.
According to the indictment, the payments ranged from $40 to $1,080 per visit.
The crimes alleged in the indictment were recorded between October 2000 and September 2001 by a Liquor Commission enforcement investigator who agreed to go under cover in the joint investigation by the Honolulu Police Department and the FBI.
"One of the investigators came forward with some information for us and was involved in assisting with the investigation," said Dan Dzwilewski, FBI special agent-in-charge, Hawaii.
"These kind of cases, these public corruption, are only possible when you have people like this come forward."
No one from any of the liquor establishments named in the indictment is charged with any crime.
If people were being extorted, the money they paid is not a bribe, said Kubo.
However, he said the investigation is continuing, and he is not discounting the possibility of charges against more defendants, including additional Liquor Commission employees.
Kubo also called for scrapping the current system of enforcing liquor laws in Honolulu.
"I definitely believe that the system they have in place now, the enforcement, is useless," said Kubo.
"This case represents how out of control a system can get when left unnoticed, unmonitored with no checks and balances. Clearly in this case, the foxes were left to guard the henhouse."
Felix, chairman of the Public Safety Committee responsible for overseeing the Liquor Commission, calls the situation regrettable, but one with far deeper issues.
"We're dealing with inspectors who are underpaid, underqualified and undertrained. When you pay clerical wages, you get what you pay for," Felix said.
Harris also said there is the additional cost to the Police Department if it takes over liquor investigations.
Capt. Kevin Lima, HPD Narcotics/Vice Division said: "Right now, HPD is tasked with many different things. Added to our responsibilities right now is homeland security.
"So it's very much taxing our resources. And we're very limited in terms of resources. At this time it would be very difficult for us to add on additional responsibilities."
City & County of Honolulu
