Former Polynesian
Cultural Center head
pleads guilty to fraud

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Associated Press

Pago Pago, American Samoa >> A third defendant indicted in Seattle in connection with an alleged Ponzi scheme that authorities say defrauded victims of $76 million has pleaded guilty.

Assistant U.S. Attorney Carl Blackstone said via telephone from Seattle that William H. Cravens, a former head of the Polynesian Cultural Center in Hawaii, pleaded guilty June 3 to one count of mail fraud and one count of conspiring to commit mail and wire fraud.

In return for his guilty pleas, other charges against Cravens were dropped, Blackstone said.

Cravens has also agreed to testify against the two remaining defendants in the case, John Zidar and Steven Moreland, who were scheduled to stand trial June 24, Blackstone said.

Two other alleged accomplices, John Mathews and Elizabeth Phillips, have also pleaded guilty. Cravens, Mathews and Phillips are to be sentenced in August.

The five were indicted in Seattle last year for mail fraud, wire fraud, money laundering and conspiracy in connection with an investment scheme that bilked money from 2,500 victims in the United States and Canada, prosecutors said.

Cravens established a corporation in American Samoa called the Private International Development Banc (PIDB) of American Samoa. It was issued a business license but was never chartered as a bank nor authorized to act as a bank, the indictment said.

The company then opened a bank account at ANZ Bank in neighboring Samoa.

"Once the bank account was opened, investors were falsely led to believe that PIDB was a real bank, instead of a shell corporation with a bank account, and were induced to send their funds to the PIDB account at ANZ Bank," the indictment said.

American Samoa revoked PIDB's certificate of incorporation in November 2000 because it was not authorized to act as a bank.

Cravens headed the Polynesian Cultural Center from 1975 to 1983 but has not lived in Hawaii since the early 1990s. He lived in La Jolla, Calif., when he was arrested in March 2001.

The California-born Cravens, who is half-Samoan, was once chairman of the Development Bank of American Samoa.