Inquiry targets
Dem donors

A federal grand jury issues
subpoenas to an engineering
firm linked to donations

By Rick Daysog

A federal grand jury is investigating political contributions by local contractors to the campaigns of Honolulu Mayor Jeremy Harris and other isle Democrats.

The secret panel recently issued subpoenas to the local engineering firm SSFM International Inc., which is linked to nearly $200,000 in political donations to Harris, Gov. Ben Cayetano, Lt. Gov. Mazie Hirono and Maui Mayor James "Kimo" Apana, according to people familiar with the inquiry.

The subpoenas are believed to be the first by the grand jury, which appears to be targeting companies that the state Campaign Spending Commission says funneled campaign contributions through their employees.

The federal inquiry coincides with a parallel criminal investigation by city Prosecutor Peter Carlisle into the Harris 2000 re-election campaign and its officials.

Steven Hisaka, an attorney for SSFM, could not be reached for comment.

The Office of the U.S. Attorney had no response. A lawyer for the Harris campaign also had no comment, saying the federal investigation does not target their campaign.

Harris, the former front-runner for this year's Democratic gubernatorial race, dropped out of the election last month, citing weak poll results.

The FBI and the U.S. Attorney's office have contacted several local engineering and architecture firms as part of the same federal inquiry, while the Internal Revenue Services' criminal division is looking at whether any of the donors violated federal tax laws.

Phillip Li, an attorney representing several local engineering firms, said that federal authorities have interviewed some of his clients, who are cooperating with investigators.

But Li, a former commissioner with the state Campaign Spending Commission, declined to identify the companies or give further details.

SSFM is one of the state's largest engineering firms with millions of dollars in state and city contracts.

The Star-Bulletin previously reported that relatives of SSFM's officers made about five dozen contributions worth nearly $200,000 to some of the isles' top-ranking Democrats.

More than $92,000 went to Harris' 2000 mayoral campaign, while Cayetano's 1998 re-election campaign received about $71,000. Apana's campaign raised about $30,000 from people linked to SSFM. The Hirono campaign received $4,050 in 1998.

The state Campaign Spending Commission has alleged that SSFM operated a special banking account in which the firm's officers were able to transfer company money to friends and relatives for political contributions.

The federal grand jury investigation comes as SSFM is contesting several administrative subpoenas issued by the commission for banking and other financial information held by the firm and its officers.

SSFM has argued that the commission does not have jurisdiction since it referred its probe of the Harris campaign to the city prosecutor's office for a criminal investigation.

However, the commission has argued that it is entitled to the records since it did not refer its investigation into SSFM to the prosecutor's office.

Campaign Spending Commission

E-mail to City Desk


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