Campaign finance The former Maui beauty queen who was subpoenaed by a grand jury investigating Honolulu Mayor Jeremy Harris' political campaign was arrested last month in Waikiki on suspicion of promoting prostitution.
figure faces
prostitution charge
Otsuka previously was subpoenaed
in the Harris inquiryBy Rick Daysog and Nelson Daranciang
rdaysog@starbulletin.com ndaranciang@starbulletin.com
Honolulu police officers arrested Lisa Katherine Otsuka on Aug. 15 at the Aston Waikiki Grand hotel for allegedly promoting prostitution in the second degree, money laundering, illegal ownership of a business and making a false statement, according to police records.
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Otsuka, 32, was not charged but was held at the main police station for more than five hours.
She was released pending further investigation.
A person familiar with the investigation said one of the police officers who arrested Otsuka served her with a subpoena to testify before an Oahu grand jury on Sept. 5. Otsuka later declined to appear before the secret panel and was arrested on Sept. 9 for contempt of court.
The officer who directed the first arrest is part of the team that is investigating the Harris campaign.
Promoting prostitution -- or operating as a "madam" of a house of prostitution -- is a felony punishable by up to five years in jail and a $10,000 fine.
Michael J. Green, Otsuka's attorney, could not be reached for immediate comment yesterday.
Previously, Green has complained about the Honolulu Police Department's handling of his client, calling it overkill.
Harris, who had been the Democratic front-runner for this year's governor's race before he dropped out of the race in May 30, has said he does not know Otsuka.
William McCorriston, Harris' attorney, could not be reached for comment yesterday but previously has said that Otsuka has no connection to the mayor's campaign.
The prosecutor's office, which is leading the grand jury investigation, had no comment.
The grand jury is investigating Otsuka for her alleged receipt of more than $75,000 that originated from the Harris campaign.
During the 2000 election season, the Harris campaign paid the money to a company known as Campaign Service Inc., but much of the money wound up with Otsuka, according to people familiar with the inquiry.
Campaign Service is a trade name that is registered to the political research and public relations firm of Mattson & Co. State business records list Harry Mattson and Norma Wong, two longtime supporters of Gov. John Waihee's, as Mattson & Co.'s partners.
The prosecutor's office recently subpoenaed Mattson & Co.'s bank records as well as Otsuka's.
They also questioned Mattson and Wong under oath about the payments.
Mattson declined comment, and Wong has said she does not know Otsuka.
Otsuka worked for Mattson during the 2002 state Democratic Party Convention at the Sheraton-Waikiki Hotel where she provided catering services for a hospitality room. A nonprofit corporation headed by Otsuka, Aloha Honor Scholars Foundation, also listed the same Nuuanu Avenue address as Mattson & Co.
Bob Watada, executive director of the state Campaign Spending Commission, said Otsuka's arrest on suspicion of promoting prostitution raises serious questions about her alleged receipt of money that originated from the Harris campaign.
"Why would campaign money go to someone who is arrested for promoting prostitution?" asked Watada, whose office has made inquiries about the Harris campaign's payments to Campaign Service.
News of Otsuka's first arrest comes after an Oahu grand jury indicted Otsuka on Tuesday on a second-degree theft charge for alleging taking money from a fund-raiser for at-risk Wahiawa youths.
The prosecutor's office said the indictment is separate from its investigation into the Harris campaign.
A 1987 graduate of Baldwin High School, Otsuka is a former Miss Maui but was stripped of the title after pageant organizers raised questions about her school transcripts.
