Agent admits giving $125,000
to union leader

The insurance agent says Rodrigues
never asked for the money

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By Debra Barayuga
dbarayuga@starbulletin.com

An insurance agent said he gave his friend Gary Rodrigues cash payments averaging $25,000 annually over a five-year period for the United Public Workers union's business.

But Herbert Nishida, a sales agent with Transamerica, which entered into a contract to provide life insurance policies to UPW members, testified yesterday that he did not believe he was doing anything illegal by doing so.

UPW state Director Rodrigues is on trial in U.S. District Court for allegedly receiving kickbacks and embezzling from the union by negotiating health and life insurance contracts with inflated premiums and funneling consulting fees to his daughter for the benefit of himself and other family members. His daughter, Robin Haunani Rodrigues Sabatini, is also accused of receiving consulting fees for work she allegedly did not perform.

Nishida, who took the stand yesterday with the understanding he would not be prosecuted for the information he provided, said he made the payments because he appreciated Rodrigues, the UPW's business and all the help Rodrigues had given him over the years.

But Nishida said he would not have paid Rodrigues had it not been for the UPW contract -- from which he was averaging $9,000 to $11,000 in commissions per month from June 1996 to November 1998 -- with Transamerica. And he would not have made those payments had he not been receiving hefty commissions from his employer.

Nishida said Rodrigues did not solicit the payments and never requested or encouraged him to give him money. But he also said Rodrigues did not refuse the money or give it back.

Under questioning by Assistant U.S. Attorney Lynn Panagakos, Nishida agreed that he made 24 withdrawals from his checking account totaling $136,400 from 1993 to 1998, based on bank records.

Of these large cash withdrawals -- $5,000 or more -- "almost all of it" went to Rodrigues, Nishida said.

He said delivered the payments, in $100 denominations, to Rodrigues at the UPW offices on North School Street and on one occasion when the two met for coffee at Kenny's Restaurant just down the road at the Kamehameha Shopping Center.

Under questioning by defense attorney Doron Weinberg, Nishida acknowledged he withdrew at least $136,400 from his personal checking account, from which he paid Rodrigues $125,000.

But he could not say exactly what he did with the money. "I made a lot of money, and I spent it," he said. "I don't know exactly what I spent it on."

Later, he acknowledged he used the money for personal expenses, "going out with the guys" and gifts.

Nishida also acknowledged he continued to make large withdrawals -- $22,600 over the first eight months in 1999 -- even after he had stopped paying Rodrigues in December 1998.

Nishida said he stopped making payments when he learned that Rodrigues was the subject of a federal criminal investigation.

During a discussion he had with Rodrigues about the investigation, Rodrigues told him that "no one knows about the payments" and "there was no proof."

Nishida said he kept no records about the cash payments and told no one about it.