Hiram Fong Sr. blames
bankruptcy filing
on family feud

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By Tim Ruel
truel@starbulletin.com

Former U.S. Sen. Hiram Leong Fong Sr., 96, climbed his way to prominence only to spend the late years of his life embroiled in legal and money battles. Fong, a self-made millionaire, filed for bankruptcy yesterday, owing as much as $10 million in debt.

Hiram Fong: Born in Kalihi, he rose from poverty to become a self-made millionaire

A document filed in U.S. Bankruptcy Court shows that Fong owes money to a range of people, including family and long-time associates.

Fong's debts include:

>> $250,000 owed to an estate of his late sister Beatrice Ching

>> $50,000 owed to Fong's daughter, Merie-Ellen Gushi

>> $47,000 owed to Daniel Lau, who with Fong and others established the Finance Factors group of companies.

>> $2,500 owed to Hunnie Yee, the ex-wife of Wadsworth Yee, who founded Grand Pacific Life Insurance with Fong.

Fong's creditors include several of the biggest local banks, including Bank of Hawaii, First Hawaiian Bank, American Savings Bank and Hawaii National Bank.

Fong, a Kalihi boy, rose from poverty to become the first U.S. senator of Asian ancestry. A Republican, he served in the Senate from 1959 until his retirement in 1977.

But Fong's empire recently began to show cracks.

His son Hiram Jr. was forced into bankruptcy last year.

Hiram Sr. was sued by Bank of Hawaii and N. Harwood Street Partners of Texas in separate lawsuits, each alleging that Fong and other family members defaulted on hundreds of thousands of dollars in debt.

Marvin Fong, a son who has filed lawsuits against his parents, told the Star-Bulletin last year that his father had accumulated so much debt that he no longer could get any loans from banks.

At the time, Marvin Fong attributed the problems to his father borrowing money to help Hiram Jr., Fong's eldest son.

"Instead of holding my brother accountable, he just goes and bails him out and gets into trouble himself," Marvin Fong said last year. "(My wife and I) tried to steer him away from all this borrowing, but he just wouldn't listen to us."

Hiram Jr. was forced into bankruptcy by a family who won a legal malpractice judgment against him in 1993 that wasn't paid, according to bankruptcy court records. With interest, the judgment totaled more than $1.8 million as of late last year. The Federal Deposit Insurance Corp. has banned Hiram Jr. from involvement in any federally insured financial institution.

Yesterday's Chapter 11 bankruptcy filing will temporarily prevent any creditors from moving in and foreclosing on Hiram Sr.'s assets while he reorganizes his finances, subject to court approval.

Last year, Fong lost ownership of a Kahaluu home to Grand Pacific Life Insurance because of mortgage problems.

His assets are estimated to be worth between $10 million and $50 million, according to his bankruptcy filing.

Harrison Chung, Fong's attorney, declined comment yesterday.

In a statement, Fong described the bankruptcy as one of the most difficult decisions of his life.

"I feel this is the only way I can regain control of my financial situation," Fong said.

Fong blamed the bankruptcy on his son Marvin and Marvin's wife, Sandra. Marvin has sued Fong and his wife, Ellyn, in a dispute related to control of Market City Ltd., a company owned by several families.

"After suing his mother and me, they have refused to settle the differences between us," Fong said.

Marvin and Sandra could not be reached for comment yesterday.