Harris donor gets
fined for illegal giftsBut the engineering
firm's CEO could get his case
expunged after five years
A state judge ordered the chief executive of one of the state's largest engineering firms to perform 300 hours of community service and to pay $15,000 to the state Crime Victims Compensation Fund.
But Circuit Judge Karl Sakamoto also gave SSFM International Chief Executive Officer Michael Matsumoto an opportunity to have his criminal case expunged after five years if he abides by certain conditions similar to probation.
Sakamoto rejected a prosecutor's request yesterday for a harsher sentence that included probation and a $54,000 fine, citing Matsumoto's extensive community service work.
"Mr. Matsumoto engaged in a common pattern and practice that has existed for several years and has been through several generations of campaigns," Sakamoto said.
"It still does not make it right. It was an unlawful practice. That practice gave an unfair advantage to the campaigns involved and disadvantaged the others. It really, really, diminished the integrity of the voting process."
In January, Matsumoto entered a no-contest plea to a money-laundering charge that he funneled $139,500 to Honolulu Mayor Jeremy Harris' political campaign, making him the first person to be successfully prosecuted by city Prosecutor Peter Carlisle in his 18-month investigation into the Harris campaign.
Matsumoto also pleaded no contest to a misdemeanor charge that he made political contributions under false names.
Matsumoto, who appeared in court with dozens of family members and friends, apologized for his actions, but declined to answer questions about his case.
His attorney, Howard Luke, said his client is guilty of making false-name campaign donations and should expect "an astronomical" civil fine by the state Campaign Spending Commission for those violations.
But Luke said Matsumoto did not violate the state's money-laundering laws and was forced by prosecutors to accept the no-contest plea for that crime against his advice.
"Why is SSFM the first company up to bat? The answer is very simple: He didn't hide anything. This is the easiest paper trail that the prosecutor had," Luke said. "Nothing was hidden. It was all done by check. It was done all above board."
Matsumoto's firm, SSFM, is a major contractor for the city and served as its consultant for the $45 million Central Oahu Regional Park project, which has incurred millions of dollars in cost overruns.
City records reviewed by the Star-Bulletin showed that SSFM's nonbid consulting contract for the sports complex soared to $3.2 million from $932,000 as a result of four amendments.
According to records compiled by the state Campaign Spending Commission, SSFM is linked to donors who contributed $400,000 to more than half a dozen local political candidates during the past decade.
Nearly half of that went to the Harris campaign, while former Gov. Ben Cayetano's 1998 re-election bid received more than $100,000.
Under state law, a donor can give no more than $4,000 to a mayoral candidate and $6,000 to a gubernatorial candidate during a four-year election cycle.
Deputy Prosecutor Randal Lee said he was disappointed by the sentence because it allows a person who admitted laundering more than $100,000 to walk out of court with no criminal conviction on his record. Lee said that Matsumoto did not cooperate with his office's investigation as required under a plea agreement.
Matsumoto also placed dozens of relatives, friends and employees under the threat of criminal prosecution when he laundered campaign funds in their names, according to Lee.
The company also deducted some of the contributions as business expenses, as if campaign contributions are part of the ordinary cost of doing business in Hawaii, Lee said.
At least one SSFM employee had to borrow money from the company's 401K retirement plan to make political donations to Harris, Lee said.
"There is a driving force to make these contributions and there is a driving force that these amounts have to be substantial and there is a driving force that the amounts have to be given at a certain time," Lee said.
"Elections should not -- cannot -- be based on which candidate has the most money," he said. "Elections should not be based on which candidates could buy the most votes. I think the message is clear that the public distrusts the system and the public lacks faith in the system and the public realizes that the system is not fair."