FILE PHOTO / MARCH 2002
Members of the Diego family, Robert, daughter Bobby Jean, and Momi pleaded no contest yesterday to charges that they stole $500,000 from a funeral plan trust fund.
Big Isle mortuary family
could get prison timeThe manager, his wife and daughter
plead no contest to charges
of raiding a trust fund
HILO >> Memorial Mortuary manager Robert Diego and two family members pleaded no contest yesterday to charges of stealing $500,000 from a funeral plan trust fund.
CORRECTION
Thursday, Sept. 4, 2003>> Members of the Robert Diego family, who own and operate Memorial Mortuary in Hilo, pleaded no contest Tuesday to theft of an unspecified amount that is more than $20,000 from a funeral plan trust fund. A Page A3 article yesterday incorrectly said Diego and two family members pleaded no contest to charges of stealing $500,000 from the fund. The plea agreement does not give a specific amount for which they are liable, but Deputy Attorney General Rick Damerville said he will seek about $500,000 in restitution.
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Under a plea agreement to a charge of first-degree theft, Diego, 60, could be sentenced to 10 years in prison and a $25,000 fine.
"He was the person primarily responsible. He was the leader," said Deputy Attorney General Rick Damerville.
Diego's wife, Momi, and their daughter Bobby Jean also entered no contest pleas, but under the agreement they would face no more than a year in prison. Judge Terence Yoshioka could also defer accepting their pleas, meaning they could eventually have clean records.
Yoshioka set sentencing for Feb. 10.
Two companies controlled by the Diegos, Memorial Mortuary and Memorial Mortuary Funeral Plan, also have criminal charges against them. They could be ordered to pay fines or to dissolve, said Damerville. The firms have almost no assets, he said.
The alleged thefts took place between 1989 and 2002, Damerville said. When pre-need funeral plans were sold, the Diegos failed to place the required 70 percent of the sales price in the trust fund, Damerville said.
They were using money from current sales to pay off past expenses, he said.
Robert Diego's attorney, Brian De Lima, said he was surprised by Damerville's statement that $500,000 is missing. "I think that number is extremely high," he said.
He said there were about 160 pre-need contracts when the state investigation began last year, and the number is now down to about 120. By sentencing next year, the financial picture should have improved further, De Lima said.
"They have performed all contracts (funerals) presented," De Lima said. "If they continue to perform at the clip they have been, the hope is for sufficient funds to cover remaining plans."
Attorney Brenda Carreira, who represents the two companies, said a third company, West Hawaii Mortuary, has been honoring funeral plans. That company, owned by the Diegos' daughters Ranalynn Naipo and Daphne Shinoda, is not under suspicion.
Damerville said he knows that putting all of the Diegos in jail would prevent them from making good on contracts. A lengthy presentence report will take into account the wishes of contract holders, he said.
Memorial and the Diegos came under suspicion because of complaints by Robert Diego's ex-girlfriend, Lucy Mossman. Her accusations suggested Diego buried people without caskets in the 1980s.
Diego said a cemetery company did the burials, not himself. Damerville said caskets, unless enclosed in concrete vaults, deteriorate "extremely rapidly" in Hawaii soils.
There wasn't enough evidence to back up Mossman's accusations, but her complaints led to the discovery of the missing money, Damerville said.
