City sues disgraced ex-police chief in bid to recoup $250,000 payout

Updated: Jan. 16, 2020 at 5:26 PM HST
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HONOLULU, Hawaii (HawaiiNewsNow) - The city is suing disgraced, ex-Police Chief Louis Kealoha to try and get $250,000 in taxpayer dollars back ― a payout he got to leave his post.

In January 2017, taxpayers paid the $250,000 for him to retire while under investigation by the FBI for public corruption.

All but one of the Honolulu’s police commissioners voted in favor of the agreement, fearing Kealoha would file a wrongful termination lawsuit if he was forced out without the deal.

[Read more: Experts: City unlikely to recoup Louis Kealoha’s $250,000 payout]

The lawsuit, filed Wednesday, accuses Kealoha of breach of contract, saying he’s not holding up his end of the agreement to repay the money if he’s convicted or pleads guilty to a felony crime.

Both happened. In June, a jury convicted him of conspiracy and obstruction. Then in October, he pleaded guilty to bank fraud.

The lawsuit says the city sent a letter to Kealoha but he "has not responded nor has he returned the severance payment of $250,000, which is a breach of the agreement.”

The lawsuit requests a jury trial and relief, which includes the money plus legal fees.

Attorney Victor Bakke, who criticized the deal, doesn’t believe the taxpayers will ever see the money again. “People all the time owe money, they get found liable to pay the money back and then they just never do because they don’t have the money and the city can chase that forever," he said.

Loretta Sheehan, the only police commissioner to vote against the agreement, told Hawaii News Now in October that she offered alternatives to this agreement but was met with resistance.

She says there were many other community groups that could have benefited from the money instead.

“There are a lot of organizations that would welcomed a quarter of a million dollars and we threw this money away and it’s such a shame," she said.

Sheehan, a former federal prosecutor, believes Kealoha actually has until March to repay the money because that’s when he’ll be sentenced.

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