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3 ex-city executives charged as part of sprawling Kealoha corruption probe

Five years after former HPD Chief Louis Kealoha got a hefty payout, the FBI arrested three former officials accused of cutting the deal behind closed doors.
Published: Jan. 12, 2022 at 7:30 AM HST|Updated: Jan. 14, 2022 at 6:34 AM HST
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HONOLULU (HawaiiNewsNow) - In a stunning scene Wednesday morning, three former high-ranking city officials surrendered to the FBI as part of the ongoing massive public corruption probe that resulted in the conviction of ex-Honolulu Police Chief Louis Kealoha and his wife, Katherine.

The three, who all served in the former Mayor Kirk Caldwell administration, are:

  • Former city Managing Director Roy Amemiya;
  • Ex-Honolulu Police Commissioner Max Sword;
  • And former Corporation Counsel Donna Leong, who was the city’s top civil attorney.

They turned themselves in at the FBI’s Kapolei office on Wednesday morning and were subsequently charged with conspiracy to defraud the U.S. as part of the city’s $250,000 payout to the disgraced former police chief in 2017, despite the fact that he was already a target of a federal investigation.

Three former high-ranking city officials surrendered to the FBI as part of the ongoing massive public corruption probe involving the Kealohas.

All three pleaded not guilty in a virtual hearing before Federal Magistrate Rom Trader.

“I’m quite bewildered and angry,” said Amemiya. “I’m bewildered because they are pursuing a case against me in a matter that I was not involved in. I’m angry because the federal law enforcement is challenging my ethics and my integrity and those are values that are very, very important to me.”

Amemiya was first to arrive at the FBI offices in Kapolei followed by Sword. The FBI came out and handcuffed Leong after she sat in her car for at least 15 minutes.

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Randal Lee, a retired judge and longtime prosecutor, said the video of her being arrested is extremely embarrassing for an officer of the law.

“It’s a image that should serve as a deterrent that even though you’re in a high-level executive position, you’re not above the law,” said Lee, a professor of criminal justice at Hawaii Pacific University.

A timeline shows the alleged events in 2017 surrounding the Kealoha payout that led to the arrests of three former high-ranking city officials.

In a statement, Leong’s attorney Lynn Panagakos called her arrest in the parking lot “theatrics.”

“Whoever tipped off the media so that Ms. Leong could be filmed while being handcuffed should be ashamed of themselves,” said Panagakos.

After appearing in court, all three were released on an unsecured $50,000 bond on several conditions.

Prosecutors allege the trio conspired to parcel the $250,000 payout over the objections of the Honolulu Police Department and then hide details of the deal from the Honolulu City Council. The case is a federal one because it involved money from HPD, which receives significant federal dollars.

According to the indictment, when pressed by Honolulu Police Department officials on why the Kealoha payout needed to be funded from police department accounts, Sword allegedly responded: “So you don’t have to go to the seven bananas, I mean nine bananas up at the Council.”

Federal authorities also alleged the three “provided materially false and misleading statements to federal agents during their investigation of the Kealoha payout.”

Panagakos said in her statement Wednesday that the payout was “entirely legal” and in the interest of Honolulu taxpayers.

“It is beyond ironic that the same attorneys that prosecuted the Kealohas for corruption are now accusing Donna Leong for legal actions she took in relation to the Honolulu Police Commission’s decision to expeditiously separate former Chief Kealoha from HPD, " Panagakos said.

William McCorriston, Sword’s lawyer, said his client is both “shocked and disappointed” by the indictment. He said the former police commission chair was simply following the legal advice from Leong’s office and the recommendations of the administration.

“Mr. Sword served as a volunteer on the Honolulu Police Commission for 10 years and has served on numerous boards and in other volunteer positions over the years and built a solid reputation for honesty, integrity, and service to the community,” McCorriston said, in a statement.

“We will vigorously defend Mr. Sword from this unjust charge.”

Meanwhile, Honolulu Mayor Rick Blangiardi called the allegations against the three troubling.

“The Administration recognizes the indictment contains allegations, not facts, and will monitor the matter closely,” he said, in a statement. “We are committed to ending public corruption and restoring faith in government.”

The charges come as federal authorities continue to investigate former city Prosecutor Keith Kaneshiro as part of a separate probe. Louis Kealoha, meanwhile, is serving a serving a seven-year prison term in Oregon for obstruction, conspiracy and bank fraud ― all crimes committed while he led HPD.

This is a developing story. Please check back for updates.

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