Federal authorities: Ex-defense contractor lied to purchase $4.5M mansion

HONOLULU (HawaiiNewsNow) - A former Hawaii businessman who stole pandemic aid funds and made illegal campaign contributions is facing even more trouble.

Another grand jury indictment has been filed against Martin Kao, the former head of Martin Defense Group, once known as Navatek.

In it, federal authorities accuse Kao of committing bank fraud in a real estate deal for his $4.5 million Kahala home. The home on Kahala Avenue was purchased in June 2020.

The government intends to seize the home if he is convicted.

Last year, Kao pleaded guilty to eight counts, including fraud and money laundering for a scheme to steal nearly $13 million in pandemic relief funds from the Paycheck Protection Program, meant to help those left unemployed during COVID-19 shutdowns.

He also pleaded guilty to campaign finance violations for funneling more than $200,000 to a U.S. Senator from Maine, who awarded his defense firm a contract in her state.

“It is rare to see the government bring a separate indictment after someone has pled guilty,” said legal expert Megan Kau.

Kau represented one of the co-defendants in the previous case.

She said she has no inside knowledge of the new indictment but said the government does use criminal charges in forfeiture cases. “The bank itself doesn’t have the standing to bring a criminal case against someone that has fraudulently obtained property and therefore the government has to be the one the entity to do that,” Kau said.

Kao has been on house arrest on a $2 million bond pending sentencing for the previous cases.

He is expected to be in court on the new charge next week.

Kao’s attorney, Victor Bakke, had no comment.

Copyright 2023 Hawaii News Now. All rights reserved.