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Man who staged disappearance is out of prison, unemployed

By Leila Fujimori


Question: Whatever happened to the accountant who staged his own disappearance by dumping his new Mercedes-Benz off a cliff at Makapuu in 2005 after embezzling thousands of dollars from two businesses?

Answer: Kenneth J. Peters Jr., then 31, returned March 25, 2005, from a trip to Bangkok, two days after his new Mercedes-Benz was discovered 70 feet down a Makapuu cliffside.

Customs officials stopped him at Honolulu Airport for having in his possession $15,000 in undeclared cash and escorted him to the police station.

Peters, now 37, had embezzled about $190,000 from his employers, Flight School Hawaii and SB Island Interiors LLC, doing business as Studio Becker.

Peters had taken flying lessons from Flight School Hawaii and had planned to use the money to compete with his former employer, Deputy Prosecutor Chris Van Marter had said.

Peters created a company, KenQuest & Co., where he funneled forged checks he stole from his employers.

He pleaded no contest and was convicted June 22, 2006, of 29 counts of money laundering, second-degree forgery, first-degree theft and fraudulent use of a credit card.

When Circuit Judge Virginia Crandall sentenced him in 2006 to a maximum of 10 years, she said that in addition to providing adequate deterrence, “it would allow him to begin paying back his victims upon release from prison.”

After serving four years of the sentence in Saguaro Correctional Facility in Eloy, Ariz., Peters was brought back to Hawaii and released on parole Sept. 23, 2010, said Tommy Johnson, Hawaii Paroling Authority administrator.

Peters owes Flight School Hawaii $133,975 and SB Island Interiors $54,677.

Johnson said Peters is required to pay at least 10 percent of his adjusted gross income to restitution through the Crime Victim Compensation Commission.

Johnson said Peters, who now lives on Hawaii island, had a temporary job in November and December, and made a restitution payment Jan. 11. He has found no work since then, Johnson said. He also made $60 in restitution payments while incarcerated.

After an inquiry by the Star-Advertiser, a victim compensation commission official said purchase orders were cut Tuesday for $120 restitution for each of the former owners of the two companies.

Former Flight School Hawaii owner Wallace Frelander never got any restitution from Peters’ prison job because the commission did not have a current address for him.

Rick Cowan, former co-owner of SB Island Interiors, got a $20 check for wages Peters received in prison, the commission said.


This update was written by Leila Fujimori. You can write to us at Whatever Happened To …, Honolulu Star-Advertiser, 500 Ala Moana Blvd., Suite 7-210, Honolulu 96813; call 529-4747; or email

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