State charges Big Isle Mayor Billy Kenoi with theft

A grand jury indicted Hawaii County Mayor Billy Kenoi on theft charges Wednesday in connection with misuse of his county-issued purchasing card.

The mayor is charged with two counts of second-degree theft, a Class C felony; two counts of third-degree theft, misdemeanors; three counts of tampering with a government record, misdemeanors; and one count of false swearing (making a false statement under oath), a petty misdemeanor.

A bench warrant was issued for his arrest following the indictment, and the mayor was to be released on his own recognizance once booked. It was unclear Wednesday night when the arrest would take place.

After the indictment, Kenoi’s attorney Todd Eddins said the mayor would not resign.

“There’s been noncompliance with a credit card policy, but clearly there’s been no crime,” Eddins said. “Every dollar spent was transparent. Nothing was hidden. Each expense by the mayor served a county purpose or was described in black and white as an expense to be reimbursed.

“The county is not out one penny,” he said. “Mayor Kenoi has not enriched himself one penny. It is feeble factually and legally for the state government to claim that Mayor Kenoi stole from his hometown.”

The mayor is expected to make a statement today.

But Wednesday before he was indicted, the mayor was in Hilo giving his annual speech to the Japanese Chamber of Commerce & Industry of Hawaii, according to a video posted by Big Island Video News.

“I stand here in 2016, my last year as mayor of the County of Hawaii, to tell you I would never disrespect the county … disrespect you by taking anything,” the mayor says in the video.

“A couple years ago they wen’ try give me one raise — $23,000. I refused to take it and gave it to the United Way,” he said. “I never made one press release, I just did ’em.”

The video shows he concluded by saying he plans to retire from politics in November, and, “I look forward to continue to call Hawaii island home.”

Kenoi has acknowledged making unauthorized purchases of more than $129,000 for personal purposes, including trips to Honolulu hostess bars, but said he has since reimbursed the county.

“The Department of the Attorney General sought this indictment after an extensive investigation that lasted almost a year,” state Attorney General Doug Chin said. “I thank the investigators and prosecutors for their efforts.”

He declined to give further details on the charges and number of counts. “What led us to charge those particular counts will be presented at trial,” he said.

A county audit showed charges of $129,580.73 on Kenoi’s county-issued credit card, known as a pCard, which included lavish spending at luxury hotels, restaurants and bars in Hawaii and on trips to Japan; the Philippines; Washington, D.C.; Las Vegas; Texas; and San Francisco.

Kenoi also used his pCard to pay for a $1,200 surfboard, his $565 Hawaii State Bar Association dues and luxury stays at the Marriott Wai­ko­loa Beach at $469 per night. He also spent $400 at the Camelot Restaurant and Lounge hostess bar and $892 at the Club Evergreen hostess bar — both in Honolulu.

Kenoi has publicly apologized and taken responsibility for his actions.

He became the second sitting mayor in Hawaii history to be indicted on criminal charges. Honolulu Mayor Frank Fasi was indicted in 1977, accused of accepting a bribe in awarding a multimillion-dollar contract in exchange for a $500,000 campaign contribution, but the charges were later dropped because a key witness refused to testify.

Kenoi’s alleged pCard abuses came to light after West Hawaii Today broke the story on March 29, 2014. Kenoi initially reimbursed the county $7,500 on March 31. The county’s finance director said she and the former finance director had repeatedly talked to Kenoi about not using the card for personal use.

The indictment states that the felony theft charges stem from pCard purchases that allegedly occurred from May 11, 2011, to Oct. 20, 2015. The indictment also charged Kenoi with three counts of tampering with a government record for allegedly falsifying entries in his pCard reports:

>> An Oct. 20, 2011, purchase at the Hilo Yacht Club described as an office strategic planning luncheon.

>> A purchase on March 17, 2013, at Longs Drugs, listed as an expenditure for the Sam Choy’s Poke Contest Volunteer Appreciation Event.

>> A June 30, 2014, purchase at Volcano House Restaurant described as a luncheon for visitors from the U.S. Conference of Mayors.

Kenoi’s second term as mayor ends in December. Chin, the state attorney general, said a criminal case can take from six months to more than a year before a trial is held.

“We’re certainly going to do whatever we can to make sure we don’t violate Mayor Kenoi’s rights to a speedy trial,” he said.

County Prosecutor Mitch Roth and Chin had been in discussions since the allegations were initially raised and had agreed that the Attorney General’s Office should handle the case because there would have been a conflict of interest for the county to handle the case.

In May, the Hawaii County Board of Ethics deferred taking action on a complaint about Kenoi’s pCard spending raised by a Kapaau resident until after the criminal investigation was completed.

Once the allegations arose, the County Council took no action on a request to reprimand Kenoi, with Councilwoman Margaret Wille being the lone member speaking out against abuse of his pCard.

Wille said last week: “The impression is the mayor is retaliatory. He runs a tight ship. Nobody ever contradicted him.”