Evidence of Fraud, Waste, and Abuse at OHA from 2012-2016
by OHA Trustee Keli‘i Akina, PhD, Ka Wai Ola, December 1, 2022
A forensic review performed by auditing firm Plante Moran has identified evidence of fraud, waste, and abuse related to 22 financial transactions, worth over $7 million, made by the Office of Hawaiian Affairs (OHA) from 2012 to 2016. This evidence confirms my concerns about what was going on within OHA at that time. That is largely why I sought to become a trustee and called for an independent review of OHA’s financial transactions.
In 2017, my first major action in office was spearheading the Clifton Allen Larsen (CLA) independent review of OHA’s financial transactions from 2012 to 2016. In 2019, CLA reported their findings which included 38 “red flag” transactions. These findings showed “indicators” of fraud, waste, and abuse. At the beginning of 2022, OHA contracted with Plante Moran, a forensic auditing firm, to determine whether the 38 red flag transactions had actual “evidence” of fraud, waste, and abuse.
Most of the evidence that Plante Moran found and relied on to make their determinations were based on the collection of emails and an analysis of supporting documentation. Specific individuals, such as former OHA staffers and former members of OHA’s administration in addition to individuals from specific vendors, were referenced in regard to fraud, waste, and abuse.
Here is a brief overview of some of Plante Moran’s findings:
- Akamai Foundation: OHA awarded a grant to the Akamai Foundation worth roughly $2.6 million. OHA may have violated contract policies, a potential breach of fiduciary duties related to contract oversight may have occurred, and funds were disbursed without supporting documentation. Plante Moran referenced a former OHA CEO related to this transaction.
- WCIT Architecture: OHA contracted with WCIT Architecture in the amount of $2.9 million. Funds were disbursed without appropriate documentation and a potential conflict of interest between a member of WCIT Architecture and a former OHA Trustee was referenced by Plante Moran.
- ʻAha Kāne: OHA awarded a grant worth $200,000 to ʻAha Kāne. Irregularities were found in the grant process, and a potential conflict of interest between ʻAha Kāne, a former OHA staffer and a former OHA CEO may have occurred. ʻAha Kāne was founded by a former OHA CEO prior to that individual becoming CEO at OHA. There was no documentation to confirm expenditures, false statements were made by ʻAha Kāne members to grantors, and false statements were made by a former OHA CEO to the State Ethics Commission, as documented by Plante Moran.
- SWAY: OHA contracted with SWAY in the amount of roughly $294,000 despite not having approval from OHA’s Trustees. OHA staff also expressed concerns about the contract not going through the appropriate procurement process. A potential conflict of interest between a former OHA CEO and a member from SWAY may have occurred, as referenced by Plante Moran.
If you would like to read more about the 22 transactions of fraud, waste, and abuse reported by Plante Moran, I have prepared a detailed summary titled “Red Flags 2: A Summary and Analysis of Plante Moran’s Evidence of Fraud, Waste and Abuse at OHA.”
OHA Trustees have taken a historic step toward greater transparency and have implemented significant reforms. Now it is time to go even further toward complete accountability. Individuals guilty of criminal activity must be brought to justice, and valuable funds taken from the Hawaiian people must be recovered.
On the bright side, OHA is today a totally different place than it was from 2012 to 2016. Looking back, there was a culture that made it easy for fraud, waste, and abuse to occur. That culture is no longer here.
LINK: Read “Red Flags 2”