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Saturday, April 27, 2019
OHA CFO Ousted to Block 'Fair Treatment' of Grant Requests?
By Andrew Walden @ 9:27 PM :: 2054 Views :: Ethics, OHA

by Andrew Walden

If the Office of Hawaiian Affairs (OHA) were a publicly-traded corporation, the departure of a CFO would require an 8-K filing with the SEC.  

But OHA is a department of the State of Hawaii, not a publicly traded corporation.  So in January, when OHA’s last CFO, David Laeha, disappeared, there was no public announcement.  Laeha’s photo and bio simply evaporated from OHA’s website

An anonymous source tells Hawai’i Free Press Laeha “was escorted out of his office by OHA's HR” on January 8, 2019.  The CFO position has since remained vacant—without even a recruiting announcement--as OHA Trustees consider whether to retain OHA CEO Kamana’opono Crabbe—and Crabbe considers whether he wants to apply.

Unlike the secrecy surrounding his departure, Laeha's hiring was welcomed with an OHA statement April 26, 2017.  

Nine months later the Hawaii State Auditor released a devastating draft audit report focusing attention on OHA Grants and Sponsorships--"OHA Draft Audit: Millions given to those who 'know how and who to ask.'"  The audit report mostly covers events prior to Laeha's hiring.

Stories told by the source and by Laeha conflict, but both point to OHA's Grants and Sponsorships program. 

Here's what the source says about OHA Grants and Sponsorships:

"During the investigation, the grants program, which is one of the programs that the CFO oversees, was taken away from him. The grants program reported directly the interim COO instead and the CFO was banned from speaking to any of the grants staff."

Laeha explains:

"...(I) was in the process of implementing changes to the Sponsorships program which would adhere to the 'fair treatment' laws which require independent solicitations on contracts...."

Handout provided to OHA employees questioned in Laeha 'investigation'

Here’s what the source tells us:

A memo sent via email was sent to the Trustees and the OHA Executive team explaining that the CFO was terminated due to multiple violations of OHA policies and procedures.  The email/memo itself didn't list any specific reasons though. 

On January 8th, 2019, the CFO was escorted out of his office by OHA's HR.  He was placed on administrative leave until his official termination date on January 29th.  Something about having to give the trustees 3 weeks notification since it was an executive position…. 

Prior to this, there were several HR complaints against him by OHA employees, and at least one formal investigation on him which OHA had to hire an external investigator to conduct.  Since he became CFO, a total of at least 10 employees left the department that he directly oversaw – seven of those were resignations including a manager and his own assistant, one person retired, one person transferred to another OHA department, and one person was terminated.

The investigation … had to do with “retaliation and gender based discrimination resulting in a hostile workplace”.  During the investigation, the grants program, which is one of the programs that the CFO oversees, was taken away from him. The grants program reported directly the interim COO instead and the CFO was banned from speaking to any of the grants staff.

Other internal complaints from staff to OHA HR was also due to retaliation, age/gender discrimination, and other forms of discrimination and harassment (more verbal harassment, no sexual harassment claims). Violating OHA policy on hiring was another accusation. 

…There were several allegations made by staff.  His staff would “save” him over and over from procurement violations, financial policy violations, etc.  I am told that thanks to his staff, no major violations ever occurred under him, but his incompetence and retaliation against them afterwards were reported. 

If the akamai reader is experiencing deja vu, that might be because this litany of complaints so closely matches 'bullying' complaints against OHA Trustee Rowena Akana by OHA administrative staff as Crabbe launched the ultimately successful campaign to oust her.

We contacted Laeha for his side of the story “on the record for publication.”  Laeha responded:

…Although OHA has its flaws, for me it serves an important function to support the native Hawaiian community (unfortunately only $10M of its $46M budget going to grants, scholarships and sponsorships)….

I will say the audit brought out OHA’s current leadership’s lack of compliance with State laws.  Under my leadership, I implemented a full compliance policy and was the first CFO to provide quarterly financial reviews, all required reports to the legislature, restructured the Trustee Allowances to conform with state legislative policy and ethics commission, and was in the process of implementing changes to the Sponsorships program which would adhere to the “fair treatment” laws which require independent solicitations on contracts.  I ran a tight ship and raised concerns when spending was done irresponsibly or what I considered non-compliant with officer’s fiduciary duties.  Regarding personnel matters, I always included HR in all personnel matters and adhered to the company’s employee handbook. 

I believe the problem is with Kamanao’s leadership.  He was never qualified to assume the role he is in.  His term ends in June and it should not be extended….

After responding to the request for a statement "on the record for publication", Laeha then bizarrely asked, “please do not report on any of my comments.”

---30---

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