Big Island public official pleads guilty to embezzlement


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A former Big Island politician has pleaded guilty in federal court to the crime of embezzlement.

Stacy Higa, 58, a former Hilo, Hawai´i public servant, pleaded guilty on Wednesday October 13, 2021 to embezzling over $ 38,000 from AmeriCorps and also offering a bribe in exchange for grants under the framework. help with the coronavirus. Relief and Economic Security Act (CARES).

The announcement was made by Channing D Phillips, Acting U.S. Attorney for the District of Columbia, Deborah Jeffrey, Inspector General of AmeriCorps, and Steven Merrill, Special Agent in charge of the FBI Field Office in Honolulu.

Higa pleaded guilty in U.S. District Court for the District of Columbia to one count of embezzlement and corruption. Both counts carry a legal maximum penalty of 10 years in prison and financial penalties. Under federal sentencing guidelines, Higa faces between 46 and 57 months in prison and a fine of up to $ 200,000.

The plea agreement requires him to pay $ 38,642 in restitution to AmeriCorps and an identical amount in a forfeiture judgment. The Honorable Reggie B Walton set the sentence for January 13, 2022.

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“Our communities place great trust and responsibility in our public figures. Stacy Higa ultimately betrayed that trust when he abused his power to embezzle federal funds and participate in bribes, ”said FBI Special Agent in Charge Merrill. “The FBI will not tolerate these crimes and will hold the perpetrators accountable for their actions. Today’s guilty plea is a direct result of the hard work and dedication of the FBI and our law enforcement partners to secure
Justice.”

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AmeriCorps is a federally funded network of national service programs that meet basic community needs, such as improving educational outcomes, mentoring youth, alleviating poverty, maintaining national parks, disaster preparedness, etc. AmeriCorps National Service members agree to serve for a specified period, typically one year, in exchange for a living allowance, funding to be used for tuition, and other benefits.

From June 2011 to May 2020, Higa, a former Hawaii County Council member and mayoral candidate, served as executive director of the Hawaii Commission for National and Community Service, the state services commission responsible for of the administration of the AmeriCorps programs in Hawaii.

From February 2018 until his resignation from the Commission, Higa embezzled over $ 38,000 of AmeriCorps funds by signing and authorizing contracts and purchase orders between the Hawaiian Commission and two companies he owned or controlled, without revealing his control over companies. Higa spent the embezzled funds to
personal expenses, including the payment of approximately $ 20,000 for optional cosmetic dental care.

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In his advocacy, Higa also admitted to implementing a program involving the CARES law, which was enacted in March 2020 to provide financial assistance to individuals, businesses, states and localities suffering from the economic effects of the pandemic of COVID-19. Among other relief programs, the CARES Act created a $ 150 billion Coronavirus Relief Fund (CRF) to be distributed to states, communities and tribal governments to support expenses incurred due to COVID-19.

Government entities that received money from the FRC could use the funds, among other things, to provide grants to small businesses to reimburse the costs of business disruptions caused by required closures and to provide economic relief to people. experiencing an employment interruption.

In this program, Higa admitted to providing financial benefits to Hanalei Aipoalani, who was hired in August 2020 as the CARES Program Administrator for the Community Services Department of Honolulu City and County. Aipoalani was responsible for administering CRF programs.

From August 2020 to October 2020, Higa offered to provide financial benefits to Aipoalani in order to influence the approval of Higa’s applications for two grants totaling $ 845,000 under the CARES Act. Higa then asked an employee to draft and submit false and backdated invoices for the grants. Higa and Aipoalani discussed opening LLCs in Oahu and using their wives as directors to launder money. As part of his plea deal, Higa admitted to expecting to receive at least $ 250,000 in profits from the CARES Act funds.

Aipoalani, 42, of Waianae, Hawaii, pleaded guilty separately in US District Court for the District of Columbia to embezzling AmeriCorps funds and accepting a bribe under the CARES Act. Aipoalani was sentenced on June 30, 2021 to 46 months in prison and ordered to pay more than $ 532,730 in restitution to AmeriCorps.

On May 17, 2021, the Attorney General created the COVID-19 Fraud Enforcement Working Group to mobilize the resources of the Department of Justice in partnership with government agencies to strengthen efforts to combat and prevent the pandemic fraud.

The Working Group strengthens efforts to investigate and prosecute the most culpable national and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud, among other methods, by scaling up and integrating mechanisms coordination, identifying resources and techniques for uncovering fraudulent actors and their programs, and sharing and leveraging information and knowledge gained from previous enforcement efforts.

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