"No jail time for Honolulu airport bid-rigging"

Thursday, April 12, 2007

No jail time for airport bid-rigging
By Debra Barayuga
The Honolulu (HI) Star Bulletin


An electrical contractor will not serve jail time for overbilling the state
thousands of dollars in a bid-rigging scam that landed him $500,000 in work
contracts at Honolulu Airport.

Circuit Judge Richard Perkins granted Bert Shiosaki's request yesterday to
defer his guilty plea to first-degree theft for a five-year period as long
as he stays out of trouble. But he ordered that Shiosaki repay the state
$146,000 at a rate of at least $1,000 per month.

Shiosaki, president of CBS Electric Inc., contends he did not make any money
from the scheme. He is the last of five contractors charged in state court
to be sentenced in what has been billed as the state's largest procurement
fraud -- surpassing the Ewa Villages relocation project scam, where $5
million was stolen.

Deputy Attorney General Christopher Young said he hopes the case serves as a
warning to all state employees that procurement laws need to be followed and
that the attorney general will prosecute those who break the law.

"The laws are to ensure the public pays for what is reasonable," Young said.

In January 2004, Shiosaki, of Mililani, admitted to submitting bogus
"complementary bids" that were higher than his so he was guaranteed to get
the job.

He admitted to overbilling the state $146,000 from March 1999 to October
2001 for jobs under the $25,000 threshold. In exchange for the contracts,
Shiosaki said he kicked back $8,100 in political donations or other favors
sought by two airport officials. He said he paid the kickbacks to ensure he
would continue to get jobs.

State contracts under $25,000 require only that three bids be submitted from
a list of approved contractors. Contracts over $25,000 require sealed bids.

The scheme involved submitting bids that were overinflated or that
circumvented the formal bidding process for larger contracts by being broken
down into smaller projects, referred to as parceling. In some cases the work
was not completed, Young said.

The state opposed a deferral for Shiosaki, saying he was not as forthcoming
in his cooperation as four other contractors who pleaded guilty in state
court.

Shiosaki and his attorney could not be reached later for comment.

Roy Shimotsukasa, president of AAA Termite & Pest Control Inc., Herbert
Hirota of Hirota Painting Co., Arthur Inada of Blueprint Builders Inc. and
Roy Yoshida of Yoshida's Auto Paint Shop all received deferrals of their
guilty pleas last year.

Their testimonies in federal court last October helped secure mail fraud and
conspiracy convictions against Richard Okada, former administrator of the
airport's Visitors Information Program, and Dennis Hirokawa, former airport
maintenance supervisor. Both had been accused of steering small contracts to
friends and acquaintances in exchange for kickbacks.

Contractors Wesley Uemura and Michael Furukawa were also found guilty. The
U.S. Attorney's Office contends they overbilled the state $2.5 million to $5
million between 1998 and 2000. All four await sentencing.

Civil proceedings to recover more than $1.2 million from Okada, Hirokawa and
the other defendants are ongoing.

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