Press Release
U.S. Department of Justice
United States Attorney
District of Hawaii
PJKK Federal Building (808) 541-2850
300 Ala Moana Blvd., Room 6-100 FAX (808) 541-2958
Honolulu, Hawaii 96850
October 9, 2007
For Immediate Release
P R E S S R E L E A S E
Edward H. Kubo, Jr., United States Attorney for the District of Hawaii, announced that WALTER Y. ARAKAKI, 68, of Honolulu, Hawaii, entered a guilty plea today in U.S. District Court to one count of mail fraud, in a case that arose out of the investigation by the U.S. Department of Justice and the Attorney General of the State of Hawaii into contracting fraud and public corruption at the Honolulu International Airport.
Court documents state that ARAKAKI, through his business, Walter Y. Arakaki, General Contractor, Inc., was involved in a scheme to defraud the State of Hawaii through the use of fraudulent "complimentary bids" that were submitted to make it appear as if the bid process engaged in complied with state procurement law requirements. This scheme was used to hide the fact that state contracting officials working at the airport were directing the repair and maintenance contracts to friends and favored contractors.
ARAKAKI admitted as part of his guilty plea that the repair and maintenance work done by his company on the Airport Fireboat House was obtained through a series of "Small Purchase Contracts" under state procurement laws which limited such contracts to no more than $25,000. To make it appear as if the state procurement law was being followed, ARAKAKI submitted two bids from other contractors along with his bid. ARAKAKI admitted that between March and May, 1999, his company was awarded three separate contracts for work all associated with repairs and maintenance to the Fireboat House, in the amounts of $24,997.04, $24,999.80, and $24,006.31. For each such contract ARAKAKI was awarded, he submitted two "complimentary bids" that were purposely made higher than his bid in order to insure that he was awarded the contract.
ARAKAKI was the last individual indicted by the U.S. Attorney's Office as part of its investigation into contracting fraud at the Airport.
Sentencing is set for April 7, 2008, before the Honorable David Alan Ezra, U.S. District Judge. ARAKAKI faces a maximum penalty of five years in prison, and a $250,000 fine.
The prosecution is being handled by Assistant United States Attorney William L. Shipley.
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