2012-12-12 Board of Ethics minutes

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Hawaiian Bank account number 20010201, for a period of 184 days with a maturity date of September the 2nd, 2011, identical to the maturity date of this bond, March the 2nd 2011, at an interest rate of 0.1225%, which is one-tenth the interest rate that the County of Hawai‘i, the people of Hawai‘i, were paying to Bank of Hawai‘i. I guess we’d make a profit on the volume on this, wouldn’t we. In addition, I was sent the actual copy of the bill with the signature of the mayor on it. Again we go, all right. Now what we don’t know, or what isn’t said here, is the information I got is there is also a set of series A bonds issued for $10 million. When questioned as to what happened to all the information ________ of bonds, the County of Hawai‘i only offered bonds to Bank of Hawai‘i. The County of Hawai‘i did not offer bonds to any other financial organization to see if we could get a better rate. That in itself is a violation, but unfortunately, due to a bowling conflict on a team membership, that couldn’t be heard by this council apparently. Now Chair Blalis—Balser—excuse me, you are a financial manager, so you are very much aware of the violations of the Securities Exchange Commissions, the state and federal laws on bank fraud—I have no point here. What I’m asking, and what I’m requesting under the pureness of the jurisdiction of this body, is to allow this case to go forward, this hearing to go forward, into a formal hearing where individuals may be subpoenaed, and sworn oath taken, where Mayor Kenoi may sit here before you, swear an oath, and tell the people of Hawai‘i why he sold $10 million worth of bonds without the authorization of the Council, why it was in the County’s interest—in the people’s interest—that he was elected to support. How was it in their interest that Bank of Hawai‘i was able to use $10 million of their money at 1/8th of a percent interest while they were paying one point and a quarter interest. What value does it have to them? So I request that you approve this petition to go forward for a formal hearing so that rules of discovery under the Hawai‘i Revised Statute and the court rules may proceed. However, I understand, and I would be entirely shocked if you actually went through—but I cannot understand that this committee, or this Board, would allow this to go forward due to personal or the influence of racketeering and corruption and public corruption. Do you have any questions? Mr. BALSIS: Are there any questions from any of the members of the Board at this time? MR. HENRICKS: None. MR. BALSIS: I have a question for you. You’re referring to the sales of the bonds, and I remember, not extremely specifically, when the matter came up as to how the County structured the short-term monies before the long-term bonds were being purchased by others. Are you referring to the short-term bond, or are you referring to the long-term issuance? MR. COLE: That has no bearing here whatsoever. However, I will answer your question. The County Charter states that under Section 6-6-1 [sic] organization, Department of Finance, under Section 6-6.3, Powers, Duties, and Functions, under (c) of that section it states “negotiate loans and issuance and sale of bonds