Whistleblower Info: The Indonesian Connection

The Indonesian Connection

The Saga of Sukamto Sia

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January 31, 2006

Indonesia wins one in war on corruption

By Bill Guerin

JAKARTA – Indonesia has scored a major victory in the war on corruption after the return to the country of a crooked banker who fled before being sentenced in absentia to eight years in jail.

The US turned over fugitive David Nusa Wijaya to Indonesia on January 17 after he was located in Los Angeles four days earlier. The two countries do not have an extradition treaty. However, national police chief General Sutanto, who was hand-picked last year by the president, said Wijaya had been given two choices by the police.

“The first was for him to go through the legal process in the US and then be deported, while the second was to voluntarily undergo the legal process in Indonesia,” he said.

Wijaya, a 44-year-old ethnic Chinese wanted for embezzling about US$139 million, chose the latter, Sutanto said. This could suggest Wijaya believes that given time, he will find a way to escape justice yet again. However, he may find it much more difficult this time. President Susilo Bambang Yudhoyono is talking tough on seeing such criminals brought to justice.

“I don’t want any extortion, backroom deals or anything by the law enforcement people here that would create a more difficult situation for the judiciary,” Yudhoyono warned, when commenting on the joint operation by Indonesian police and the US Federal Bureau of Investigation that resulted in Wijaya’s capture in San Francisco.

Significantly, US assistance came less than a week after Washington praised Jakarta’s arrest of suspects in the 2002 murders of two American teachers in the province of Papua. The case was the main hurdle to restoring military ties between the two countries.

Once again, as with the Papua arrests, public statements confirm the strong relationship developing between Jakarta and Washington. “I am grateful to the friendly country that helped him [Wijaya] be brought to justice,” Yudhoyono said….

Wijaya had been on the run since 2004, a few weeks before Indonesia’s Supreme Court increased an earlier sentence to eight years for embezzlement in a scam linked to one of the biggest and nastiest wholesale fraud cases ever, the misuse of Bank Indonesia Liquidity Assistance (BLBI) in 1997-98.

In a related development, the owner of liquidated Bank Bira, Atang Latief (ex-father in law of Sukamto Sia) alias Lau Tjin Ho, returned to Indonesia on Friday to face trial over alleged embezzlement of Rp325 billion (US$34.7 million) in BLBI….

He arrived in Jakarta from Singapore and was immediately rushed to a hospital for an undisclosed illness, according to Antara news agency. Sutanto said a ban on Latief going abroad was issued in 2000 but later revoked by the immigration office….

www.atimes.com/atimes/Southeast_Asia/HA31Ae01.html

August 6, 2004

Sukamto Sia’s Lawyers To Pay
$6 Million In Settlement

By Tim Ruel, Honolulu Star-Bulletin

A Honolulu attorney and a high-powered law firm that represented imprisoned businessman Sukamto Sia during his bankruptcy proceedings must pay $6.25 million in a settlement over allegations they helped the former Indonesian investor hide assets from creditors.

Attorney Renton Nip and the former Washington, D.C., law firm Verner Liipfert Bernhard McPherson & Hand must pay the money to Sia’s bankruptcy estate, a Singapore bank, casinos that are owed money by Sia and the Federal Deposit Insurance Corp.

Sia pleaded guilty to federal bankruptcy fraud in 2001 and is in prison in Big Springs, Texas. He was to be released next month but his sentence has been placed in an indefinite status because Sia was recently found in contempt for not complying with a U.S. Bankruptcy Court order.

Sia’s bankruptcy trustee Guido Giacometti sued Verner Liipfert and Nip in 2002, saying they “entered into an overarching conspiracy to conceal and divert assets from (Sia’s) bankruptcy estate.” Later, the Singapore bank and the casinos filed separate lawsuits over similar allegations.

“I know in my heart that the suits were not fair and not right. The settlement, however excessive, brings the Chinese water torture finally to an end,” Nip said yesterday. He declined to elaborate.”

Warren Price III, attorney for the former Verner Liipfert law firm, said the defendants settled based on the decision of their insurance carrier, and that the settlement will be covered by insurance. Verner Liipfert and Nip dispute all of the claims against them.

“There were a number of parties involved and the defense costs were just going to be horrendous,” Price said.

Nip, who shares a law office with former Gov. John Waihee, was once affiliated with Verner Liipfert, which has since merged into the national law firm Piper Rudnick.

Under the settlement, approved last week by U.S. Bankruptcy Judge Lloyd King, Nip and Verner Liipfert do not admit liability. The casino companies, including London Clubs International plc, Aspinall’s Club Ltd. and Rio Casino, will get $2.5 million from the settlement, which is not as much as the $12 million in initial claims they filed against Sia’s bankruptcy estate.

The suits against Sia’s former lawyers will be dismissed and the casinos are waiving their right to seek more money from the bankruptcy estate.

Sia, who once was involved in selling land to the state for the $350 million Hawaii Convention Center, ran into financial problems with creditors in 1998. He filed bankruptcy in Honolulu, claiming he had nearly $300 million in debts and only $9.3 million in assets. Giacometti has since estimated the face value of Sia’s assets at $53 million.

Giacometti has raised $7.4 million for creditors, and the estate will receive another $1.25 million for its role as receiver for the now-defunct Bank of Honolulu, where Sia was once chairman and Nip was a director.

Another $1.25 million from the settlement will go to an Asian unit of Commerzbank AG, a major bank based in Germany.

Meanwhile, Giacometti said he is in talks to resolve the contempt order that is keeping Sia in prison. A local attorney for Sia declined comment yesterday….

See also: Molokai Ranch; Sukamto Sia

For more, GO TO > > > The Dillies at Dillingham

Donna Tanoue – Appointed by President William J. Clinton to head the Federal Deposit Insurance Corp (FDIC), which oversees the federal banking agency that monitors nearly 5,700 banks and insures $3 trillion in deposits. During her term from May 1998 to July 2001, she oversaw the transfer of Sukamto Sia’s insolvent Bank of Honolulu to Bank of the Orient.

November 7, 1997

Press Release

PRESIDENT CLINTON NOMINATES DONNA TANOUE AS CHAIR OF
FEDERAL DEPOSIT INSURANCE CORPORATION

WASHINGTON, D.C. — United States Senator Daniel K. Inouye is pleased that President Clinton has announced his intention to nominate Donna A. Tanoue as the Chairperson of the Federal Deposit Insurance Corporation (FDIC).

“I applaud and commend President Clinton on his nomination of Ms. Tanoue as the next Chair of the FDIC. I am most confident that Ms. Tanoue will provide excellent leadership, business and legal expertise to the FDIC. She will serve the people of this nation with integrity, diligence and distinction. This is indeed a proud day for Hawaii,” said Senator Inouye.

The FDIC is an independent agency which insures deposits in federally insured banks and thrift institutions, and resolves and liquidates failed banking institutions.

Ms. Tanoue is currently a partner with the law firm of Goodsill Anderson Quinn & Stifel, and over the last ten years, she has concentrated her law practice in the area of banking with an emphasis on bank regulatory matters. From 1983 to 1987, Ms. Tanoue was the Commissioner of Financial Institutions for the State of Hawaii. She was the chief regulator of State-chartered financial institutions during one of the most difficult periods in the history of the State’s financial services industry. . . .

She is married to Kirk W. Caldwell, a real estate attorney with the law firm of Ashford & Wriston….

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October 16, 2001

Ex-FDIC Chief Joins Bankoh Trustees

The Honolulu Advertiser

Donna Tanoue, former chairwoman of the Federal Deposit Insurance Corp., has been elected to the Bank of Hawaii board of directors.

Tanoue is working as a financial services consultant. She was appointed by President Clinton to head the FDIC from May 1998 to July 2001, overseeing the federal banking agency that monitors nearly 5,700 banks and insures $3 trillion in deposits….

It was under Tanoue’s leadership at the FDIC that the Bank of Hawaii signed a Memorandum of Understanding with banking regulators that increased federal oversight of the bank’s operations because of asset quality problems.

Tanoue said federal rules prohibit her from representing the bank before the agency she once headed.

“Now that I have left the agency, I operate under certain constraints. I am going to be very mindful of the ethical limitations which govern post-employment after you have left the FDIC,” Tanoue said yesterday.

During Tanoue’s tenure at the FDIC, she also instituted efforts to reduce the agency’s work force and budget, as well as create a diversity program within the FDIC.

During her tenure the agency’s staffing has declined 16.6 percent, to 6,500, and its budget is 6 percent smaller this year than it was last year.

Before joining the FDIC, Tanoue was a partner in the Hawaii law firm Goodsill Anderson Quinn & Stifel, where she specialized in banking, real estate finance and governmental affairs.

President Bush nominated Texas bank executive Donald E. Powell to succeed Tanoue….

Freeport-McMoRan Copper & Gold Inc. – Multinational mining company based in New Orleans.

From AFL-CIO Executive Pay Watch: . . .

Human rights monitors allege the company has assisted the Indonesian security forces in quelling anti-Freeport demonstrations by local indigenous groups.

“For years, Papuans saw the Indonesian military coming in Freeport helicopters, boats, trucks and Jeeps,” says an American missionary.

The Indonesian military has bombed, strafed and burned hundreds of villages in an effort to stop rebels— many armed only with bows and arrows— from the Free Papua Movement.

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From Corporate Predators: The Suharto–U.S. Corporate Connection . . .

The sudden exit of Suharto from the Indonesian presidency has cast the international spotlight on the crony capitalism that enabled Suharto and his family to amass a fortune estimated to be on the order of $40 billion.

Bribery and graft, sweetheart government contracts, government-protected monopolies and a host of other schemes made the Suharto family and a small coterie of close friends into billionaires.

Much less noted are the ways in which the Suharto regime facilitated super-profitmaking by foreign multinational corporations which eagerly accepted benefits and protections from Suharto’s brutal dictatorship.

Foreign multinational corporations benefitted from the twin pillars of the Suharto economic program: unsustainable extraction of Indonesia’s rich natural resources and unabashed exploitation of poor, unorganized Indonesian workers.

Consider the New Orleans-based Freeport McMoRan, which operates the world’s largest gold mine and third largest copper mine in Irian Jaya, the Indonesia side of the island of New Guinea. The company has ripped the top 500 feet off Puncuk Jaya Mountain, sifting through the dirt for copper and gold. After crushing the ore, mixing it with water and dousing the mix with chemicals to bring the metals to the surface, Freeport dumps the resultant waste rock – more than 100,000 tons a day— into mountain rivers.

Those rivers are the lifeblood of downstream communities of thousands of indigenous people. Environmentalists and the indigenous people themselves charge the rock waste has poisoned the water, killing fish and the riverside forest and making massive flood plains inhospitable to crops. Freeport denies the charges.

But the Amungme and Komoro peoples are angry enough to have organized ongoing protests.

The Indonesian military has met those protests with an iron fist, beating, torturing and killing many of the indigenous protesters.

Freeport denies any responsibility for the military’s human rights abuses of the protesters, and also denies charges that it has assisted the repression.

The Freeport-McMoRan controversy is typical of resource controversies in Indonesia, with local communities fighting against pillage of their resources and pollution of their lands and water by big national and multinational mining, oil and timber companies operating with the protection of the Indonesian military.

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From Third World Traveler, (courtesy of alamo-girl.com):

CLINTON’S Rogues Gallery . . . The world’s biggest gold mine is a lucrative investment for New Orleans-based Freeport-McMoRan Copper & Gold. The 5.75 million acre mining concession is worth an estimated $50-60 billion, and, last year alone, the company netted $400 million.

But for the Amungme, the indigenous people who live around the mine, and the Koperapoca Komoro, who live downstream from it, Freeport is nothing less than a nightmare….

The mining concession is now the most militarized district in all of Indonesia. The military presence surpasses even that of occupied East Timor, where invading Indonesian forces have been fighting a popular resistance for more that 21 years.

Since the first mine began operating in 1972, repression of the local population has grown to hideous proportions, leaving hundreds of people dead. In 1977, the Indonesian army killed 900 people in reprisals after local protesters sabotaged a Freeport pipeline….

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For more, GO TO > > > The Eagle Hooded; The Kissinger of Death

George Soros – From The Spotlight, by Martin Mann, May 11, 1998:

Elite Gobble Your Tax Dollars !

The House and the Clinton administration are eye-ball to eye-ball on billions for the IMF. The key question is, who benefits?….

The Clinton administration is pressing Congress to vote a hefty new handout — some $18 billion — to the International Monetary Fund (IMF) this year….

These stories have been well covered in the mainstream media. But what has been missing from the White House press releases — and mainstream media reports — is where the money really goes….

To make up for such lack of candor, this populist newspaper has launched its own inquiry to find out just who gets the dough rolled out for this conspiratorial one-world financial bureaucracy The answers turned out to be revealing. . . .

First rakeoff rights off the top go to Goldman Sachs, the giant Wall Street investment bank where Treasury Secretary Robert Rubin made his first billion in the anything goes 1980’s….

Goldman Sachs has been retained as a lavishly-paid financial adviser, underwriter and syndicator both by the governments of South Korea and Indonesia, as well as some of the largest banks and corporations in these sorely squeezed countries.…

BILLIONS INVOLVED…

Under current arrangements, stage-managed by Rubin and his faithful sidekick, Undersecretary of the Treasury Laurence Summers, Indonesia and South Korea are slated to share an eye-popping $100 billion in IMF bailout funds during the next 16 months or so….

“You’d think most of the loot would go to help ease some of the crushing dollar-denominated debt of these hard-hammered Asian economies — at least, that’s what Rubin and Larry Summers claim,” commented Fred Ackerman, a veteran Wall Street trader in international debentures…

Nothing like it, warned this veteran money manager. “In reality, the IMF’s bailout is being used mainly as loan insurance to enable Indonesia’s and Korea’s tapped-out state agencies and corporations to borrow even more in the global markets.”…

Goldman Sachs, chosen as the lead underwriter and syndicator of new bond issues for some of the largest Southeast Asian borrowers, is already collecting millions — and is expected to collect tens of millions — of dollars in fees and royalties for helping to pile more debt on the stumbling Indonesian and Korean economies….

“It’s like one of Mike Milken’s daisy chains, isn’t it?” asked Ackerman sarcastically, referring to the fraudulent syndicates set up in the ‘80’s by convicted swindler Michael “Junk King” Milken to rig the bond markets….

In much the same fashion, there is just a thinly veiled linkup between the official acts of Treasury Chief Rubin — known to insiders as the most powerful man in Washington as well as the main back-channel promoter of the IMF — and the huge profits skimmed by his once-and-future firm, Goldman Sachs, from such international bailouts, Wall Street sources say….

The second kickback from the IMF bailout goes to what even the Wall Street Journal calls “vulture capitalists” — that is, international financiers who pounce on distressed corporations, buy them out at knockdown prices, and then use “special connections” to make a killing on the deal.

This is what happened in Mexico in 1994-95, and it’s happening now in Southeast Asia, Wall Street sources say….

Henry Kissinger – Former U.S. Secretary of State; currently head of the commission to investigate the 9-11 terrorist attacks.

April 17, 2000

Kissinger Appointed Advisor to Indonesia
(not a satire)

By Terry J. Allen, In These Times (Chicago, U.S.)

Asked why he quit writing satirical songs, Tom Lehrer replied that after Henry Kissinger won the 1973 Nobel Peace Prize, there was nothing left to satirize. Lehrer may have underestimated Dr. K’s spirited sense of irony.

This February, the former U.S. secretary of state accepted Indonesian President Abdurrahman Wahid’s invitation to become an unpaid adviser to the Indonesian government. Kissinger accepted “out of friendship for the Indonesian people and the importance I attach to the Indonesian nation.”

Twenty-five years earlier, on December 6, 1975, Kissinger — along with President Gerald Ford — paid another friendly visit to Jakarta.

The next day, as Air Force One cleared Indonesian air space, President Suharto launched some 10,000 troops on a full-scale attack of East Timor. The goal was to conquer and annex the fledgling nation, which had just been granted independence by Portugal.

Kissinger now calls the atrocities that accompanied and followed the invasion — 200,000 dead — “regrettable.”

To this day, Kissinger maintains that the timing of his 1975 Jakarta visit was a mere coincidence and the United States had no role in the invasion. But a partially declassified State Department document of the December 6 meeting, minutes of a December 18 Washington meeting with his top advisers and other documents have been enough to convince most historians that the United States was complicit in planning, arming and supporting the invasion.

As a recent editorial in the Asian Times noted, “Kissinger is an accomplished liar in the service of his nation and his personal image.”

Not to mention his bank account. The strength of his fellowship for the Indonesian people is at least rivaled by that of his financial ties to the world’s largest gold mine, located in the remote province of Irian Jaya (now called West Papua).

Kissinger sits on the board of New Orleans-based Freeport McMoRan Gold and Copper, the majority shareholder in the massive mining operation, which also happens to be Indonesia’s biggest taxpayer.

Friends and family of Suharto, who was ousted in 1998, still hold much of the minority stake in the mine….

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For more, GO TO >>> Of Vampires and Daisies; The Eagle Hooded: The 9-11 Coverup; The Kissinger of Death

James Riady – Indonesian billionaire who was a key figure in the Democratic campaign finance scandals.

January 12, 2001

Billionaire agrees to record plea bargain
for Clinton donations

MSNBC (AP) – In a record-setting plea bargain, Indonesian billionaire James Riady agreed to pay an $8.6 million fine and plead guilty to using foreign corporate funds to back Bill Clinton’s 1992 presidential campaign, the Justice Dept announced.

RIADY, A KEY FIGURE in the Democratic campaign finance scandal, is set to plead guilty to a felony charge of conspiring to defraud the United States, prosecutors said. . . .

Riady pledged $1 million in 1992 to support the then-Arkansas governor’s campaign, the Justice Dept said Thursday.

Riady used John Huang, an officer of his Lippo Group, to reimburse foreign contributors to Clinton and other Democrats, according to 70 pages of government documents filed with the plea bargain in U.S. District Court.

Foreign campaign contributions are illegal under U.S. law. The money was funneled through Hong Kong bank accounts and Lippo entities overseas, the government papers said.

Huang, who pleaded guilty earlier to campaign finance violations, has been cooperating with the government since Aug, 1999. Many of the allegations appeared to be based on his information.

Riady also has been talking. The government said he has met a half-dozen times with U.S. prosecutors and FBI agents to outline the information he could provide as part of a plea bargain.

Asst U.S. Attorney Dan O’Brien, who negotiated the deal, said the lack of an extradition treaty was the biggest hurdle, because Riady, an Indonesian citizen, could not have been forced to surrender if he had been indicted.

In addition, LippoBank California, a California state-chartered bank affiliated with Lippo Group, agreed to plead guilty to 86 misdemeanor counts charging that its agents, Riady and Huang, made illegal foreign campaign contributions from 1988 through 1994.

Government documents said that the Lippo Group hoped to influence American foreign policy for its own advantage.

AMONG ITS GOALS WAS TO GAIN MOST FAVORED NATION TRADE STATUS FOR CHINA; NORMALIZATION OF U.S. RELATIONS WITH VIETNAM; OPEN TRADE POLICIES WITH INDONESIA; COMMUNITY REINVESTMENT ACT EXEMPTIONS FOR LIPPO BANK AND A REPEAL OF THE GLASS-STEAGALL ACT WHICH LIMITED BUSINESS OPPORTUNITIES FOR LIPPO BANK….

Government papers also said Lippo wished to gain access, meetings and time with elected officials and top government officials.

An FBI summary released last year said Huang alleged that Riady had told Clinton, while he was Arkansas governor, during a limousine ride that he wanted to raise $1 million for his campaign. . . .

Last April, Clinton told federal investigators that he did not have “a specific recollection of what the conversation was, or this fact of the car ride.” He said he only remembered seeing Riady “sometime in ‘92 after I became the nominee,” and that Riady pledged to help his campaign….

[Apparently William J. Clinton DIDN’T FORGET, however, to deliver to the Lippo Group what they paid for ! ! ! ]

Riady is one of 26 people and two corporations so far charged by the Justice Dept’s campaign finance task force since it was established four years ago. …

Ray’s office has prosecuted former Justice official and Clinton friend, Webster Hubbell, and has investigated whether payments to him, including $100,000 from Lippo Group, after he resigned, were designed to keep him from testifying against Clinton or his wife. . . .

Riady also agreed to perform 400 hours of community service and forfeit to the U.S. Treasury any refunds that might be issued to him by any political campaign committees because of Thursday’s announcement. . . .

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March 14, 2001

Riady Denies $1 Million Offer
to Clinton in 1992 Race

CNN.com (AP) – The Indonesian billionaire who has agreed to plead guilty to making illegal donations to Bill Clinton’s 1992 presidential campaign denied having a limousine conversation with the candidate about raising $1 million for the race, court records show.

James Riady “told Clinton that he would be supportive” of Clinton’s campaign, meaning that he would provide financial support, but never mentioned $1 million during a conversation the two had in Clinton’s limousine after a campaign event Aug 1992, according to a summary of information Riady has provided to federal prosecutors as part of a plea agreement.

“Riady did not suggest a one million dollar figure to Clinton at any time,” said the summary, contained in papers filed Monday by federal prosecutors in U.S. District Court in Los Angeles, where he is to be sentenced this coming Monday. . . .

[Catbird translation from Clintonese: It might have been around a million, but not exactly a million, and I did not have sex with Riady.]

Riady has agreed to pay a record $8.6 million criminal fine and plead guilty to using corporate funds from his foreign Lippo Group to reimburse contributors to Clinton’s presidential campaign, the Justice Dept said on Jan 11, nine days before Clinton left office.

Foreign campaign contributions are illegal under U.S. law.

The 1992 limousine ride was the focus of intense scrutiny by congressional investigators looking into campaign fund-raising during Clinton’s 1992 and 1996 campaigns.

Riady also told investigators that no one at the Clinton White House urged him to hire presidential friend Webster Hubbell, who pleaded guilty to a felony in the Whitewater investigation, the summary said.

Critics have suggested that payments to Hubbell from Clinton supporters were part of an effort to keep Hubbell from cooperating with the probe.

Riady’s account of the limousine talk contradicts what fund-raiser John Huang has told the FBI.

Huang, who worked for the Riady family before getting a job in the Clinton administration and becoming a Democratic Party fund-raiser, said Riady told Clinton during the ride that he wanted to raise $1 million, according to an FBI summary. Huang said Riady later told him that Clinton acted surprised when Riady said he would raise the money.

Riady denied saying this in interviews with federal prosecutors … He said he told Huang after the ride that he wanted to contribute money to Clinton, then Arkansas governor, and contended that Huang suggested the $1 million figure.

Huang was sentenced to probation after pleading guilty to conspiring to violate federal fund-raising laws.

Clinton told federal investigators that he did not specifically remember the ride or his conversation with Riady. Clinton said he only remembered seeing Riady “sometime in ‘92 after I became the nominee,” and that Riady pledged to help his campaign.

[Suggested $100 Question for Who Wants to Be a Millionaire: Who is telling the TRUTH — (1) Riady (2) Huang (3) Clinton (4) Adolph Hitler]

Riady was accused of pledging $1 million in 1992 to support Clinton’s campaign for president. Government documents filed with the plea bargain say that Riady used Huang to reimburse foreign contributors to Clinton and other Democrats.

The money was funneled through Hong Kong bank accounts and Lippo entities overseas, the government papers said….

Riady has met six times with U.S. prosecutors to provide information, and his agreement requires him to continue to do so, federal prosecutors said.

His cooperation has improved investigators’ understanding of campaign finance violations, but probably won’t lead to more convictions, prosecutors said in sentencing recommendations released Monday.

John Waihee – former Governor of Hawaii and big FOB (Friend of Bill).

Honolulu Star Bulletin, 10/2/85:

Waihee: $10,000 Rewald
Down Payment Returned

The administrator of Ronald Rewald’s bankrupt company testified yesterday that Rewald loaned Lt. Gov. John Waihee’s law firm $10,000 in January 1983. Waihee, however, said … that the money was a down payment on a land deal and was later returned.

Thomas Hayes said the check was made out to Waihee but deposited in the law firm of Waihee, Manuia, Yap, Pablo and Hoe. Hayes said Waihee was “embarrassed” about the transaction after Rewald’s company collapsed and paid the money back in Nov 1983.

Waihee said the $10,000 wasn’t a loan, but a deposit on some Big Island land Waihee owned that Rewald wanted to buy. He said he does not know why the check was marked as a loan. …

WAIHEE DID receive $4,500 during the 1982 lieutenant governor campaign from Rewald and his companies.

Waihee said he was unaware of the large amount of political donations from Rewald until the collapse of Bishop, Baldwin, Rewald, Dillingham and Wong.

Waihee met with Rewald on three occasions before and after the 1982 election because of his interest in international trade. Rewald at the time was preparing a report on flight capital from Hong Kong. . . .

For more, GO TO > > > Flying High In Hawaii

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A Fiscal Policy Report Card on America’s Governors – 1994, by The Cato Institute:

Hawaii: John Waihee, Democrat – Took Office 12/86 – Grade F.

Waihee has helped to create and prolong the recession in Hawaii by his spendthrift budget policies. In his first five years, he allowed the state budget to mushroom from $3.2 billion to $5.3 billion- an average annual increase of 10 percent. That amounts to about $1,200 per family every year….

Despite … “pro-growth” spending initiatives, the unemployment rate in Hawaii has increased by 2 percentage points since 1989, and property values are in a depression. The spending path charted under Waihee is clearly unsustainable- both fiscally and economically.

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From GreaterThings by Greg Wongham: FBI Investigates Hawaii Democratic Party. According to news reports, Nora and Eugene Lum were dispatched by the Hawaii Democratic Party to meet with Bill Clinton. The purpose of the visit was to seek the Presidential candidate’s help in pulling the plug on an FBI investigation of Hawaii’s (D) Governor John Waihee. The Lums admitted to FBI investigators looking into allegations that arose during the “Chinagate” investigation that after Clinton was elected, Webster Hubbell (3^rd man in the Justice Dept during the early days of the Clinton administration) pulled the plug.

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From Honolulu Star-Bulletin, 10/28/96, by Ian Y. Lind: Isle Woman Part of Campaign Probe – Former resident Nora Lum figures in congressional investigation into ‘92 finances:

Following the 1992 elections, Brown was appointed secretary of commerce and named Huang and Yee to key positions in the department….

For more, GO TO > > > Predators of Paradise; The Puna Connection

Lippo Group – Indonesian conglomerate owned principally by the Riady family.

From Betrayal – How the Clinton Administration Undermined American Security, by Bill Gertz:

Who was the biggest contributor to the Clinton-Gore ticket in 1992? Not a corporation, not a labor union, not a Hollywood mogul, but Indonesian businessman James Riady and his wife, who gave $450,000 to elect Bill Clinton. . . . During the final weeks of the campaign, the Riady family, its associates, and executives at Riady companies gave an additional $600,000 to the DNC and Democratic state parties….

The patriarch of the business empire is Mochtar Riady … Of his three sons, James was a permanent resident of the United States, Stephen was educated here, and Andrew worked in California….

All, however, have fled the United States. Any Riady employee with detailed knowledge of the family’s activities in the United Stated has likewise stolen away in the night. Even James Riady’s secretary has vanished. Only John Huang, the family’s former U.S. operative, remains in the United States — and he has pleaded the Fifth Amendment….

The Riady empire, centered on its Lippo Group, is, as one financial analysis in Jakarta describes it, “a carefully balanced house of cards.”

Newsweek has noted, “Moving cash around the globe in tangled webs of transactions has always been the Riady way,” and the Asian Wall Street Journal accuses the Riadys of “ramping” — buying large numbers of shares in their own companies in order to support prices….

In 1977, Mochtar Riady tried to buy the National Bank of Georgia. He failed, but one of the brokers in the deal was Jackson Stephens of Little Rock, Arkansas, who tried to interest a disappointed Riady in joining Stephens, Inc., one of America’s largest private investment banks … and one with which the Riadys would have an extended relationship, as we will see. Mochtar Riady agreed, and his son James, then aged twenty, arrived to intern at Stephens, Inc...

Through Jackson Stephens, James Riady met a rising politician, Arkansas Attorney General Bill Clinton. Thus began a friendship that has lasted twenty years, and has spread a web of intrigue, financial corruption, and foreign influence into American government.* * *

For more, GO TO > > > The Donkey Nests

Mochtar Riady – A billionaire senior executive for the Riady family’s Indonesian enterprise, Lippo Group.

Riady was an invited guest at Clinton’s inauguration and his son, James was on the “economic summit” convened after Clinton’s election.

Riady has close ties with the military junta that has killed hundreds of thousands in East Timor.

When William Clinton visited Indonesia in November 1994, he met with Mochtar Riady and John Huang. A point at issue here is not only the illegal foreign contributions to a presidential election, but also the close economic and social ties to an enterprise vying to market East Timor goods in America by a group that uses genocide and slave labor to compete in the global market.

The Bishop Estate reportedly has tenuous connections to the Riadys through the Panin Group, Sino Finance, and Xiamen International Bank.

For more, GO TO > > > British Petroleum: Buzzards in the Pipelines; Vultures up to their beaks in Tesoro Petroleum; Vultures on the Hill and Knowlton

Molokai Ranch – Located on the Hawaiian island of Molokai, this ranch occupies about one-third of the island.

From: FaKToR

Date: April 28, 2000

Subject: FAKTOR -025: Daftar kekayaan Soeharto dkk di Hawaii & benua Amerika

HAWAII (U.S.)

In March 1996, a Southeast Asian investment syndicate, Camerlin, acquired 20% shares of the New Zealand-based investment company, Brierly Investments (BIL), for NZ$ 800 juta. Members of the Camerlin syndicate included the Salim Group from Indonesia (in which Sudwikatmono is one of the four founders, apart from the Salim patriarch, Liem Sioe Liong), Hong Leong Industries and the Renong Group from Malaysia, and Haw Par Brothers International ND Sembawang and the Singapore branch of Hon Leong Industries.

In 1989, BIL had acquired the Molokai Ranch, which owns a third of the land on the island of Molokai. This acquisition was done through a Hong Kong-based subsidiary of BIL, called Industrial Equity (Pacific) Ltd.

1. Molokai Ranch Group member companies:

Molokai Ranch, Limited: W G Haight, B A Hancox, J W Mozley Jr, M J O’Connor (R)

Cooke Land Company, Inc.

Molokai Meat Company, Limited

Molokai Ranch Land company, Limited

Molokai Ranch Outfitters, Inc.

Waiola O Molokai, Inc.

Wai Mau Corporation

MRL Food Services Inc.

MRL Water Reclamation, Inc.: W G Haight, J W Mozley Jr.

MRL Management Limited: W G Haight

Molokai Ranch Foundation: S. Goodenow, W G Haight (R), J W Mozley Jr, Ottina Haight…

2. IEP/Hawaii Acquisition Corp.:

D M Chown, G R Knoke, A R Meehan (R), M C K Moy

3. Industrial Equity (Pacific) Limited:

This is the parent company of Molokai Ranch Ltd, which, on behalf of BIL, acquired the ranch.

Address: 603A, China Building, 29 Queens Road, Central, Hong Kong.

Directors: D M Chown, M B Horton (R), G R Knoke, S J Temple (R)…

From http://groups.yahoo.com/group/mimbarbebas/message/7831

For more, GO TO > > > Paradise Paved

Norman Mineta – U.S. Secretary of Transportation.

Web posted January 8, 2001:

BUSH’S TERRIBLE TRANSPORTATION PICK

Editor, The Chronicle

Is President-elect George W. Bush swapping integrity for diversity or caving in to the extreme left wing of the Democrat Party?

If the congressional watchdog group Judicial Watch is right, it may be both.

Democrat Norman Mineta, the pick by “Dubya” for Transportation secretary, was implicated in the Clinton administration Commerce Department trade missions scandal. It involved the selling of airline seats for campaign contributions on so-called trade junkets. Sound familiar?

That’s not all. Mr. Mineta, who was Bill Clinton’s pick for Commerce secretary, took part in a 1994 trade mission to Indonesia which involved John Huang and others implicated in the Chinagate scandal. Also involved were Charlie Trie, James Riady and Mark Grobmyer, according to information uncovered in the course of a Freedom of Information Act lawsuit brought by Judicial Watch.

Add all this to the fact that Mr. Clinton reportedly sent Mr. Mineta to placate the family of Wen Ho Lee, the nuclear engineer and purported spy at Los Alamos Laboratory, in order to generate votes for Democrats from the Asian-American community. This occurred while Lee was being investigated by the feds for criminal espionage.

After eight long years of silliness, scandals and corruption during President Clinton’s watch in the White House, one would have hoped that George W. Bush would have a little more political acumen than to have nominated a crook like Norman Mineta to a Cabinet post….

– Frank Murphy, Aiken

* * *

For more, GO TO > > > Hail to the Chief; The Eagle Awakes; Year of the Dragon

Panin Group – Panin was founded by Indonesian businessman Mu’min Ali Gunawan, a brother-in-law of Indonesian banking tycoon Moshtar Riady.

Riady, who heads the Lippo Group, is at the center of the campaign finance scandal plaguing the Clinton administration.

October 29, 1997

Bishop, partners alter Chinese bank plan

By Rick Daysog, The Honolulu Star-Bulletin

The turmoil in Hong Kong’s stock market may hamper plans by Bishop Estate and its partners to take a mainland Chinese bank public. . . . With the benchmark Hang Seng index losing more than a fifth of its value during the past weeks, analysts said that a proposal to list shares of Xiamen International Bank on the Hong Kong Stock Exchange could be put on hold.

The development underscores Bishop Estate’s growing exposure to global economic trends. It also calls attention to the $10 billion trust’s high-risk, high-reward investment strategy. . . . Bishop Estate, the state’s largest private landholder, owns nearly 5 percent of Xiamen, which last year applied with the People’s Bank of China to list its shares on the Hong Kong Stock Exchange.

Henry Peters, a Bishop Estate trustee and a member of Xiamen’s board of directors, conceded that the volatile Hong Kong market may delay Xiamen’s initial public offering. But he said the bank’s partners are committed to taking it public, which would greatly enhance the estate’s investment. . . .

Critics say the trust should not be investing in exotic companies such as Xiamen. They argue that the nonprofit foundation — which finances Kamehameha Schools — should avoid high-risk ventures in emerging markets such as China. . . .

The list of Xiamen International Bank’s investors reads like a who’s who of Wall Street and Pacific Rim finance. They include former U.S. Treasury Secretary William Simon, Manila-based Asian Development Bank and Long-Term Credit Bank of Japan Ltd….

The largest shareholder is Min Xin Holdings Ltd., formerly the Panin Group, which owns 36.75 percent of the bank. An affiliated company, Panin Bank, formed Xiamen in 1985.

Panin was founded by Indonesian businessman Mu’min Ali Gunawan, a brother-in-law of Indonesian banking tycoon Moshtar Riady…

Riady, who heads the Lippo Group, is at the center of the campaign finance scandal plaguing the Clinton administration….

Peters said he was unaware of the relationship between Panin Bank and the Riady family. …but investments of Simon, Panin and the estate have been linked for years. The estate was a big shareholder in First Interstate Bank of Hawaii Inc. when Simon sold the local bank to First Hawaiian Inc. in 1991.

Simon, in turn acquired much of his stake in First Interstate in the mid-1980s from Panin Bank executives….

Peters was a director of the local affiliate Panin North America Inc. in 1983 when he was a legislator, according to filings with the state Ethics Commission. …

For more, GO TO > > > Dirty Money, Dirty Politics and Bishop Estate; William Simon Says…

Renton Nip – Honolulu attorney with the firm of Verner, Liipfert, Bernhard, McPherson & Hand.

From their website:

Areas of Practice

Renton Nip has practiced in the areas of commercial litigation, public and municipal finance, international finance, international and domestic real estate transactions, and business immigration. He has represented a wide range of overseas and domestic owners and developers in condominium and office project development in Honolulu, as well as in various other phases of project development. He has represented clients in projects in China, Hong Kong and Singapore. In addition, Mr. Nip has represented various underwriters and issuers in connection with the issuance of tax-exempt bonds and clients in private financings.

Other Professional Experience

Prior to joining Verner Liipfert, Mr. Nip was a partner with Foley Machara Nip & Chang from 1982 to 1995. He served a per diem judge in District Court, State of Hawaii, from 1982 to 1986 . . . Mr. Nip has also served as law clerk to Chief Justice William S. Richardson, Hawaii Supreme Court, from 1975 to 1976…

Board Memberships and Affiliations

Director, Bank of Honolulu; Director, Chinese Chamber of Commerce of Hawaii; President, Chinese Chamber of Commerce of Hawaii

Community Activities and Service

Chairman, Land Use Commission, State of Hawaii 1988-1992; Commissioner, Land Use Commission, State of Hawaii 1987-1995; Chairman, Hawaii Employment Relations Board 1981-1986; President, Legal Aid Society of Hawaii 1978-1980; Director, Native Hawaiian Legal Corp 1980-1986; Director, Hawaii State Bar Association 1982-1984 …

* * *

February 1, 2003

Suit moves ahead against Sia lawyers

Honolulu Star-Bulletin Staff

A lawsuit that accuses a prominent local attorney and a high-powered national law firm of conspiring to help imprisoned businessman Sukamto Sia conceal assets from creditors is moving forward.

A hearing is scheduled for Feb. 10 to decide whether the suit will be moved to U.S. District Court from U.S. Bankruptcy Court.

The suit, filed last year by the trustee in Sia’s pending bankruptcy case, accuses Honolulu lawyer Renton Nip and law firm Verner Liipfert Bernhard McPherson and Hand of aiding and abetting Sia in hiding millions of dollars in assets. Sia is serving a federal prison sentence through September 2004 after pleading guilty to bankruptcy fraud and wire fraud in 2001.

Nip and Verner Liipfert deny wrongdoing and allege the lawsuit was not clear enough for them to respond to, but U.S. Bankruptcy Judge Lloyd King ruled Thursday that the lawsuit was fairly drafted.

* * *

March 14, 2003

Lawyers cast complicity blame
on Sia’s brother

The attorneys are accused of helping
the bankrupt Sia hide his assets

By Tim Ruel, Honolulu Star-Bulletin

The lawyers accused of complicity in the bankruptcy fraud of imprisoned businessman Sukamto Sia are asking that any blame fall on one of Sia’s younger brothers, a former fugitive who is believed to live in Singapore.

Honolulu attorney Renton Nip and the law firm formerly known as Verner Liipfert Bernhard McPherson & Hand say they have done nothing wrong, but if they lose in court, they want the blame and costs to fall on Sumitro Sukamto.

Sumitro was once charged in Sia’s federal criminal case in U.S. District Court in Honolulu, though Sumitro never appeared in court.

“He was a fugitive from day one, and he never made an appearance,” said Craig Nakamura, one of the federal attorneys who prosecuted Sia.

The federal counts against Sumitro were dropped when Sia reached an agreement with prosecutors in 2001 to plead guilty to bankruptcy fraud and wire fraud, for which Sia received a reduced sentence.

Sia, 44, is in prison in Lompoc, Calif., and is scheduled for release in September 2004.

Last year, the bankruptcy trustee appointed to investigate Sia’s assets, Guido Giacometti, sued Nip, Verner Liipfert, Sia and Sumitro in a nine-count lawsuit, alleging they had conspired to hide Sia’s assets. The suit alleges that Nip and Verner Liipfert received thousand-dollar payments from Sia without court approval. The lawsuit is pending in U.S. Bankruptcy Court.

Sia, an Indonesian who was once the chairman of the now-defunct Bank of Honolulu, filed bankruptcy in Honolulu in November 1998, claiming he had $9.3 million in assets and nearly $300 million in debts.

Giacometti has estimated Sia’s actual assets at $79.6 million.

Nip and Verner Liipfert represented Sia during his bankruptcy case, and both have denied the allegations that they helped Sia hide assets. Sia has also denied the new allegations. Sumitro has not responded.

In pleadings filed separately in U.S. Bankruptcy Court last week, Nip and Verner Liipfert said all blame should fall on Sumitro. Verner Liipfert is seeking a court order to require Sumitro to protect the law firm from damages.

Warren Price III, attorney for Verner Liipfert, said in an interview that Nip and Verner Liipfert are relying solely on the information in the lawsuit against Sumitro, because they have no way of contacting Sumitro. “We don’t know where this person is,” Price said.

Nip is named in seven of the nine counts in Giacometti’s lawsuit. Verner Liipfert is named in five counts. Sumitro is named in four counts.

The Verner Liipfert firm, known in Hawaii for its lobbying on behalf of the former Bishop Estate trustees, has been acquired and is now known as Piper Rudnick.

Nip, a former state land use commissioner, was once of counsel to Verner Liipfert. Nip is now with the law firm Waihee & Nip, along with former Gov. John Waihee, who also used to be with Verner Liipfert.

< < < FLASHBACK < < <

August, 1991

Chidiac’s Lawyers Take a Number In
Growing Queue of Creditors

In the June and July issues of 1991, Environment Hawai`i considered plans for and feasibility of the super-luxury Hawaiian Riviera Resort proposed for Ka`u by one Charles Chidiac. There have been further developments in the case and additional information obtained with regard to Chidiac.

Here is a summary:

Poor Lawyers

As was disclosed in the July Environment Hawai`i, Chidiac has received loans totaling more than $45 million from a network of foreign banks, with the collateral for each loan being the land he owns in Ka’u. This is in addition to almost $40 million that he owes his former partners in the resort venture since purchasing most of their stake in the land in August 1990. Again, security for the promissory notes he gave his partners was the land.

That same real estate is now further burdened with a lien placed against it by several attorneys who aided Chidiac in his successful efforts to win Land Use Commission approval of his resort. (At its meeting May 14, the commission allowed Chidiac’s land to be placed in the urban district.)

Rather than pay legal fees to George K. Lindsey, Jr., and to the law firm of Moon, O’Connor, Tam & Yuen, Chidiac has given them a mortgage.

Bill Yuen, a partner in the law firm, is a former LUC chairman. He did not argue Chidiac’s case to the commission directly, but he did appear at commission hearings and aided in the presentation of Chidiac’s case. Many people who followed the proceedings closely believe Yuen’s presence at hearings and behind-the-scenes lobbying helped win over LUC Chairman Renton Nip.

The amount of money owed by Chidiac to Lindsey and to Yuen’s law firm is not given in the document filed with the Bureau of Conveyances. The mortgage does state, however, that the lawyers’ claims are subordinate to previous claims totaling roughly $90 million. Chidiac signed the mortgage January 23, 1991. It was not filed with the Bureau of Conveyances until June 24, 1991.

To the Court

Two of the interveners in the LUC hearings who are opposed to the resort have appealed the commissions decision in state circuit court in Hilo. The Native Hawaiian Legal Corporation has appealed on behalf of Pa’a Pono Miloli’i, while Glen Winterbottom has appealed on his own behalf.

Among other issues, the NHLC appeal raises the point that state law requires the commission to issue a final decision and order within 120 days of the end of hearings in any given case. The decision and order issued by the commission on June 4, 1991, does not satisfy this requirement, NHLC attorneys state. Far from it being a final document, it is contingent upon Chidiac’s Palace Development Corporation providing additional information – information, the attorneys note, that should have been furnished prior to the commissions decision.

Meanwhile, in London

Following publication of the July issue, a reader has submitted further information on Chidiac’s activities abroad, as reported by the Financial Times of London. In its editions of February 20, 1990, the newspaper reported that a Tory Minister of parliament, one John Browne, was found guilty by a House of Commons committee of having failed to disclose his business interests – specifically, his business interests in a firm controlled by Chidiac. Quoting from the Times:

“An all-party committee of MPs said that action should be taken against Mr. Browne for failing to register his interest ‘In a firm of Lebanese middlemen controlled by Mr. Charles Chidiac, whilst lobbying Ministers and officials on their behalf and on the behalf of their own clients.’ His ‘undisclosed pecuniary interest’ in carrying out this lobbying was particularly serious, the committee said.”

Browne was also judged to have erred in not disclosing an $88,000 payment from Saudi Arabia, as well as having failed to disclose his relationship with the Saudi Arabian Monetary Agency, Saudi Arabia’s central bank.

Environment Hawaii

* * *

September 15, 1998

It’s Not The First Time
for Takemoto

Bishop Estate budget chief was investigated
for financial abuses in 1993

By Ian Lind, Honolulu Star Bulletin

Bishop Estate budget chief Yukio Takemoto is no stranger to charges of political favoritism and cronyism. Last week, the state attorney general’s office accused Takemoto of a scheme to improperly wipe out an $18,690 dept by then-Sen. Milton Holt, using payments from four nonbid contractors with the estate…

Takemoto, appointed state budget director by former Gov. John Waihee, spent months at the center of a 1993 legislative probe into state purchasing abuses and dealings of the state Employee Retirement System.

The hearings, directed by the late Sen. Richard Matsuura, did not result in any formal charges against Takemoto. But they publicly aired details of several situations in which Takemoto appeared to direct nonbid contracts to friends, or improperly accepted gifts or favors from companies seeking business with the state….

Takemoto resigned under pressure at the end of 1993, and joined Bishop Estate months later….

According to information disclosed during the 1993 hearings, the Waihee administration awarded nearly $13 million in nonbid contracts to Data House even though he had no computer expertise, and either ignored or did not seek out the advice of computer experts on his staff.

Throughout the hearings, Takemoto denied his 25-year friendship with Arita played any major role in the contract decisions….

Soon after his appointment as budget chief, Takemoto stopped putting multimillion-dollar state bond sales out for competitive bid and substituted a nonbid process. The new negotiated deals gave him total control over who would sell state bonds and what fees they would collect….

With Takemoto in charge … two attorneys with close ties to the Democratic Party and Waihee were named as local bond counsel on dozens of bond issues. The two captured all legal work not handled by large mainland firms specializing in bond deals during Takemoto’s tenure….

Honolulu attorney Renton L.K. Nip advised the state or bond underwriters on more than 30 bond series issued by the state between 1990 and 1993….

In 1989, Nip assisted Takemoto in soliciting funds for Waihee’s re-election campaign.

Nip, then-Land Use Commission chairman, sent letters to a number of companies seeking to do business with the state.

“Mr. Yukio Takemoto of the Dept of Budget & Finance has asked our assistance in distributing tickets to you for the governor’s fundraiser …,” the letter said.

Computab, a computer services firm, was about to sign a $700,000 contract to provide computer equipment to Takemoto’s department when it received the letter and 20 fundraiser tickets, according to a complaint filed by Desmond Byrne, a former Computab officer.

Bryne called the letter “a very unsubtle attempt to lean on the company” and, because of the pending contract, “Computab had no option but to give.” . . .

* * *

Honolulu Star-Bulletin, 9/6/00, by Tim Ruel: Former Isle Banker Sia First Ordered Freed, then Held Pending Appeal –

A federal judge said today that Asian businessman Sukamto Sia should be released on bail pending an Oct 31 trial, but agreed to keep him behind bars pending an appeal by the U.S. Attorney General’s office….

While Federal Magistrate Barry Kurren called Sia a possible flight risk, Kurren did not think the U.S. government had showed enough evidence that he would leave the United States.

Kurren placed several conditions on Sia’s release, including $150,000 in cash and two Hawaii properties with equity worth a total of $760,000, all posted by friends.

Stockbroker Al Souza, friend of Sia for 15 years, offered his Waialeale home, worth $320,000 in remaining equity. Eric Yanagihara, formerly Sia’s Hawaii asset manager and former senior vice president of Bank of Hawaii, offered remaining equity in his Waialae Ridge home, worth $440,000.

Also, attorney Jon Miho will post a cashier’s check worth $100,000 and Sia lawyer Renton Nip will post $50,000.

Entertainer Danny Keleikini offered testimony in support of Sia’s release.

Federal authorities downplayed the significance of the collateral, arguing that Sia could leave the country, then later make it ujp to his friends for what they would lose.

“This person is an extraordinary flight risk,” said Poirier during the hearing. . . .

Sia, a former director and major shareholder in Bank of Honolulu, filed for bankruptcy on Nov. 8, 1998 listing $296.4 million in debts and $9.3 million in assets.

The bankruptcy was filed a month after his arrest in Las Vegas on charges of bouncing more than $13 million in checks at several casinos. Sia has blamed his financial woes on a downturn in the Asian economy….

* * *

See also: Suharto

For more, GO TO > > > Year of the Dragon; British Petroleum: Buzzards in the Pipeline; Vultures up to their neck in Tesoro Petroleum

See on the web: Dead Men Tell No Tales; The Confidential Commerce Files; Ron Brown and the Balkans; Tripping With the Secretary; Questions Linger about Ron Brown

Suharto – Ousted ruler of Indonesia.

From Corp Watch, 5/29/98:

Repression, Inc. – The Assault on Human Rights

Statement of Allan Nairn Before House Briefing on the IMF and Indonesia:

For 33 years a Suharto/Armed Forces (ABRI) regime built on “the underlying threat of force” … made it possible for foreign companies to grow rich on Indonesia’s vast resources and labor.

But now that unjust arrangement is facing a historic challenge from below. Popular protest has ousted Suharto and though the ABRI police state remains, its leaders fear that they have not seen the last of Indonesia’s new freedom movement.

The question for foreign firms and powers is: on which side do they stand?…

The current policy of the US Executive Branch and of the IMF is to continue the old system in a new guise – with one key exception. While reluctant to back freedom for workers and dissidents, they aggressively push it for foreign investors.

The US continues to back ABRI with weapons, spare parts and ammunition as well as intelligence support ….

But they and the IMF do want to make a change in the old regime: to move it from so-called crony capitalism dominated by the Suharto family, to a corporate version dominated by the global markets, by multinational firms and the strictures of the World Trade Organization.

There is some irony in this, since the roster of de facto Suharto cronies includes many of the largest multinationals in the world.

The companies in business with the Suharto family include Morgan Stanley, Lucent Technologies, General Dynamics, Motorola, Mitsubishi, Dupont, BP, Hughes Siemens, Hyatt, Hundai, Edison Mission Energy, General Electric, Westinghouse, NEC, and Rolls Royce, to name a few, along with Merrill Lynch which is in business with Suharto’s notorious son-in-law General Prabowo.

Freeport McMoRan and Textron are in business with the ABRI (Freeport recently built a $35 million garrison for ABRI troops in West Papua, and Textron licenses the manufacture of Bell Helicopters for ABRI by the state aerospace firm, IPTN, controlled for years by current President Habible).

Caltex, Shell, Phillips Petroleum, USX, and Mobile have illegally drilled for oil in the Timor Gap.

ATT and Texaco have lobbied behind the scenes for the regime….

* * *

From wsws.org, June 5, 1998, by Mike Head:

Growing Demands for the Seizure
of Suharto’s Empire

Suharto and his family accumulated extraordinary riches while millions of Indonesian workers and peasants were subjected to grinding poverty at the hands of the military dictatorship and its international backers. Earlier this year, the US business magazine Fortune assessed the family’s total personal wealth at $US40 billion…

Formally barred from having direct business interests himself, Suharto entrusted his commercial affairs to his late wife Tien (nicknamed “Madam 10 percent” because of the cuts she obtained from government contracts), his six children, half-brother Probosutedjo and cousin Sudwikatmono.

Together, they created a sprawling array of businesses, including toll roads, satellite communications, broadcasting, vehicle plants, electricity projects, water supply utilities, domestic airlines, plantations, taxi services and trading ventures. The also formed joint ventures with the armed forces and giant ethnic Chinese groups such as Salim and Barito Pacific.

Various members of the family own luxurious mansions, ranches and other properties around the globe, including in Britain, Bermuda, the Cayman Islands, Los Angeles, Hawaii, Germany, Singapore and Australia.

Their lifestyles were a world apart from the landless peasants and slum dwellers as well as the industrial workers, paid the equivalent of less that $US3 dollars a day … The economic meltdown and the demands of the International Monetary Fund mean that unemployment, homelessness and hunger confront millions in both the cities and the countryside. . . .

Interlocking Interests

Popular sentiment seemed to be summed up by one student … Referring to three of Suharto’s children, he told one reporter:

“There should be a public trial of Tommy, Tutukt and Bambang. They’ve got rich and we got poor and now we Indonesians have to face crisis and pay for their loot.”…

There is no prospect that the Habibie-led regime or any alternative capitalist government will do anything else but safeguard the key business interests tied up in the Suharto network, whatever cosmetic measures may be taken against individual members of the Suharto family.

In the first place, all of the leading figures in the Habibie cabinet and the military, including Habibie, Wiranto and economics minister Ginandjar Kartasasmita, have personal fortunes closely interlocked with those of the Suharto group….

Whether under Suharto or his predecessor Sukarno, the ruling elite has rested on the same underlying system of state-sponsored and military-related financial and business dealings….

Moreover, Suharto’s military junta was installed with the backing and direct assistance of the United States and other imperialist powers. For years it served their requirements for ready access to Indonesia’s vast natural wealth and reserves of cheap labour….

* * *

THE STRUGGLE FOR DEMOCRATIC
RIGHTS IN ASIA PACIFIC

Muslim Brotherhood, Or Pure Business Interests?

by Dr George J. Aditjondro*

As you already know by now, the most popular reason which Jakarta has used to oppose any frank debate about the plight of the East Timor people in the ASEAN member countries is ASEAN solidarity. Then, in the specific case of the Philippines, Manila has always been reminded by the Suharto regime and its supporters of the Philippines’ moral debt, utang na loob, to Indonesia.

Representing the largest Muslim country in the world, Jakarta has mediated between Manila and the Moro National Liberation Front (MNLF), to solve the Moro problem in a peaceful way.

This diplomatic favour of Indonesia is supposedly based on Indonesia’s sense of Muslim brotherhood towards the Bangsa Moro.

However, as far as the Suharto regime is concerned, this Muslim brotherhood rhetoric is simply a myth.

Yes, a myth. Or, in Karl Mannheim’s term, an ideology, to cover up for the more mundane, material interests. The real reason for Jakarta’s role in helping to settle the Moro problem is not necessarily Suharto’s love for fellow Muslims in the South.

The real reason is the ASEAN-ization of businesses owned by the Jakarta oligarchy, pioneered by Suharto’s closest and oldest business partner, Liem Sioe Liong, through the Salim Group.

Suharto’s half-brother, Sudwikatmono, is also a major shareowner in this group, while two of Suharto’s children, Siti Hardiyanti Rukmana and Sigit Harjojudanto, own thirty two per cent shares in the group’s Bank Central Asia (BCA). Following the track of his older brother and sister, Bambang Trihatmojo, Suharto’s second son, has also formed many joint ventures with the Salim Group, especially in the tourism and petro-chemical industries. Salim patriarch Liem Sioe Liong himself is closely connected with other Chinese tycoons in South East Asia and Hong Kong.

After accumulating their capital from the Salim Group and from their father’s patronage, the Suharto children themselves have ventured into the brave new world of ASEAN with their own business conglomerates. These ASEAN-ized Indonesian businesses have now spread their wings to the Philippines, from Manila to Cebu, and also probably to Davao and General Santos.

Of all these Suharto family businesses, the Citra Lamtorogung Group controlled by Suharto’s eldest sibling, Siti Hardiyanti Rukmana, or Sister Tutut as she is popularly called, is the most ASEAN-ized. . . .

For the last two years, she has been involved in building the 45-km Metro Manila Skyway Project through her Citra Consortium, with a total investment of US$475 million.

This mega-project will involve a 12.5-km elevated skyway above the South Luzon Expressway (SLE) and a 14.5-km surface road portion of the SLE from Alabang to Nichols.

Tutut’s Citra Consortium has received exclusive authorisation from the Philippine National Construction Company (PNCC) to undertake the construction, financing and management of the toll road projects, through a 30-year built-operate-and transfer (BOT) contract with the Philippine government.

The share composition and construction schedule of this mega-project is as follows. PNCC will own twenty per cent of the shares of the Skyway project, a private Filipino entrepreneur, Cezar Qulambao ten per cent, while the Citra consortium will own the majority share of fifty five per cent.

The remaining fifteen per cent of shares will be owned by a US finance company, American International Group (AIG), through its subsidiary, AIG Asian Infrastructure Fund, for providing seventy six per cent of the project’s capital investment….

This mega-project is Tutut’s first venture in the Philippines, which was in its preparation stage while Suharto was putting pressure on Fidel Ramos to prohibit the first Asia Pacific Conference on East Timor (APCET), two years ago….

In October 1995, the construction of a US$2.2 billion oil refinery at Nonoc Island, south of Manila, had started. This mega project, which will yield a maximum of 120,000 barrels of refined oil products per day, is a joint venture between PT Elnusa and the Philippine’s Kaibigan Holdings.

PT Elnusa itself is a joint venture between the Indonesian state oil company, Pertamina, and Tutut’s Citra Lamtorogung Persada….

So, for the next 25 years, after the Metro Manila Skyway project is finished, all Filipino/a motorists who drive along these toll roads will contribute to the wealth of the Suharto family. During that time, the petrol used by the cars which will drive along the Skyway project may come from the Nonoc Island refinery. Which means that regardless of whether motorists choose to drive along the skyway or not, they will still contribute to the Suharto family’s wealth….

But the largest single project resulting from the EAGA agreement is a US$120 million tourist resort and casino to be constructed on Samal island, just off the coast of Davao.

Financed by the Malaysian conglomerate Ekran Berhad, the resort will boast 1,700 rooms, demanding an increase in international links with Davao. Ekran Berhad is also the main company involved in the construction of the notorious Bakun dam, which is going to flood the homes of thousands of Dayak people in Sarawak.

How will the Suharto oligarchy benefit from this new growth area?

The answer is: in numerous ways. Sempati Airlines, owned by two of Suharto’s sons, Tommy and Sigit Harjojudanto, three charities headed by Suharto, and an Army-owned foundation already flies regularly between Jakarta and Manado, Taipeh, Christmas Island, and Rangoon. So, Sempati could easily flex its political muscle, to obtain the right to fly to Davao and Bandar Seri Begawan as well.

In the mean time, Sigit Harjojudanto has recently acquired a fifteen per cent share in another Army- owned airline, Mandala Airlines, and bought two former Lufthansa jets and eight Boeing 737 jets. . . .

Tourism, is also not a new field for the Suharto clan. All the Suharto siblings, their uncle Sudwikatmono and Suharto’s favorite grandson Ari Haryo Wibowo, dominate Bali’s tourism industry through the luxury hotels, golf courses, travel agencies, and airlines they own. . . .

Tutut herself already co-owns the five-starred Nusa Dua Beach Hotel in Bali with the young, rich and flamboyant Sultan of Brunei – Darussalam, Hassanal Bolkiah….

Apart from that, if Jakarta and Kuala Lumpur really wishes to respect the cultural rights of the Bangsa Moro, why do they support the development of the large tourist resort with its casino on Samal Island, just off the coast of Davao? The Jakarta and Kuala Lumpur rulers certainly know that gambling is strictly forbidden by Islam.

Or is this huge casino on Samal Island just another case of closing casinos in front of Muslim eyes in the capital city, while reopening an even larger casino behind closed doors in a remote place, where the Muslim children of the ruling elite can lavishly spend their people’s money?

This has been the case of the Copacabana casino in Jakarta, which has been re-opened in a much larger form on Christmas Island by its former owner, Atang Latief (father-in-law of Sukamto Sia). It is a favourite gambling place of Tommy Suharto whose Sempati Airlines has the exclusive right to fly between Jakarta and the casino island.

This hypocritical policy towards oppressed Muslim groups has also been shown by Jakarta towards the Palestinian people. On one hand, Jakarta does not recognise Israel, and has strongly supported the Palestinian people’s right to self-determination. During his recent visit to Jordan, President Suharto again reiterated Indonesia’s support for an independent Palestinian state.

On the other hand, Indonesia’s military and business elites have maintained a close relation with the military and business elites in Tel Aviv, including Israel’s notorious secret service agency, Mossad.

Various Jakarta-Tel Aviv military links have now been exposed in Western and Indonesian sources. Jakarta under Suharto, had allowed a Mossad agent to operate in Jakarta under a British passport.

This has been admitted by former security chief General Soemitro in his biography. He had assigned three generals Sutopo Yuwono, Kharis Suhud, and Nicklany to deal with the Mossad agents. He justified the cooperation with Mossad, because Mossad and the British MI-6 secret service were anti-Communist and much more effective than the US CIA.

Apart from cooperating with Mossad, the Indonesian army special force Kopassus, which is currently commanded by Suharto’s son-in-law, Mayor General Prabowo Subianto, has been equipped with Israeli Uzi guns.

These Uzi machine guns were reportedly used in the massacre of hundreds of Muslim activists in Tanjung Priok, Jakarta, on September 12, 1984, as well as in the assassination of the West Papuan artist and freedom fighter, Arnold Ap, on April 26, 1984.

The Indonesian army special force has not been reluctant in exposing their admiration for the Israeli army. Two years ago, during their 42nd anniversary, the Indonesian army special force distributed their publication for the media, which included a brief history of Kopassus and the translation of a long chapter from a book extolling the virtues of a typical Israeli Army commander.

Meanwhile, the Indonesian air force has also not hesitated from using second- hand US Skyhawk fighters, bought from Israel, which may have been used in the massacre of Palestinian refugees and Hizbullah freedom fighters in the Bekaa Valley in South Lebanon.

Recently, in the military operation to release European and Indonesian hostages taken by an OPM faction in the highlands of West Papua, the Indonesian military was not ashamed to accept the assistance of Israeli anti-guerilla devices again. Israeli-made Mazlat Scout pilotless drones, that had been supplied to Singapore three years ago, were used to locate the hostages. The drones, developed in the 1980s to track Palestinian and Hizbullah guerilla movement in the heavily defended Bekaa Valley, were brought in after the mediation of the International Committee of the Red Cross failed.

And although there are officially no diplomatic ties between Jakarta and Tel Aviv, a number of hi-tech Israeli companies have had business deals with a number of well-known Indonesian companies. The powerful Salim and Tamara Groups and the state-owned telecommunications company PT Telkom are among those which have forged business ties with Israel, albeit indirectly….

A luta continue em todos frentes!

Dr George Aditjondro is an Indonesian pro-East Timor activist and researcher of the Suharto Oligarchy. He is presently a lecturer in the Department of Sociology and Anthropology at the University of Newcastle, NSW, Australia.

See in Part III: Timor

Sukamto Sia – Indonesian multi-millionaire businessman (before declaring bankruptcy). Sia, formerly known as Sukarman Sukamto, also owned a majority share of Bank of Honolulu, The Executive Center building, and the land purchased by the State of Hawaii for Hawaii Convention Center.

~ ~ ~

From: FaKToR

Date: April 28, 2000

Subject: FAKTOR -025: Daftar kekayaan Soeharto dkk di Hawaii & benua Amerika

HAWAII (U.S.)….

Sukamto Sia is an Indonesian born Singaporean citizen, whom in 1995-1996 created shock waves on the Singapore stock exchange by acquiring the shares of Parkway Holdings and then selling it to the Malaysian taipan, Vincent Tan (Berjaya Group).

Incidentally, Vincent Tan’s entry into Parkway Holdings was closely followed by a son of Malaysian PM, Mirzan Mahathir, together with a son of Soeharto, Bambang Trihatmodjo and his business partner, Johannes Kotjo. So, it is not impossible that some hanky panky had been going on between Sukamto and & Bambang Trihatmodjo.

After selling his Parkway Holdings shares on the Singapore stock exchange, Sukamto bought shares of another Singapore-listed company, namely Amcol Holdings. Incidentally again, Sudwikatmono (Suharto’s cousin) and one of his business partners, Henry Pribadi, as well as the patriarch of the large Sinar Mas Group, Eka Tjipta Widjaja, also tried to raid the shares of Amcol. This furthers the suspicion that the Soeharto family were trying to acquire Amcol Holdings to further establish their new business bastion in Singapore, aided by their old business partners from the Salim and Sinar Mas Groups.

Meanwhile, in Hawaii, the Sukamto Holdings Corp. was established in 1981, and was active in the property and banking sectors in Honolulu. Sukamto Sia, who had obtained a Bachelor’s degree from the Chaminade University in Honolulu, had bought 76% shares of the Bank of Honolulu.

Sukamto Sia also had other businesses in Honolulu, namely with the GTE Hawaiian Telephone Co. Inc. Through a subsidiary of the Transmarco Group in Singapore, where Sukamto owns 50,5% shares (No. 2 after another Indonesia businessman, the “clove cigarette king”, Putera Sampurna, who owns 66% shares), he tried to expand into telecommunications in the ASEAN region and India.

In late 1995, Transasia Telecom formed a joint venture with Northern Telecom Singapore (Nortel) and GTE Hawaiian Telephone Co. to win a tender to build a cellular telephone project for 200,000 links worth US$ 200 million in Southern Philippines.

This Transasia, Nortel & GTE Hawaiian coalition also planned to tackle telecom projects in India, Pakistan, Sri Lanka and in other ASEAN countries.

At this moment, however, Sukamto Sia, who was previously known as Sukarman Sukamto, is in deep trouble in Honolulu. With a US$ 296.4 million debt to some international banks, casinos and other creditors in Hawaii, his shares at the Bank of Honolulu has been confiscated by the court. Also his US$ 90,000 account in the Singapore branch of Bank of America and two luxurious cars (Rolls Royce “Silver Spur” dan Mercedes Benz) in Honolulu were going to be confiscated by the Honolulu court.

Addresses of the main players of the Sukamto Group:

Sumitro Sukamto: 1088 Bishop Street, Honolulu, HI

Sukarman Sukamto (became Sia Sukamto in 1998): 1088 Bishop Street (but in the 1986 DCCA filing is 2549 Tantalus Drive, Honolulu 96813)

Clement Chan: 2499 Kapiolani Blvd. #1410, Honolulu 96826

Colby Jones: 1717 Mott-Smith Drive, Honolulu 96822

Arick Yanagihara: 5336 Puahia Place, Honolulu 96821

Indriati Latief (former wife of Sukamto Sia): 2549 Tantalus Dr., Honolulu 96813

From http://groups.yahoo.com/group/mimbarbebas/message/7831

* * *

Some Connections:

The land under The Executive Center is owned by Bishop Estate. The insurance broker for Sia was Marsh & McLennan. A prime lender on The Executive Centre was Citibank. Sia’s accounting firm was PricewaterhouseCoopers.

~ o ~

March 1, 2002

Prosecutors support revoking Sia’s bail

By Tim Ruel, Honolulu Star-Bulletin

Troubled businessman Sukamto Sia, who is to be sentenced on federal charges in Honolulu this month, should have his bail revoked immediately because he was arrested in Los Angeles for slapping his fiancee, according to the U.S. Attorney’s Office.

Sia lied to Los Angeles police by saying he had never been arrested before, and that the electronic monitoring device on his arm was a watch, according to a document filed yesterday in U.S. District Court. The U.S. Attorney’s Office alleges that a gun found at Sia’s residence, registered to his fiancee, was technically in his possession, which would also violate the terms of his release.

Sia’s attorney Bill McCorriston said he will contest the move to revoke Sia’s $1.5 million bail at a hearing scheduled for Wednesday in U.S. District Court. Sia was arrested on a misdemeanor count of battery and booked on Feb. 12. But the Los Angeles City Attorney’s Office didn’t press charges and there is no evidence of battery, McCorriston said.

The City Attorney’s Office based its decision on a police report of the incident, according to a letter to the U.S. Attorney’s Office in Honolulu from Lawrence Webster, supervising deputy city attorney in Los Angeles.

The police report is not the whole story, federal prosecutors said in court documents supporting revocation of Sia’s bail. Assistant U.S. Attorneys Craig Nakamura and Mark Recktenwald are seeking to question the police officers in court. Prosecutors also want to play a tape recording of a 911 call they say was made by Sia’s fiancee, Kelly Randall, on the night of the arrest.

At 1:14 a.m., police got a call from Sia’s estate in Bel Air from a woman who was distressed, but the call was abruptly cut off, according to court documents. When the police arrived at Sia’s home, Sia said Randall made the call after they had an argument. Police found Randall in a bedroom, under the bed covers, crying. She said nothing was wrong.

Upon further questioning, Randall said Sia had grabbed her and slapped her, and that’s when she called 911. Randall told police she did not want to press charges.

Sia, 43, told police he grabbed Randall to calm her. Police then told Sia he was under arrest. When informed of that, Randall said she did not want him arrested, and that she had lied earlier when she had said he hit her.

Nearby, police found Kleenex stained with blood, which is believed to have been from a wound Sia sustained when striking Randall, prosecutors said.

Police also found another woman, intoxicated, who was wandering around the home. Randall told police the other woman had come home with them after a night out.

Randall won’t press charges and is not leaving Sia, her attorney, Brook Hart, told the Star-Bulletin. “The case is completely without merit,” Hart said. He said he couldn’t recall a mention of blood in the police report.

“The two of them had a disagreement. There was probably some harsh words,” he said.

Sia and Randall have been together for roughly a decade, and they are under a lot of stress because Sia is about to be sentenced on charges of bankruptcy fraud and wire fraud, Hart said.

Randall picked up the phone in a moment of anger and dialed 911, he said.

“Nothing. That’s all there is to it,” he said. Randall would testify to that in court, Hart said.

Last year, Randall was charged by prosecutors as being Sia’s accomplice in his federal criminal case, but the charges against her were dropped as part of a deal Sia cut to reduce his sentence by pleading guilty.

* * *

March 4, 2002

Aston says Honolulu’s downtown hotel will remain
open under new ownership

Pacific Business News

Aston Hotels & Resorts says Honolulu’s all-suite Executive Centre Hotel will continue to function despite a selloff of units by mortgage holder Citibank. …

New York-based Citibank … last month told its local realtor EPA Concepts to begin selling units on the 31st through 41st floor, one floor at a time. Earlier it sold 275 units for $18 million….

Citibank acquired the 41-story building almost a year ago from the bankruptcy estate of Sukamto Sia.

Sia, now 43, was once the high-flying head Bank of Honolulu. His financial empire collapsed in 1998 when he was arrested for allegedly writing more than $13 million in bad checks for Las Vegas gambling debts. Sia filed for Chapter 11 claiming $9 million in assets and nearly $300 million in debts only to go later into Chapter 7 liquidation.

Last year Sia, who had once owned the land on which the Hawaii Convention Center was built, was charged with defrauding creditors by hiding assets. Sia left his millionaire’s residence in the Waikiki Landmark condominium high-rise and moved to Singapore.

* * *

March 8, 2002

Sia loses bail hearing,
ordered to detention

The bankrupt businessman faces sentencing March 21

By Tim Ruel, Honolulu Star- Bulletin

U.S. District Judge David Ezra today placed bankrupt businessman Sukamto Sia into immediate custody, saying that by lying to Los Angeles police Sia posed an immediate flight risk.

At the estate, Sia’s fiancee Kelly Randall told officers that Sia had slapped her during an argument, police said.

In his ruling, Ezra concluded that Sia lied when he told police that he had not been arrested before, when in fact Sia was arrested two years ago by the FBI.

“Mr. Sia plain and simple lied,” Ezra said.

Sia also lied to officers when he claimed that an electronic monitoring bracelet was a watch, Ezra ruled.

What’s more, Ezra said, in his experience, people who are a flight risk will flee immediately upon their arrest or just before sentencing. Sia is set to be sentenced by Ezra on March 21.

“I have serious concerns about her credibility as a witness in this matter,” Ezra said.

Randall either lied to the police that night or lied to the court because she had, in fact, told police that Sia had slapped her, even though she later recanted the statement, Ezra said.

Honolulu attorney Jon Miho said after the ruling that it was “overkill,” since Sia faces sentencing shortly.

Sia posed no risk of flight and has always attended his court appearances, Miho said.

“Electronic monitoring in this case failed completely,” Recktenwald said.

In response, Sia’s attorney David Chesnoff pointed out that Sia has never attempted to escape his sentence. “The man is here,” he said.

Los Angeles police should have known that the bracelet on Sia’s arm looked nothing like a watch, Chesnoff said.

Chesnoff wanted Ezra to allow Sia to remain in Hawaii until he could surrender for sentencing.

* * *

March 21, 2002

Jones asks judge to be lenient with Sia

By Jim Dooley, Advertiser Staff Writer

University of Hawai’i football coach June Jones has asked a federal judge for leniency on behalf of financier Sukamto Sia, suggesting that Sia could give “instructional lectures” at UH as part of his rehabilitation instead of serving prison time for bank fraud.

In a Feb. 13 letter to U.S. District Court Judge David Ezra, Jones called Sia “one of the most wonderful persons I have associated myself with since returning to Hawai’i” and said he has known Sia for about a year, becoming “very good friends” over that time.

When he heard about Sia’s legal troubles, “it made me feel sick to my stomach,” Jones wrote.

Sia will appear before Ezra today for sentencing on bankruptcy and wire fraud convictions. He faces up to 40 months in federal prison and fines of $1.5 million. Earlier this month, his bail was revoked after his involvement in a domestic disturbance in Los Angeles on Feb. 13.

On Tuesday, U.S. Bankruptcy Court Judge Lloyd King found Sia in contempt of court for repeatedly failing to produce financial records to his creditors.

King threatened to notify Ezra of the contempt ruling, then said he may order Sia jailed after he finishes serving whatever sentence Ezra hands down today in the criminal case.

Jones declined to discuss the letter he wrote on Sia’s behalf, saying it was “a private letter to the judge.”

Asked if the bail revocation or contempt ruling have changed his attitude toward Sia, Jones said, “No, nothing’s changed.” Jones said he didn’t wish to elaborate. “The letter speaks for itself,” he said.

Written on UH stationery, Jones’ letter referred to Sia as “SS,” and said Sia “could be a great asset to the University of Hawai’i by giving instructional lectures to our students. I make this suggestion as part of a rehabilitation sentence, in lieu of custody time.”

Jones also noted that Sia has been involved helping young business people.

“In the past, he has held seminars and roundtable business discussions, devoting many hours of his time in open forum to help them and guide them toward achieving success in life,” he said.

Numerous other friends and associates of Sia also wrote letters of support to Ezra.

Sia, 41, is a developer, financier and former owner of the Bank of Honolulu, which was seized by federal regulators in October 2000. As part of a plea agreement in the criminal case, Sia admitted defrauding the bank by obtaining illegal loans that went to companies he controlled.

He also admitted improperly cashing two state of Hawai’i tax refund checks worth $757,000 and using some of the proceeds to gamble in Las Vegas and to buy his girlfriend, Kelly Randall, a pair of diamond earrings worth $325,000.

More than a dozen other criminal counts against Sia were dropped in return for his guilty plea.

Sia’s lawyers have argued to Ezra that Sia’s financial problems were caused in part by a severe gambling addiction that led to losses of tens of millions of dollars at casinos around the world.

He was arrested by Las Vegas authorities in 1998 on charges he wrote bad checks to cover some $8 million in gambling debts. Those charges were later dropped after he agreed to repay the money.

The domestic disturbance incident last month occurred at a mansion in Bel Air, Calif., that Sia shares with Randall. Randall at one time was also charged in the federal court case, but prosecutors agreed to drop those charges in return for Sia’s guilty plea.

Police said Randall initially told them Sia slapped her three or four times but she later said the accusation was a lie.

Ezra, in revoking Sia’s bail, said it wasn’t because of the domestic battery allegations but because Sia lied to police officers when he told them that he’d never been arrested before and that an electronic monitoring device attached to his wrist was a watch.

* * *

March 22, 2002

Sia sentenced to 3 years

By Frank Cho, Advertiser Staff Writer

Former Honolulu financier Sukamto Sia was sentenced today to three years in federal prison and ordered to pay $3.1 million in restitution for bankruptcy fraud.

Sia, a real estate developer and chairman of the now-defunct Bank of Honolulu, had pleaded guilty late last year to bankruptcy and wire fraud charges as part of an agreement with federal prosecutors to dismiss 18 other felony charges and end nearly three years of legal wrangling.

“The evidence is this is an arrogant man who has no respect for the law,” said Craig Nakamura, assistant U.S. attorney. “What the evidence shows is he is just a common criminal.”

Sia, 43, could have faced up to 40 months in a federal prison, restitution, and fines of up to $1.5 million.

Sia also was given five years of supervised release after serving his term. He has 10 days to appeal the sentencing. William McCorriston, Sia’s Honolulu attorney, said his client is “devastated” and hasn’t decided whether to appeal the sentence.

“What he did was not small. What he did was huge,” Judge David Ezra said in announcing the sentence.

Ezra called Sia’s crimes “substantial” and “pervasive.” “We have here a situation where Mr. Sia and his cohorts used a U.S. bank as their private piggy bank,” Ezra said.

In a statement to the court after sentencing Sia said he was sorry. “I spent my life trying to be a productive person,” Sia said. “I made bad choices. It was a low point in my life. … I know I did wrong, but I am not a public enemy.”

Sia said he plans to resume his business career once released.

Vincent Rakestraw, an Ohio-based attorney with the Immigration and Naturalization Service, said Sia, who is not a U.S. citizen, could face deportation upon his release from federal prison.

“It’s not clear yet whether Mr. Sia will be deported,” Rakestraw said. He said a review of the case likely will begin while Sia is incarcerated.

In return for Sia’s guilty plea, the U.S. attorney’s office had agreed to drop 18 other counts, including charges of bankruptcy fraud and money laundering against Sia, his girlfriend, Kelly Randall, and Sia’s brother, Sumitro.

Sia’s other brother, Suwardi, is still under indictment and believed to be out of the country.

Under the court-ordered $3.1 million in restitution, Sia will receive credit for repayment of about $2 million. He still has to pay about $1.1 million. About $25,000 of that will go to the bankruptcy court trustee, the rest will go to the Federal Deposit Insurance Corp., which seized Sia’s Bank of Honolulu in 2000.

Sia filed for bankruptcy protection Nov. 6, 1998, after he was arrested in Las Vegas on bad check charges. He resigned as chairman of the Bank of Honolulu. The Las Vegas charges were later dismissed.

In the bankruptcy filing, Sia listed nearly $300 million in debts and just $9 million in assets, mostly in real estate. He was arrested again in Honolulu Aug. 30 on charges of bankruptcy fraud and had been living in Los Angeles under supervised release as he undergoes medical treatment for a thyroid problem.

As part of his plea agreement, Sia admitted he participated in a scheme to defraud the failed Bank of Honolulu by obtaining illegal loans that went to Sia or companies he controlled.

The Bank of Honolulu was seized by the Federal Deposit Insurance Corp. in October 2000.…

< < < FLASHBACKS < < <

October 15, 1993

Key Senator Remains Silent in Bribe Probe

Honolulu Star-Bulletin

The federal and state investigation into whether developer Sukarman Sukamto offered a bribe to Senate President James Aki hinges on what Sen. Bert Kobayashi said at a meeting Oct. 1 in Aki’s office….

Of those who were present at the Oct. 1 meeting, only Senator Rey Graulty and Senator Russell Blair said they clearly recalled Kobayashi making what they described as an allegation involving bribery.

Graulty said that Kobayashi told the group that Sukamto asked Aki to relinquish the Senate presidency to Senate Vice President Milton Holt, “and if he did so, Sukamto would do some development project on Aki family land in Nanakuli to make it worth his while.

Aki and Sukamto, who owns the Waikiki-area site that the state wants to buy for a convention center, deny they were involved in a bribery scheme….

Graulty said Kobayashi told the group that Sukamto was backing Holt because the real estate tycoon saw Holt as a political force who would be around for another six or seven years and eventually be named a trustee of the Bishop Estate, Hawaii’s largest private landowner….

* * *

October 30, 1993

Sukamto Deals a Roll of the Dice

Honolulu Star-Bulletin

He gambled away more than $4.5 million at Caesars Palace in Las Vegas and yet the young Indonesian developer would still come back for another game of chance.

The high-stakes wagers, which took place between 1988 and 1989, offer a rare glimpse into the personality of Sukarman Sukamto, owner of the Aloha Motors site designated by the Legislature for the state convention center.

The 35-year-old deal-maker, now under investigation by federal and state authorities for allegedly bribing state Senate President James Aki, is a gambler in both life and in business.

Sukamto denied charges that he asked Aki to step aside as Senate president in exchange for developing the lawmaker’s family property….

* * *

August 9, 1996

The ‘Rape’ of Amcol

Asia Week

Less that three years ago, Amcol Holdings was one of Singapore’s hottest stocks. Today, the electronics and property group is again the talk of the town– thanks to a boardroom struggle, accusations of wrongdoing and the conglomerate’s near-collapse. According to Price Waterhhouse accountants, Amcol, recently valued at $818 million, may now be worthless … Say investigators: “The situation is critical.”…

What went wrong? The troubles first came to light in 1994 when boss and chief dealmaker Kang Hwi Wah, a flamboyant self-made magnate, was jailed for eight months and fined for taking an $800,000 bribe from a Japanese partner in 1990….

After his release, the tycoon still owned about 24% of Amcol, the biggest stake. In early 1995 he sold 17.3% to a firm belonging to Indonesian businessman Henry Pribadi, head of Jakarta’s Napan Group and a close associate of both multi-billionaire Liem Sioe Liong and Sudwikatmono, President Suharto’s half-brother.

Last August, Pribadi, whose Indonesian interests span real estate, banking, and petrochemicals, became Amcol’s managing director, with Sudwikatmono as chairman….

But in January this year, Kang sold a 6% stake to a company run by local businessman Lee Howe Yong and Indonesian-born executive Sukamto Sia, who heads Transmarco, a Singapore-listed telecommunications company. The two have since raised their joint stake to just over 14%.

Sia is said to be allied either with Kang, whose conviction bars him from company boards, or with Bambang Trihatmodjo, Suharto’s second son, whose partner Tommy Winarta earlier bought Amcol stock. . . .

A picture is emerging of gross mismanagement, incredibly bad deals, and dismal accounting. An electronics subsidiary sold goods at a loss to Funai, which resold them to another Amcol firm at a 12% profit. . . .

In Indonesia, as associate firm could not adequately document a supposed investment in satellite broadcaster Indostar, for which Amcol advanced $8.5 million. The associate lent a similar amount interest-free to two Indonesians, including Peter Gontha, a top man at Indostar’s main backer, Bambang’s Bimantara group.

Also cited: payments of $300,000 each to Amcol executive Loyd Lochra and two others, made by its partner in questionable racetrack, casino and property projects in Mauritius.

Singapore Finance Minister Richard Hu has said the government will not rescue Amcol. Still battling for control, Pribadi and Sia are discussing with judicial managers how to revive the group once favored by institutional investors and considered safe enough for retirement money….

An insider alleges: “Whoever was on the throne raped the company.”

However the saga plays out– criminal charges may be laid– there is already one clear loser: the minority shareholders….

For more, GO TO >>> The Eagle Hooded

* * *

September 6, 1996

Singapore Spree

Asia Week

Two weeks ago, the judicial managers of ailing property and electronics group Amcol announced that they had accepted a rescue package proposed by Sinar Mas, Indonesia’s third biggest conglomerate. Days later, Kretek (Clove) cigarette magnate Putera Sampoerna launched a bid to take over telecommunications equipment supplier Transmarco, whose biggest shareholder at the time was Sukamto Sia, another Indonesian businessman. Sukamto also holds a major chunk of Amcol stock….

But last year, the Stock Exchange of Singapore censured Sukamto and fellow Indonesian Johannes Kotjo for breaching bourse rules….

Kotjo was censured for his remarks to Bloomberg News Service on the possible takeover of United Pulp by a consortium of which he was a member; Sukamto for failing to disclose a pending lawsuit against him in Hawaii. . ..

* * *

November 10, 1998

Sia Resigns as Board Chairman
of Bank of Honolulu

Honolulu Star-Bulletin

. . . Sia, 39, who formerly went under the name Sukarman Sukamto, last week resigned as board chairman of the Bank of Honolulu following his arrest in Las Vegas last month. He was charged with passing $8 million in insufficient checks to cover gambling debts at two casinos. Late last week, he filed for bankruptcy protection in Honolulu, listing $161 million in bank loan debts and $27 million in gambling debts.

Sia … listed assets of between $10 million and $50 million in the Chapter 11 filing in U.S. Bankruptcy Court. According to the filing, Sia owes bank loans of $111 million in Singapore, $37 million in Indonesia, $10.5 million in Hong Kong and $3 million in Bangkok….

Sia also owes a total of $18 million to four Las Vegas casinos — The Rio Hotel, Caesars Palace, the Mirage Hotel and the Las Vegas Hilton — as well as $9.6 million to casinos in London, Paris and Melbourne, Australia…

Sia is free on $200,000 bail after pleading innocent to the Las Vegas charges. He is accused of passing five insufficient-fund checks totaling $6 million at the Rio Casino and two checks totaling $2 million at Caesars….

* * *

April 21, 1999

Sia’s Bankruptcy Estate
may be liquidated

Honolulu Star-Bulletin

Noted for his gold watches, fine wines, and fancy cars, Indonesian businessman Sukamto Sia may soon be the subject of a fire sale….

A court-appointed trustee has asked that Sia’s Chapter 11 bankruptcy case — aimed at restructuring his debts — be converted to a Chapter 7 liquidation….

In a court filing last week, (Guido) Giacometti said he is investigating Sia’s 76% stock ownership in Bank of Honolulu, which… was pledged to two Singapore banks as collateral on loans. The banks are CommerzBank, owed $40 million, and Societe Generale, owed $22.9 million. . . . At a meeting with creditors in December, Sia blamed his woes on the Asian economic crisis…

Formerly know as Sukarman Sukamto, the 39-year old Sia showed up at the meeting with two bodyguards….

* * *

September 23, 1999

Complaint says Sia hiding
millions in fake firm

Honolulu Star-Bulletin

A U.S. Bankruptcy Court trustee has accused Indonesian businessman Sukamto Sia of hiding millions of dollars in a fake company in the British Virgin Islands to dodge his debts….

Trustee Guido Giacometti [a former top executive for Kamehameha Schools/Bishop Estate] filed a complaint in federal bankruptcy court yesterday alleging that Sia funneled $16 million in mortgage interests in his downtown high-rise, Executive Center [which sits on property leased from Kamehameha Schools/Bishop Estate], to a nonexistent company called A-B-C Pacific Ltd. in August 1998 …

According to yesterday’s filing, A-B-C Pacific was an insolvent corporation in Tortola, British Virgin Islands, controlled by “insiders” associated with Sia’s numerous business interests. . . .

According to yesterday’s complaint, two “loan purchase agreements” were executed last year in which A-B-C would buy Sia’s mortgage interests for $16 million.

The filing says the purchase agreements “were merely a ruse to make it appear as though the transaction were a bona fide purchase for consideration when in fact it was not.”…

* * *

February 16, 2000

Clinton’s Rogues Gallery:

(abwehr, 2/16/00) . . . Jim Guy Tucker sold his previous cable company to this guy:

PRESS RELEASE 4/27/99: “….Marc Nathanson, chairman of Falcon Cable TV, was sworn in on March 8, 1999 as Chairman of US International Broadcasting Agency by Vice President Al Gore in the Roosevelt Room at the White House, as his wife Jane looks on. The US International Broadcasting Agency oversees Voice of America, Radio Free Europe/Radio Liberty, Radio Free Asia and Radio/TV Multipolar….”

Multipolar, that name rings a bell. Sukamto Sia, I believe. Son-in-law of a major Indonesian business family. Involved in bribing the Hawaiian speaker of the House or Senate president a couple of years ago. Also was Tomy Winarta’s partner in a company called Transmarco.

Winarta came up last week in reference to the Clinton fundraising scandal. Believe it was his money that reimbursed Ching Hai.

There was a bit of a scandal as well over a satellite deal involving these players. Called Indostar, it was supposed to provide TVRO signals to Indonesia. What was cute was a minority-owned business (CTA) in the US got the contract to build it, though they had no satellite experience but the president of CTA made a large DNC donation. After getting the contract they, of course, sold it to Orbital I believe it was. . . .

Sia has come upon hard times, though. Last time I looked he had been arrested in Las Vegas after running up, and I kid you not, some $25 million plus in gaming debts at casinos there.

Bounced a check for something like $6 million! . . .

* * *

March 22, 2000

Kamehameha Schools begins
search for trustees

Star-Bulletin staff

Wanted: Five trustees to run a $6 billion charitable organization set up to educate native Hawaiian children.

Must have experience running a large corporation, managing assets of a multimillion-dollar company or setting policies for a large financial or educational institution.

Background in law, education or corporate administration helpful. Pay: $97,500 or less.

You might see a classified ad similar to this soon in your daily newspaper now that the seven-member blue-ribbon committee named by Probate Judge Kevin Chang is beginning its campaign to name permanent replacement trustees.

The panel, dubbed the Trustee Screening Committee, has scheduled a news conference at the Kamehameha Schools campus this afternoon to provide details of what could be a six-month search for a new board.

Committee members are Winona Beamer, Hawaiian educator; Michael Rawlins, Kamehameha Schools graduate; Colbert Matsumoto, former estate master; Melody MacKenzie, attorney; Kenneth Brown, local business executive and former legislator; Roy Benham, Kamehameha Schools Alumni Association Oahu region president; and Kelvin Taketa, Hawaii Community Foundation executive.

The panel recently hired a consulting firm, Inkinen & Associates, to help them publicize the openings and screen potential candidates.

The committee plans to look at candidates with a business background with a reputation for integrity and a good standing in the local community.

The panel will then come up with a list of seven candidates from which a state probate judge will select the five replacement trustees.

The initial board members will serve two- to five-year terms and each could petition the probate court for another five-year term. There are no age limits, and candidates are not required to have Hawaiian blood.

Trustees will be paid a maximum of $97,500 a year, although the board chairman’s pay limit will be $120,000.

The search for new permanent trustees comes nearly a year after the former board members were removed by Probate Judge Kevin Chang after the Internal Revenue Service threatened to revoke the trust’s tax-exempt status.

Since then, the trust has been managed by five temporary trustees: retired Adm. Robert Kihune; Constance Lau, American Savings Bank executive; Francis Keala, former Honolulu police chief; Ronald Libkuman, attorney; and David Coon, retired Iolani School headmaster.

Only Coon has said he is not interested in serving as a permanent trustee.

* * *

From The Kamehameha Schools’ website:

Current Trustees of
The Kamehameha Schools

Diane J. Plotts

A general partner in the Mideast & China Trading Company in Honolulu (formerly Hemmeter Investment Company) Diane J. Plotts received her bachelor of science degree in accounting from San Jose State University in 1958, and was a finance officer in the US Air Force. . . .

A founding director of the Bank of Honolulu, Plotts currently holds business directorships with Hawaiian Electric Industries, Inc. as past chair of HEI’s Audit Committee and current chair of its Compensation Committee.

She currently chairs the audit committees for Hawaiian Electric Company, Inc. and American Savings Bank....

* * *

April 4, 2000

Estate paid law firm
bill for Holt

Nearly $15,000 went to S.F. lawyers for a case
that did not involve Kamehameha Schools

By Rick Daysog, Star-Bulletin

The Kamehameha Schools paid a San Francisco law firm nearly $15,000 to defend former state Sen. Milton Holt during a 1993 federal political corruption investigation, in the latest questionable expenditure involving the convicted former lawmaker.

The $6 billion charitable trust picked up Holt’s legal tab with Farella Braun & Martell L.L.P. in 1994, even though the federal investigation did not involve the estate and apparently was not related to Holt’s duties at the trust.

Estate records do not identify the nature of the federal investigation, but sources said it involved the alleged bribery attempt of then Senate President James Aki.

In 1993, the FBI conducted a preliminary inquiry into charges that Indonesian developer Sukamto Sia, then known as Sukarman Sukamto, offered to develop Aki’s Nanakuli property if Aki would relinquish the senate presidency in favor of Holt.

Holt was then vice president of the Senate.

Holt, Aki and Sukamto were never charged and all have denied wrongdoing.

Sources said that Holt’s legal payments were authorized by the estate’s then-general counsel Nathan Aipa on the recommendation of C. Michael Heihre, formerly known as C. Michael Hare, one of the estate’s outside attorneys.

In a four-page opinion dated Sept. 26, 1994, Heihre said that while the federal investigation was not linked to the Kamehameha Schools, Holt’s employment at the trust gave him a higher profile and made him a “more controversial target,” according to people who have seen the report.

Heihre also compared Holt’s situation to that a corporate executive who is accused of wrongdoing.

Heihre is a former chairman of the nine-member state Judicial Selection Commission, which nominated the state Supreme Court justices. Until recently, the state Supreme Court selected Kamehameha Schools trustees.

Heihre, whose firm has conducted millions of dollars in legal work for the estate throughout the years, declined comment, citing attorney-client privilege.

Doug Young, the Farella Braun attorney who represented Holt in 1993, also had no response. The estate had no comment, a spokesman said, while Aipa, now the estate’s chief operating officer, could not be reached for comment.

The 47-year-old Holt, a Kamehameha Schools graduate, joined the estate in 1987 as an associate athletic director and later served as special projects officer in the trust’s government affairs division before the estate interim board of trustees terminated him last year. His tenure at the trust has been marked by legal entanglements and embarrassing disclosures.

Holt is serving time in a federal prison after he pleaded guilty to a mail fraud charge relating to campaign finance abuses. A federal grand jury indicted Holt for theft of thousands of dollars of campaign funds in 1998 and later added new charges that he used the campaign funds to pay for car insurance premiums and a family member’s birthday party.

While awaiting trial, Holt tested positive for illegal drugs, violating the conditions of his bail.

The state attorney general has alleged that Holt spent thousands of dollars on the estate’s credit cards at isle hostess clubs and Las Vegas casinos.

* * *

April 11, 2000

Citibank poised to assume control of
Executive Centre

Sukamto Sia’s former holding would help
reduce his debt by $500,000

By Peter Wagner, Star-Bulletin

A sleek downtown high-rise once owned by international investor Sukamto Sia would change hands, yielding about $500,000 to his bankruptcy estate, under a plan to be considered in U.S. Bankruptcy Court next week.

It won’t put much of a dent in Sia’s $296.4 million debt, but the deal offers the largest payout to date in a difficult effort to find the high-spending businessman’s unencumbered assets around the world.

The plan would transfer ownership of the heavily mortgaged Executive Centre on Bishop Street to prime lender Citibank N.A., holding $56.6 million in loans against the 41-story tower.

The property in February was valued at $39.5 million, according to court documents.

If approved, the plan would avoid a pending foreclosure suit filed against the property by Citibank a month after Sia went into bankruptcy in November 1998.

“It isn’t much,” said Guido Giacometti, trustee in Sia’s ongoing Chapter 7 bankruptcy. “Everybody’s taking a haircut.”

None more so than Citibank, which agreed to reduce outstanding debt from $56.6 million to $39 million, a $17.6 million loss if the plan is approved.

“Life is not always fair,” said Citibank attorney Tom Roesser. . . .

The mortgage, transferred by Sia to a British Virgin Islands corporation called A-B-C Pacific Ltd. shortly before his 1998 bankruptcy, had been sought as part of the estate by the bankruptcy trustee.

Executive Centre, formerly owned by MKS Executive Partners, a Sia holding, is one of Sia’s two major holdings in Hawaii. The high-rise houses a 120-room Aston hotel, several retail outlets including Long’s Drugs and Ross Dress For Less, and 379 residential units.

The other key property is Sia’s 74 percent stake in the Bank of Honolulu, 307,964 shares now held and being marketed by Giacometti.

The trustee is preparing a report to the court on collections by the estate.

Those efforts, which include reclaiming international properties, have so far yielded modest results.

The auction last year of Sia’s wine collection, several cars and personal effects raised about $250,000. More recent efforts have yielded some foreign bank proceeds.

Sia filed for bankruptcy protection from his creditors in November 1998, claiming $9.3 million in assets and more than $296 million in debts. His bankruptcy came weeks after his arrest in Las Vegas for allegedly writing $13.5 million worth of bad checks to pay gambling debts.

Formerly known as Sukarman Sukamto, Sia was a high-profile investor in Hawaii during its “bubble” economy of the 1980s. Besides buying Executive Centre and numerous residential properties, Sia acquired and later sold to the state the site that now houses the Hawaii Convention Center.

Sia initially filed for protection under Chapter 11 reorganization bankruptcy but later converted the case to a Chapter 7 liquidation.

Giacometti in December filed a separate Chapter 11 bankruptcy for MKS Executive Partners, a Sia holding and former owner of the Executive Centre property.

The bankruptcy reorganization plan would transfer the property to a limited partnership controlled by a Citibank affiliate.

The affiliate would hold an 80 percent interest in the property, with 10 percent retained by MKS affiliate SHC Realty Inc.

SHC-Realty & Management is general partner in a limited partnership owned by Sukamto Holding Corp. The holding company was owned by Sia until his bankruptcy, when ownership passed to the court-controlled estate.

Remaining interest in the property would be divided among unsecured creditors and A-B-C Pacific.

* * *

July 9, 2000

Bankrupt developer Sukamto Sia
denies he hid assets

by Frank Cho, The Honolulu Advertiser

Sukamto Sia, the once high-flying Honolulu developer and banker, is disputing allegations that he hid millions of dollars in the months leading up to his 1998 bankruptcy filing.

Sia said the bankruptcy trustee investigating him is ruining his life by making unsubstantiated allegations suggesting that he’s lying about his insolvency.

“I have nothing to hide,” Sia said in a recent telephone interview with The Advertiser. “But when you ruin my life, you ruin a lot of other people’s lives who work for me.”

Sia denies he is lying about his insolvency. The interview is the first time the publicity-shy Sia, formerly known as Sukarman Sukamto, has commented publicly about his business dealings and the battle over his multimillion-dollar estate since he filed for bankruptcy protection on Nov. 6, 1998.

In that filing, Sia revealed debts of $300 million and claimed assets of just more than $9 million, mostly in property and stock in the Bank of Honolulu. The case was later changed to a Chapter 7 liquidation on June 4, 1999.

It is one of the largest trans-national personal bankruptcy cases on record.

“I was not prepared to talk about this a year and a half ago. When you go bankrupt, all you want to do is forget, you don’’t want to keep talking about it,” said Sia, who estimates that after the collapse of Asian stocks in 1997 he lost nearly twice as much money as the $300 million creditors claim they’re owed by him.

In more recent developments, Sia, 42, is accused of funneling millions of dollars through family members and business associates months before he filed for bankruptcy protection in an effort to dodge those creditors.

A filing last month in U.S. Bankruptcy Court in Honolulu was the most serious allegation to date about Sia’s pre-bankruptcy activities and about his cooperation with authorities since the filing. Sia said the accusations have taken a personal toll on himself and his family and is making it harder for him to rebuild his business.

In those filings, bankruptcy trustee Guido Giacometti said Sia failed to reveal $10 million in proceeds from the sale of a corporate jet, a secret bank deposit box at the Bank of Honolulu, and hundreds of thousands of dollars in credit card payments Sia made for his wife.

Investigators say some of the transactions involve dealings by little-known offshore corporations in the British Virgin Islands that Sia created and never disclosed.

But in the interview, Sia said he did not reveal the safe deposit box because it was used to keep cash and jewelry and not documents related to his financial dealings, and that he used the British Virgin Islands companies as a cover to acquire stock in Asian businesses he was interested in – not as vehicle to hide money.

“I think it’s pretty common to do this in Asia. I am a high-profile guy, so when I open a BVI (British Virgin Island) company, it means I am buying stock and I don’t want anyone to know it is me,” Sia said.

Many of the BVI companies, Sia said, used loans from brokerage firms to help acquire positions in Asian companies. But like many investors, Sia said he suffered large financial losses during the Asian money crisis and was unable to repay the loans. . . .

Until the 1980s, Sia was virtually unknown here and in Asia. Born in Indonesia, Sia attended business school in London before graduating with a bachelor’s in business from Chaminade University in Honolulu.

Early on, Sia’s father-in-law, Atang Latief, was instrumental in helping launch Sia’s career with the purchase of 16 acres in Salt Lake near the airport for condominium development.

But it was Sia’s $6.8 million purchase of the Bank of Honolulu in 1987 that put him in the spotlight. And as Sia’s fame grew, so did his fortune.

With his penchant for gambling, Sia became one of the world’s biggest high rollers. Sia declined to put a figure on how much he has lost at casino tables, but some estimates put it at around $100 million.

In January 1998, Sia signed $6.6 million worth of markers while gambling at the Rio Hotel in Las Vegas. Markers at Caesars Palace added up to nearly as much. History had shown that Sia was good for it, however, and other casinos still welcomed his business.

Mirage Resorts Inc. Chairman Steve Wynn, who was hoping to land Sia as a regular customer at the new Bellagio casino, had Sia flown to Las Vegas in October 1998 for a stay.

But Caesars and the Rio apparently lost patience, and turned Sia’s debts over to the Clark County district attorney’s office for prosecution. Sia was arrested as he got off a private plane in Las Vegas in late 1998.

At the time, Sia was already under pressure from creditors in Singapore, where banks had filed suit against him for more than $60 million in unpaid debts and were preparing to begin selling his assets there.

Came back to Honolulu

Filing for bankruptcy protection in the United States would stop those sales, Sia said his attorneys told him. Sia returned to Hawai‘i to file for bankruptcy protection and step down as chairman of Bank of Honolulu.

So in another roll of the dice, Sia hoped the filing would give him and his business investments time to recover. But when the Asian economy failed to turn around quickly, Sia’s estate was forced from bankruptcy reorganization into liquidation and Sia lost control of his companies.

Facing felony charges

Since then, the Clark County district attorney’’s office has dismissed charges against Sia related to the Rio markers. Sia still faces felony charges for unpaid markers at Caesars and a hearing is scheduled for July 26, according to a district attorney’’s office spokeswoman.

In Hawai‘i, Sia has asked the court to dismiss his bankruptcy case, but the move is being opposed by Giacometti.

“He (Sia) doesn’t like the heat,” Giacometti said. “They want to shut down this investigation and for everybody to go home.”

Giacometti said he is committed to recovering as much as possible for creditors. So far, he has recovered about $1.5 million. Another $500,000 is expected to be recovered soon from a recent settlement with Citibank over its mortgage on Executive Centre in downtown Honolulu, which had been owned by a Sia company.

Expensive recovery

Sia’s largest single asset, 76 percent of the stock in the $95 million Bank of Honolulu, has been put on the market and Giacometti is hoping for a sale by the end of the year.

Giacometti admits that because of Sia’s complex and far-flung business dealings, the recoveries have not come cheap. Giacometti and his advisors have claimed nearly $500,000 in fees and expenses – paid for out of the recovered money.

Sia said Giacometti and his advisors are only interested in dragging this case out and generating more fees from his estate.

“I’m sorry I ever filed bankruptcy,” Sia said.

Sia, who now lives in Macau and does consulting work for casinos there, said he would like to return to Hawai‘i someday.

“If there is ever an opportunity there, of course I would like to come back,” Sia said.

But first, he plans to rebuild his business one deal at a time.

“I am just going to work hard and prove it to myself that I can come back,” Sia said.

“When this thing is over, and those guys are gone, I will still be around.”

* * *

March 1, 2001

From The Hawaii Channel, reported by Jim Dooley:

Exclusive: Sukamto Sia Staying
in Bel Air Mansion

Just a few months ago, the federal government wanted Sukamto Sia to stay behind bars as he awaited trial on fraud and money-laundering charges.

He’s out of jail now, living in the lap of luxury.

It’s about as far as you can get from a jail cell at Oahu Community Correctional Center.

That’s where Sia was originally held, without bail, when he was arrested by the FBI in August on bankruptcy fraud charges.

After some prominent local friends of Sia went to bat for him in federal court, Sia was allowed to move into the Miller Hale halfway house.

Then the court allowed him to move into a unit at the upscale Waikiki Landmark condominiums on Kalakaua Avenue. The accommodations there are very nice, but they’re nothing compared to where Sia’s staying now.

A $4.6 million estate in the posh Bel Air district of Los Angeles.

The house is on nine acres of land and includes a pool, lighted tennis court, five fireplaces, six baths and a complete guesthouse.

Sia’s been staying there since mid-January with his girlfriend, Kelly Randall.

According to court records, Sia has to be in Los Angeles for diagnosis and treatment of a lump in his neck.

He’s under the care of a specialist at the University of Southern California. . . .

The Bel Air house is owned by a British Virgin Islands company called Indobridge Investments.

Sia’s personal attorney, Renton Nip*, handled the purchase paperwork for Indobridge.

KITV4 News investigative reporter Jim Dooley asked Nip what was Sia’s connection to Indobridge or the Bel Air house.

“I don’t know what his connection is to Indobridge,” Nip said….

One of the money-laundering counts against Sia involves $100,000 sent to a California bank account controlled by Randall.

Sources said that one million dollars was wired from Macau, China – where Sia was living before his arrest– to a casino account opened by Randall at the Bellagio Hotel in Las Vegas.

Sia has been a regular customer at the Bellagio. Last year he gambled away more than $100,000 that didn’t belong to him during a stay at the Bellagio….

*For more on Renton Nip, GO TO > > > Buzzards of Paradise

* * *

May 17, 2001

SIA FACES 13 MORE FRAUD COUNTS

A federal grand jury includes his
friends and family in charges.

By Tim Ruel, Honolulu Star-Bulletin

Former Honolulu businessman Sukamto Sia has been indicted yet again, this time along with two of his younger brothers, two business partners and his girlfriend.

A federal grand jury yesterday added 13 new counts to the nine charges already pending against Sia, 42.

Twelve of the new counts name Sia directly, and some are related to earlier charges brought against him.

The charges include counts of bankruptcy fraud, wire fraud, bank fraud and making false statements.

The U.S. government is also seeking to have Sia forfeit a $4.5 million estate on nine acres in the Bel Air district of Los Angeles, where he has been staying for the past few months with girlfriend Kelly Randall.

Also named in the indictment are Sia’s brothers Suwardi Sukamto, 35, and Sumitro Sukamto, 37; Singapore resident Khee Pow Yong; Indonesian resident Johannes Sjah; and Randall, 33, of Los Angeles.

The six defendants have not yet entered their pleas to the new charges.

Sia’s attorney William McCorriston is out of town and could not be reached for comment last night.

The new indictment alleges a complex web of conspiracies that Sia is alleged to have taken part in during his tenure as chairman of the former Bank of Honolulu and after he filed for personal bankruptcy on Nov. 6, 1998.

Indonesia-born Sia bought a 30 percent interest in the Bank of Honolulu in 1987 along with his Indonesian father-in-law, Atang Latief, who bought 70 percent. Latief later sold his interest to Sia.

The government alleges that in 1997, Sia received a $40 million loan from Singapore bank Commerzbank using duplicated shares of his Bank of Honolulu stock.

The Bank of Honolulu board had been told that Sia lost his original shares, so they issued new shares. But Sia actually pledged the first set of shares for an earlier $40 million loan from another Singapore bank, Societe Generale, the government said.

Sia’s brother Suwardi Sukamto was allegedly involved in the scheme, according to the indictment.

The government alleges Suwardi Sukamto is also tied in with British Virgin Islands company Indobridge Investments Ltd., which owns the estate occupied by Randall and Sia.

Randall has also been charged with making a false statement by opening a bank account a year ago for Sia under an assumed name.

Another defendant, Johannes Sjah, is the founder of Indobridge and also founded one of four companies that received a million-dollar deposit when Sia sold his Gulfstream personal aircraft before filing bankruptcy, the government alleges.

Four charges of bank fraud also involve a deal in which four $1.5 million loans were set up in March 1997 at the Bank of Honolulu under the name of Indonesian cigarette magnate Putera Sampoerna.

Sampoerna has told authorities he never authorized the loan. The money really went to Sia, with help from Suwardi Sukamto, the government alleges.

According to records obtained from Sia’s bankruptcy case, a written order from Suwardi Sukamto to the bank in reference to the account reads, “Keep in mind that all communications with customer will be through me!!!”

No hearings have been scheduled on the indictments but are expected in the next couple of weeks. . . .

* * *

August 9, 2001

Secret Stash of Wine Auctioned

The Honolulu Advertiser

Part of the wine collection of former Bank of Honolulu chairman, Sukamto Sia went to auction today in Los Angeles.

Sia, who faces bank fraud and other federal charges in Honolulu, allegedly failed to tell his bankruptcy trustee about the wine.

He originally claimed a collection of a few hundred bottles worth about $60,000. Those were auctioned in 1999.

But trustee Guido Giacometti said Sia secretly shipped several thousand pounds of bottles that year to his $4.5 million estate in the Los Angeles suburb of Bel air, where today’s invitation-only auction was held.

Sia was allowed to move to Bel Air to await treatment at the University of Southern California for a problem with his parathyroid gland….

Verner, Liipfert, Bernhard, McPherson and Hand – Washington power-house legal firm.

October 22, 2001

Even Superstar Law Firms Find the Need to Thin the Ranks

By James V. Grimaldi, Washington Post

Verner, Liipfert, Bernhard, McPherson and Hand, the law firm that attained superstar status in the 1990s by hiring big-name ex-politicians and bulking up on business from the cigarette industry, plans to lay off about 20 lawyers and lobbyists by year’s end and has already lost two dozen lawyers this year.

The K Street firm’s restructuring will mean a cut of at least 20 percent in the lawyer ranks, the dismissal of more than two dozen staffers, the closing or shrinking of four branch offices and a series of other cost-saving moves, including the firing of its accounting firm, firm officials said.

“Verner has never had anything like this in its 40-year history,” said Peter Pantaleo, co-chairman of the firm’s policy committee. “The very thought of talking to colleagues and saying we don’t have enough work has been traumatic.”

Lobbying income from tobacco companies has dropped to zero from $8.2 million three years ago at Verner, but firm officials said these layoffs are prompted primarily because of the declining economy.

The economic downturn also has forced similar cutbacks at other firms: Morgan, Lewis & Bockius, the 128-year-old Philadelphia-based national firm, also is laying off 50 of 1,100 lawyers across the nation, including 15 of 328 lawyers in Washington.

“Having associates who are not busy not only makes little sense from a financial perspective, it puts those associates in a position where they are not growing and developing as lawyers,” Morgan, Lewis Chairman Francis M. Milone wrote in a memo about a week ago to firm lawyers. “We felt it was better to acknowledge the situation, take appropriate action and move along.”

Until recent months, laying off associate lawyers has been considered rare. And, until the Verner, Liipfert and Morgan, Lewis cutoffs, the previous layoffs have occurred primarily among those that had rapidly built their firms to cater to technology companies. . . .

But now the hard times are hitting even firms that thought they were diversified enough to handle it. At Morgan, Lewis, the numbers told the story. Work had dropped and the number of lawyers leaving the firm through normal attrition was half what it had been a year earlier. “The result of those facts is that we simply have too many lawyers in certain practice specialties for the demand that we anticipate will occur in the next year,” Milone said.

Both Verner, Liipfert and Morgan, Lewis noted that other law firms have taken what has been a more traditional law-firm tack by letting lawyers go — but doing it by telling them they are failing to produce rather than admit that the real problem is the economy. These firms contend that their approach is more honest and they took it because they do not believe the layoffs reflect poor performance. Both firms formally notified their lawyers this month.

One measurement for determining who is laid off at Verner will be whether the attorney billed less than $1 million or less than 1,900 or so hours. But the layoff will not be considered for cause, but because of economic conditions.

“In law firms, layoffs are not rare,” Pantaleo said. “They are common. What is rare is treating them humanely, honestly and with integrity. When a law firm goes forth and suddenly has 20 fewer lawyers than they had, that law firm had a layoff, though they might claim they weeded out weaker people.”

Verner became known for its political superstars — including former Senate majority leaders Robert J. Dole (R-Kan.) and George J. Mitchell (D-Maine), former Treasury secretary and former senator Lloyd M. Bentsen (D-Tex.), former Michigan governor James J. Blanchard, former Texas governor Ann W. Richards (D) and former senator Dan Coats, (R-Ind.). While some have complained that the big names also required big bucks, the firm contends that the stars, particularly Dole and Mitchell, still bring in a significant amount of business.

But even those star-studded ranks are quickly thinning. Bentsen is largely in retirement, Coats is now ambassador to Germany, and Richards has left the firm. And former Hawaii governor John D. Waihee (D) has spun off a separate firm, and Verner has officially closed its Honolulu office.

The Houston office is closing and the Miami office is being cut back to do only governmental affairs; both offices already have lost about 20 lawyers, including Lenard M. Parkins, who has taken Verner’s entire bankruptcy practice to Haynes and Boone of Houston. In February, James F. Hibey and four associates took the litigation section to Howrey, Simon, Arnold & White, leaving the remaining litigators spread out among specific practice groups.

Verner plans to scale back in such areas as corporate and bankruptcy work and will instead focus on the heart of its business — federal affairs, energy, labor, communications and international trade. “We need to focus on Washington, and in Washington we need to focus on those practices that are the nexus of business and government,” Pantaleo said.

In the process of downsizing, there still have been problems. The departure of many of these lawyers in outlying offices meant problems collecting bills from clients, and the firm had to write off more than $1 million in fees as uncollectable.

The downsizing also has outpaced the firm’s Web site. Honolulu is still listed as a branch office.

Also, featured not once, but twice, on the Austin page are photos of none other than Richards, who now is at the Austin public-relations firm Public Strategies.

* * *

December 12, 2002

Sia attorneys sued over hidden assets

Sia bankruptcy trustee Guido Giacometti has sued attorney
Renton Nip and the Verner Liipfert law firm

By Tim Ruel, Honolulu Star-Bulletin

A high-powered law firm and a prominent Honolulu attorney allegedly conspired to help imprisoned Indonesian businessman Sukamto Sia hide assets from creditors, according to a lawsuit filed by the trustee in Sia’s local bankruptcy case.

Renton Nip, a former state land use commissioner, and the Washington, D.C., firm of Verner Liipfert Bernhard McPherson and Hand knowingly helped Sia hide assets under foreign shell corporations, according to the suit.

Nip and Verner Liipfert have represented Sia in his bankruptcy proceedings. An attorney for Verner Liipfert denied the accusations. James Paul, an attorney for Nip, said the case has no merit.

“The acts had a wrongful or illegal purpose, and were carried out by wrongful or illegal means,” the suit said. “Defendants’ conduct in aiding and abetting the concealment of Sia’s interest and diverting the assets was willful, reprehensible, and in conscious disregard of the rights of the (bankruptcy) estate and creditors.”

The Verner Liipfert firm was acquired earlier this year and is now known as Piper Rudnick.

Nip, once of counsel to Verner Liipfert, is now an attorney at law firm Waihee & Nip, along with former Gov. John Waihee.

Waihee used to be with Verner Liipfert and joined Nip this spring after Verner Liipfert closed its Honolulu office, according to Nip and Warren Price III, attorney for Verner Liipfert.

Nip and Verner Liipfert also allegedly failed to disclose to the U.S. Bankruptcy Court that they had received several thousand-dollar payments from Sia after he filed for bankruptcy in November 1998, the nine-count lawsuit said.

The suit, filed in late October by bankruptcy trustee Guido Giacometti, seeks unspecified damages from Verner Liipfert and Nip as well as Sia, who is serving a three-year prison term in Lompoc, Calif. The suit also names Sumitro Sukamto, Sia’s younger brother. Federal charges against Sumitro were dropped after Sia made a deal last year to reduce his prison time by pleading guilty to bankruptcy fraud and wire fraud.

Sia denied all the new allegations in a court response filed last month by his attorney, Noah Fiddler.

Nip and Verner Liipfert denigrated Giacometti’s lawsuit in their own court motion, calling it incoherent and inadequate.

“This is the classic shotgun,” said Price, attorney for Verner Liipfert. Price said the counts against his client are groundless. Since the lawsuit appears to be grounded on underlying accusations of fraud, Giacometti should spell out how and when Verner Liipfert participated in a fraud, Price said. Once that is done, Verner Liipfert will seek to dismiss the counts against it, Price said.

A hearing on Nip and Verner Liipfert’s motion is scheduled for late January.

Giacometti declined to comment.

The suit revolves around allegations that surfaced in Sia’s federal bankruptcy fraud case, including the charge that Sia hid millions of dollars from the 1997 sale of his Gulfstream jet. The suit alleges Nip directed Gulfstream to wire more than $9 million from the sale of the jet to an account of one of Sia’s companies in Singapore.

It is also alleged that Nip received a $42,500 “bonus” from a transaction in which millions of dollars went to a shell corporation controlled by Sia from the sale of a Ritz-Carlton hotel in Sydney, Australia.

When Sia filed for bankruptcy, he said he had $9.3 million in assets and nearly $300 million in debts. Giacometti has estimated Sia’s actual assets at $79.6 million. Sia’s bankruptcy estate had received $4.6 million as of Sept. 30.

Nip and Verner Liipfert are also accused of malpractice. Giacometti alleges they had a conflict of interest in representing both the buyer and seller in a deal to sell Sia’s loan rights on the downtown Executive Centre high-rise.

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Thursday, October 11, 2018

Whistleblower Info: The Indonesian Connection

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