HAWAIIAN BRIBERY SCANDAL Sends Maui Officials Behind Bars

How many more sticky fingers will grab the hundreds of millions of dollars pouring in for Lahaina disaster relief?

Jan 12, 2024

In yesterday’s video I went through the laundry list of Hawaiians who are serving time in federal prison because of these crimes. It raises the HUGE QUESTION about how the hundreds of millions of dollars will be "spent" on Maui following the fires.

I don’t normally read the New York Times, but this article underlines and expands what so many are concerned about: the astonishing bribery, grift and corruption rampant in Hawaii and on Maui in particular.

The NY Times reported the following (edited for brevity):

The bribery case involving the businessman, Milton Choy, prompted some county officials to begin phasing out the use of sole-source contracts — which are awarded without competitive bidding when officials determine that only one vendor is able to supply a particular good or service — but the practice is still in use in the county.
A look at Mr. Choy’s case reveals pitfalls in a procurement system that could confront the county as it prepares to handle millions of dollars in new spending. That very little has changed since the bribery scandal was revealed could leave the door open for some contractors to take advantage of the disaster or for government money to be wasted.
Most of the money spent so far has gone to firms hired to clear debris from roads and to manage traffic in the burned area. Consultants were also hired to assess damage to Lahaina’s water system and to develop temporary holding facilities for toxic debris.
And most of the contracts awarded so far went through without competitive bidding.
A computer analysis of publicly available county records shows that Mr. Choy’s company, H2O Process Systems, was awarded about $12.7 million in sole-source contracts by Maui County between 2015 and 2022 — more than any other vendor received, and more than 13 percent of the county’s total spending on such contracts. Federal prosecutors put the total amount of all contracts paid to H2O Process Systems by Maui County at around $19.3 million since 2012.
The suspension of competitive bidding is not the only hole in a county contracting system that is about to handle millions of dollars in spending, as the state rebuilds from the wildfires, which caused at least $5 billion in damage.

As Lahaina residents are still reeling from the atrocities they suffered in the fire attack of August 8, 2023, multi-million dollar contracts are being handed out to sole vendors without any competitive bidding.

As the NY Times reported, this disaster resulted in at least $5 billion in damage and as we can clearly see, these disasters become money-making opportunities for those in a position to profit from them.

Whenever there is a large disaster or emergency like hurricanes, earthquakes or scamdemics, the government needs significant financial resources and they turn to the financial markets for funding. One of the key ways governments secure these funds is through the issuance of bonds, a financial tool that allows them to borrow a lot of money very quickly.

Governments issue bonds, which are essentially a promise to repay the borrowed money with periodic interest. Investors, ranging from individuals to big financial institutions, purchase these bonds, providing the government with the necessary funds to respond to the crisis at hand.

Dec 19, 2023: OFFICE OF THE GOVERNOR – NEWS RELEASE – STATE OF HAWAIʻI ISSUES $750M IN GENERAL OBLIGATION BONDS

The above is a recent announcement from the Governor’s office. You may applaud this and think it’s fantastic because it’s going to fund essential public projects, stimulate economic growth, and improve the infrastructure — and I hope that it does. However, the government has to pay back the borrowed money with interest which could strain budgets in the future. So whether or not Hawaii manages its debt responsibly is another conversation, but no wonder the taxes are so high…

Various kinds of bonds may be issued by governments in times of disaster to raise money for relief and reconstruction activities. General Obligation Bonds (GO Bonds) and Revenue Bonds are what you will commonly see. For more information about GO Bonds click here.

Now, I don't want to perpetually presume that there are opportunistic individuals out there ready to seize on calamities for financial gain, but let's just say I maintain a healthy dose of skepticism. And as for the government, well, you know how I feel about the public serpents.