Gov’t re-files criminal case against Retirement Fund’s former executive director
Pago Pago, AMERICAN SAMOA — The government’s case against the former executive director of the American Samoa Government Employees' Retirement Fund (ASGERF), Luatua Filisouaiga Ta’afua that was dismissed without prejudice by the High Court last year was re-filed this week.
Luatua appeared in District Court this past Wednesday for his initial appearance before Acting Associate Justice Elvis P. Patea, the same Judge who granted the government’s motion to dismiss without prejudice in February of last year.
Luatua was served with a copy of the arrest warrant when he appeared in District Court. Private attorney Marcellus Tala Uiagalele is representing Luatua while Assistant Attorney General Hanna Kim appeared on behalf of the government.
The defendant is charged with 28 criminal counts, including 14 counts of stealing and 14 counts of embezzlement, all class C felonies, punishable by imprisonment for up to seven years, a $5,000 fine, or pursuant to A.S.C.A 46.2101, a fine equal to twice the amount of gain from the commission of said crime, up to a maximum of $20,000, or both such fine and imprisonment.
Bail was set at $50,000, but was reduced to $35,000 after the court granted the defense motion for bail reduction.
Uiagalelei requested the court for a bail reduction for his client, saying that this was the same case the government filed against his client a few years back but was dismissed by the court without prejudice last year.
Uiagalelei informed the court that his client was released on bond during the whole time the previous case was pending and during that whole time, his client was in compliancewithf all conditions of his release.
According to Uiagalelei, his client is a family man who has a strong family tie here in American Samoa. He will never leave his family here in the territory and he’s not a flight risk. Uiagalelei further informed the court that his client has already turned over his passport to the government’s attorney.
Prosecutor Kim told the court that she’s not familiar with the case.
Patea did not disagree with defense statements, however, due to the seriousness of the allegation, he told the defense attorney that the court would need some bail for his client.
Patea then granted the defense’s motion and reduced bond to $35,000 subject to several conditions including making all of his court appearances; staying in close contact with his defense attorney and no direct or indirect contact with government’s witnesses in this case.
The defendant was placed in custody of the court marshal immediately after his initial proceeding awaiting the posting of his bond, before he was later released.
Preliminary examination is scheduled for Thursday next week, Aug. 13th at 1:30p.m.
The government stated in their case against the defendant that it was July 20, 2015 when Governor Lolo Matalasi Moliga directed then Police Commission Save Liuato A. Tuitele to initiate an investigation into allegations of fraud, stealing and misappropriation of ASGERF assets.
Factual background of the case stated that the defendant is the former executive director of the ASGERF and was in charge of the administrative details of the fund and kept all books, records, files and accounts and controlled all applications for annuities, benefits and refunds.
ASGERF, during the relevant time period, had two bank accounts with the Bank of Hawaii. The Benefits Account was for retirement checks issued to beneficiaries. The Administrative Account was for daily operational costs and expenses, which included employee payroll, facility repair, and travel expenses. Per ASGERF policy, two signatures, usually the Executive Director and a chairman of the ASGERF Board of Directors, were required on checks over $250. Checks of less than $250 only required the Executive Director’s signature.
The investigation came to light when an employee of ASGERF (whose name is mentioned in the court affidavit) notified the former and now deceased board chairman of ASGERF, Fanene Scanlan of questionable vendor payments, which were signed by the defendant.
ASGERF then sought an off-island agency, David Asay of Squire & Company, P.C to conduct an audit and the results of the audit were made available on Nov. 13, 2015. The auditor determined that the defendant was involved in certain misconduct and misappropriation of assets during the 2013, 2014 and 2015 fiscal years.
On Jan 29, 2016, investigators executed a search warrant at the Bank of Hawaii for defendant’s personal bank records. A few weeks later, on Feb. 8th, investigators executed a search warrant at the Bank of Hawaii and the ASGERF office for all documents relating to the ASGERF Administrative and Benefits accounts.
It was revealed during the investigation that while employed by ASGERF, the defendant; (i) created fictitious companies that were issued checks by ASGERF for various janitorial, moving, and elevator services that were then deposited in the defendant’s personal bank account or cashed with the defendant receiving all or part of the funds; (ii) used the rubber signature stamp of former chairman of the ASGERF Board, Fanene, on several checks without Fanene’s knowledge or approval; (iiI) issued himself additional payroll checks that were not authorized by the ASGERF Board; (iv) created and received an authorized personal loan from the ASGERF Administrative Account.
The government also alleges that the defendant created fictitious companies and money from the ASGERF was paid to these companies. The three fictitious companies were HardCore Cleaning (HCS); Star Company (SC) and Filiga Fialoa/Filiga Electric (FF/FE).
The government said that between May and June 2015, defendant issued five checks from the Administrative Expense Account to the HardCore Cleaning Service (HCS) for a total of $10,539.58. All five checks were paid based on invoices from the HardCore Cleaning to the ASGERF.
In May 13, a check in the amount of $3,876.56 was paid to the HCS with the name of Chin Moananu. According to the government, the check was negotiated on May 13 at the Bank of Hawaii (BoH) by Moananu, who received cash, which he gave all of or part of to the defendant.
On May 21st, a check in the amount of $1,998.23 was paid to HCS (Chin Moananu) and deposited. On the same date, the defendant made a cash deposit in the exact same amount into the defendant’s account as shown on a deposit slip from the BoH.
On June 8th, a $1,898.34 check was paid to the HCS. On the same date, a cash deposit in the exact same amount was made to the defendant’s account and was shown on a deposit slip from the BoH.
The fourth check on the amount of $996.66 was paid to the HCS on June 11th. On the same date, a cash deposit in the exact amount was made to the defendant’s account and was also shown on the BoH deposit slip.
Five days later on June 16th, a check on the amount $1,769.79 was made to the HCS. Later on that same date, a cash deposit in the exact amount was made to the defendant’s account and was shown on the BoH deposit slip.
The government further stated that two checks from the ASGERF Administrative Expense Account were issued by the defendant to his Star Company in the total amount of $2,995.00.
The first check in the amount of $750 was issued on June 3rd, 2015 to the SC bearing the late Fanene’s signature without Fanene’s consent.
Three days later on June 5th, a check in the amount of $2,145 was issued to the SC and deposited and cashed by Chin Moananu. On the same date, the defendant made a cash deposit in the amount of $2,145 into his personal back account at Bank of Hawaii and as shown on a deposit slip from the bank.
All seven of the mentioned checks were signed by the defendant and have the rubber stamp signature of Fanene, to satisfy the two signature as required by the ASGERF policy.
It was also discovered by investigators during the investigation that invoices from the two companies (HCS and SC) were presented to ASGERF for various cleaning services around the Centennial Building were all prepared from the same templates, had incorrect spellings of the payee, incorrect addresses, fictitious invoice numbers, and non-functioning telephone numbers.
(See Monday’s edition for more of the government’s case against Luatua, and what government’s key witnesses told investigators during the investigations).