Police chief in middle of family dispute

Sept. 27--Honolulu Police Chief Louis Kealoha has been drawn into a messy family legal dispute that pits his wife on one side and his wife's uncle and 95-year-old grandmother on the other.

A federal prosecutor has named Kealoha as a government witness in a criminal case involving the uncle, Gerard Puana, who is charged in U.S. District Court with tearing down the mailbox outside the Kealohas' Kahala home in June last year.

Kealoha said he woke up one night and noticed his mailbox was missing. He said someone had been disturbing his home for about a year, throwing rocks at it, entering his garage, damaging his vehicles and shooting out his windows and front door.

He said he didn't report the incidents at first because he thought he could take care of them on his own. Eventually, he installed security cameras. One day, when his daughter was in the home, he arrived to find the doors he had replaced had been shot out again. So he decided to start making reports.

Kealoha said he reported the stolen mailbox to Deputy Chief Marie McCauley, who turned the case over to the Honolulu Police Department's Criminal Intelligence Unit. He said he doesn't know what happened with the case after that.

"I didn't keep track or drive the investigation," he said.

Kealoha said he moved his family out of Kahala because of the vandalism. The Kealohas sold their Kealaolu Avenue home in September 2013.

The department later turned the case over to federal authorities. According to court records, a U.S. Postal inspector looked at Kealoha home surveillance video nine days after the mailbox theft and concluded that the person in the video tearing the mailbox off its support post and placing it in a vehicle appeared to be Puana.

The Postal Inspection Service said the chief's wife, Deputy Honolulu Prosecutor Katherine Kealoha, reported the theft to police and identified her uncle, someone she has known her whole life, as the person in the video.

The federal prosecutor said in court records that he intended to introduce evidence that in January 2013, five months before the mailbox theft, Puana went to a Bank of Hawaii branch in an unsuccessful attempt to access statements for the joint account of his mother, Florence Puana, and his niece, Katherine Kealoha.

The prosecutor said Gerard Puana told a bank employee that he needed to find out what happened to $500,000 of his mother's money, that he was in the middle of a lawsuit over the matter and "he needed to access these statements immediately."

Puana filed a written response, telling the court that he has no objection to the government's proposed evidence and looks forward to discussing it in front of a jury.

Destroying a mailbox is a crime punishable by up to three years in prison and a fine. Puana has pleaded not guilty. Trial is scheduled for December.

Puana's lawyer, first Assistant Federal Defender Alexander Silvert said, "I do not believe it is (Puana in the video)."

The government has requested Puana provide notice of an alibi defense.

"We're not relying on an alibi defense," Silvert said.

Also scheduled for trial in December in state court is a civil case involving Puana, his mother and his niece.

The Puanas are suing Katherine Kealoha over money from a reverse mortgage on Florence Puana'sMaunalani Heights home. They filed their lawsuit in March last year, three months before the mailbox incident.

According to the lawsuit, Kealoha asked for power of attorney from her grandmother in 2009 to arrange the reverse mortgage. The reason for the reverse mortgage was so the grandmother could help her son, Gerard Puana, purchase a condominium. The Puanas claim that Kealoha told them money left over after the purchase would be used to refinance and pay off the reverse mortgage.

They claim that the MetLife reverse mortgage was for $534,596. After closing costs and fees, the grandmother was left with $513,474.

Records provided by Bank of Hawaii show that Kealoha and her grandmother opened a joint account with an initial $1,000February 2009. They deposited the $513,474 from the reverse mortgage in October 2009. That same month there was a withdrawal of $360,514 to purchase a Salt Lake condominium for the uncle.

After the purchase, there was $148,514 left in the account. By April 2010, there was only $365 in the account.

According to the bank records, Kealoha took $82,347 from the account through ATM and large cash withdrawals starting one day after the reverse mortgage deposit. She spent $37,405 on hotels and airfare, $9,353 on car expenses, $7,519 on shopping, $3,233 at restaurants and $10,171 for other items including Elton John concert tickets, insurance and cellular telephone payments.

The hotel payments include $23,976 to Sheraton Waikiki in January for Louis Kealoha's inaugural breakfast. Kealoha was sworn in as Honolulu police chief in November 2009.

The car expenses include a $4,000 payment to Mercedes Benz and $1,223 to a Maserati agent.

Katherine Kealoha said in a deposition for the case that she did not get a Maserati. She said the money went to the same company collecting the Mercedes Benz payments.

In her written response to the lawsuit, Kealoha said the reverse mortgage was her uncle's idea because he and his mother couldn't qualify for a loan to purchase the condominium and Kealoha refused to co-sign for one. She said the power of attorney was MetLife's idea, and she didn't use it because her grandmother signed all documents herself.

Kealoha said she never promised to pay off the reverse mortgage, but instead, collected money from her uncle to pay back the money he borrowed from her grandmother.

She said the money she spent from the joint account was either her own funds or reimbursement for money she loaned her grandmother in connection with the attempt to purchase the Salt Lake condominium. She also said some of the money went to pay for the apartment's furnishings.

Kealoha's grandmother sold her Nioi Place home in September 2013 for $928,000 to pay off the reverse mortgage and says she now lives with one of her daughters in Kailua.

Gerard Puana also claims in the lawsuit that Kealoha owes him $40,000 that he gave her for an investment hui and $30,000 he gave her for safekeeping.

He said Kealoha gave him $600 every month as a return on his initial investment of $25,000 then let him withdraw the money using a debit card from her business account. He said she told him to withdraw $800 every month after he gave her another $15,000.

Bank of Hawaii records show ATM monthly withdrawals of $600 starting November 2007, later increasing to $800, then ending in October 2009. It also shows monthly deposits in amounts just enough to cover the ATM withdrawals.

Kealoha said in her written response that her uncle never gave her $70,000, and that the $600 and $800 monthly ATM withdrawals were "courtesy money" for handyman jobs he did around her home.

To defend herself against the lawsuit, Kealoha turned to her insurer, State Farm Fire and Casualty Co., to pay for the services of attorney William McCorriston. Last November State Farm filed a federal lawsuit asking the court to declare that Kealoha's policy does not cover her for the actions she is alleged to have committed in the lawsuit. State Farm is also reserving the right to be reimbursed by Kealoha for whatever money they have expended for her defense.

McCorriston withdrew and was replaced by another lawyer last December.

Kealoha could not be reached for comment. She is on personal leave from her job as the head of the Hono­lulu Prosecutor's career criminal division.

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