Former Hawaii Commission Executive Director Sentenced to 46 Months in Prison for Embezzling AmeriCorps Funds and Offering a Bribe in Exchange for CARES Act Grants | USAO-DC

WASHINGTON Stacy Higa, 58, a former civil servant from Hilo, Hawaii, was today sentenced in federal court to 46 months in prison for embezzling funds from AmeriCorps and also for offering a bribe in exchange for grants under the CARES Act.

The announcement was made by Matthew M. Graves, U.S. Attorney for the District of Columbia, Deborah Jeffrey, Inspector General of AmeriCorps, and Steven Merrill, Special Agent in Charge of the FBI Field Office in Honolulu.

Higa pleaded guilty in October 2021, in U.S. District Court for the District of Columbia, to embezzlement and offering a bribe. He was sentenced by the Honorable Reggie B. Walton. After his prison sentence, Higa will be placed under three years of probation. He is required to pay $38,642 in restitution and an identical amount in a judgment forfeiture of the money. He will also have to complete 200 hours of community service.

“This defendant abused his position of trust when he stole from AmeriCorps, a critical federal program designed to help the most vulnerable Americans,” U.S. Attorney Graves said. “His attempt to obtain CARES Act funds through bribery showed a shocking disregard for the critical importance of the program. The Department of Justice will prosecute, to the fullest extent permitted by law, individuals who choose to abuse their position of power to enrich themselves at the expense of the American people.

“Stacy Higa exploited her position of trust to steal AmeriCorps funds from vulnerable communities and conspired to deprive her neighbors of money needed for pandemic relief,” AmeriCorps Inspector General Jeffrey said. “Today’s sentence holds him accountable, reflecting the seriousness of his offences.”

“The citizens of Hawaii deserve a government free from corruption. Stacy Higa’s actions undermine the respect and reputation of all public officials who have a responsibility to maintain the public trust,” said FBI Special Agent in Charge Merrill. “Today’s sentencing reflects the FBI’s continued commitment and dedication to working with our partners to identify, investigate and prosecute those who abuse their powers and hold them accountable.”

AmeriCorps is a federally funded network of national service programs that meet critical community needs, such as improving educational achievement, mentoring youth, alleviating poverty, preserving national parks, disaster preparedness, etc. AmeriCorps national service members agree to serve for a specified period, usually one year, in exchange for a living stipend, funding to be used for tuition, and other benefits.

From June 2011 to May 2020, Higa, a former Hawaii County councilman and mayoral candidate, served as executive director of the Hawaii Commission for National and Community Service, the state service commission responsible for administer AmeriCorps programs in Hawaii. From February 2018 until his resignation from the Commission, Higa embezzled more than $38,000 of AmeriCorps funds by signing and authorizing contracts and purchase orders between the Hawaii Commission and two companies he owned or controlled, without disclosing its control over the companies. Higa spent the embezzled funds on personal expenses, including paying about $20,000 for elective cosmetic dental work.

The CARES (Coronavirus Aid, Relief, and Economic Security Act), which was passed by Congress and signed into law in or around March 2020, provided financial assistance to individuals, businesses, states, and localities suffering from the economic effects of COVID-19. pandemic. Among other relief programs, the CARES Act created a $150 billion Coronavirus Relief Fund (CRF) to distribute to states, localities, and tribal governments to support expenses incurred due to COVID-19. Government entities that received money from the FRC could use the funds, among other things, to provide grants to small businesses to reimburse business interruption costs caused by required closures and to provide economic relief to people suffering from an interruption of employment.

In August 2020, Hanalei Aipoalani was hired to serve as the Honolulu City and County Community Services Department’s CARES Program Administrator and was responsible for administering CRF programs. From August 2020 to October 2020, Higa offered to provide financial benefits to Aipoalani to influence the approval of Higa’s applications for two grants totaling $845,000 under the CARES Act. Higa then had an employee draft and submit false and backdated invoices for the grants. Higa and Aipoalani discussed opening LLCs on Oahu and using their wives as directors to launder the money. As part of his plea deal, Higa admitted to expecting to receive at least $250,000 in profit from CARES Act funds.

Aipoalani, 43, of Waianae, Hawaii, separately pleaded guilty to embezzlement from AmeriCorps and accepting a bribe under the CARES Act. Aipoalani was sentenced on June 30, 2021 to 46 months in prison and ordered to pay full restitution to AmeriCorps.

The AmeriCorps Inspector General and the FBI Field Office in Honolulu investigated the matter. The case was prosecuted by Assistant U.S. Attorney Leslie A. Goemaat of the Fraud, Public Corruption, and Civil Rights Section of the U.S. Attorney’s Office for the District of Columbia.

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The AmeriCorps Inspector General, the FBI, and the U.S. Attorney’s Office are committed to investigating and prosecuting individuals who defraud the AmeriCorps program and programs under the CARES Act. If you become aware of fraud, waste, or abuse affecting AmeriCorps or any of its programs, contact the AmeriCorps Office of the Inspector General hotline at 1-800-452-8210 or [email protected]

On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to mobilize Department of Justice resources in partnership with government agencies to scale up enforcement and prevention efforts. pandemic-related fraud. The task force strengthens efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies administering relief programs to prevent fraud, among other methods, by increasing and integrating coordination mechanisms existing ones, identifying resources and techniques to uncover fraudulent actors and their agendas, and sharing and leveraging information and knowledge gained from previous enforcement efforts.

For more information about the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

Anyone with information about alleged attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Disaster Fraud Center hotline at 866-720 -5721 or through the NCDF’s online complaint form at: https://www.justice. gov/disaster-fraud/ncdf-disaster-complaint-form

Additionally, anyone with knowledge of fraud, waste, or abuse affecting AmeriCorps or any of its programs is encouraged to contact the AmeriCorps Office of the Inspector General hotline at 1-800 -452-8210 or [email protected]OIG.gov.

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