Judge quashes Suzuki subpoena
By David Waite
Advertiser Staff Writer
A federal judge yesterday ruled that state Rep. Nathan Suzuki cannot be made to testify in the ongoing tax evasion and bank fraud trial of Honolulu businessman Michael Boulware because forcing Suzuki to do so would violate his constitutional protection against self-incrimination.
According to court documents, federal officials have recommended that the five-term lawmaker from Moanalua Valley be charged with income tax falsification and conspiracy.
Suzuki, a relatively low-key member of the Legislature who rarely seeks the limelight, could not be reached to comment on the matter.
Federal prosecutors had subpoenaed him to testify yesterday against Boulware. The prosecution maintains that Boulware laundered millions of dollars from his Hawaiian Isles Enterprises company through a Tongan corporation called Pacific Vendors Equipment Ltd. to avoid taxes on the money.
Former Hawai'i Supreme Court Justice Robert Klein, Suzuki's lawyer, filed a secret request in federal court on Wednesday, asking U.S. District Judge Edward Rafeedie to quash the subpoena issued to Suzuki compelling him to testify at Boulware's trial.
Klein asked that the public be barred from the court hearing on his motion to quash the subpoena, but Rafeedie said there was no legal reason to do so. He held an open hearing on the matter yesterday and also ordered that court filings on the effort to quash the subpoena be unsealed.
Assistant U.S. Attorney Edward Groves said he wanted to call Suzuki to discuss individual and corporate tax returns that Suzuki prepared for Boulware and his company from 1989 to 1993. Suzuki was the controller for Boulware's company up until 1988 and did accounting and tax preparation work on a consultant basis after that.
Groves said that even if the tax returns were prepared fraudulently, Suzuki could not be prosecuted because the time period covered by the statute of limitations had lapsed. Groves said he did not intend to question Suzuki on topics other than Boulware's tax returns.
But Klein said that during a meeting earlier this year with officials from the Justice Department's Tax Division, he was told a recommendation had been made to the U.S. attorney's office that Suzuki be prosecuted on falsification and conspiracy charges for allegedly putting false information on his own tax returns regarding ownership of Pacific Vendors.
Rafeedie, in quashing the subpoena, said tht if the federal government intends to prosecute Suzuki on any charge, his right to avoid incriminating himself must be protected.
Suzuki has denied any wrongdoing in connection with the Boulware case. But in papers filed with the court yesterday, Groves said that Suzuki admitted "for the first time" that he was the majority shareholder of Pacific Vendors Equipment.
In papers he submitted to the court, Klein said Suzuki was the majority shareholder when it was incorporated in Tonga in about 1994. He said Suzuki agreed to the position to assist Boulware in the formation of Pacific Vendors.
It was hoped that Suzuki's status as an elected legislator would facilitate and expedite the incorporation process in Tonga, Klein said in his court filings.
Suzuki, D-1st (Salt Lake, Moanalua), was first elected to the House in 1992. He is known as a lawmaker with a detailed grasp of some very complex subjects, and was an early leading proponent of overhauling the Public Employees Health Fund after a state audit warned of the rapidly increasing cost of public worker and retiree benefits.
Suzuki, 53, has served on the powerful House Finance Committee ever since he was first elected. The committee has considerable clout because it must approve of all appropriations and digs into the details of the billions of dollars the state spends each year.
He is also chairman of the Legislative Management Committee, which recommends to the House speaker how much money should be budgeted to operate the House, and how the House and its staff should operate.
Suzuki, a CPA since 1971, has been self-employed since 1988. He also has worked as a real estate agent since 1980.
Advertiser Capitol Bureau chief Kevin Dayton contributed to this story.
Reach David Waite at dwaite@honoluluadvertiser.com or 525-8030.
