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The Honolulu Advertiser
Posted on: Wednesday, November 6, 2002

Union's consulting contracts questioned

By David Waite
Advertiser Courts Writer

A computer operator for the United Public Workers union testified yesterday that she did much the same kind of bookkeeping work as Robin Sabatini, the daughter of UPW state director Gary Rodrigues, who was paid more than $100,000 a year to act as a consultant to the union.

Gary Rodrigues and his daughter, Robin Haunani Rodrigues Sabatini, were indicted last year on charges of mail fraud, conspiracy to defraud a health-care benefit program and money laundering.

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Linda Smith, a senior data entry operator who works at the union hall on North School Street, said she met with Sabatini in late 2000 or early 2001 to explain how she reconciled individual union members' accounts concerning questions over payments for medical, dental or life insurance.

Sabatini's company, Fourwinds RSK Inc., was named as a consultant to the union on health insurance issues 1996.

Smith was the first witness to testify after a one week hiatus in the trial of Rodrigues and Sabatini on federal charges of mail fraud, conspiracy to defraud a healthcare benefit program, conspiracy to launder money and money laundering related to their dealings with Hawai'i health insurers.

Federal prosecutors maintain that Rodrigues included the cost of retaining a consultant in contracts he negotiated with Hawaii Dental Service and the Pacific Group Medical Association and used the money that resulted to steer consulting contracts to his former girlfriend's stepfather, Al Loughrin, and then to his daughter.

Prosecutors claim the two did little or nothing in return for the money. They contend the consulting fees were included in contracts with health insurance providers without the knowledge of the union's board of directors or the rank and file.

But Doron Weinberg, Rodrigues' lawyer, contends that even with the cost of the consultant contracts built into the rates union members paid for medical and dental insurance, they paid the same or less for the health coverage negotiated by Rodrigues compared to similar health coverage provided by the state.

In response to questions from Weinberg, Smith said she did not know if some of the work Sabatini did on behalf of the union was to reconcile differences between the Voluntary Employees Benefit Association, which served as an agent for the UPW, and the health insurance providers.

The trial is expected to continue for another two or three weeks.

Reach David Waite at dwaite@honoluluadvertiser.com or 525-8030.