Lindsey begins prison term

By David Waite
Advertiser Courts Writer

Former Bishop Estate trustee Lokelani Lindsey was ordered yesterday to start serving her six-month prison term for bankruptcy fraud immediately, after she was spotted in Las Vegas last month despite claiming that she was caring for her ailing husband here.

Lokelani Lindsey arrives at federal court. The former Bishop Estate trustee was ordered to begin serving her prison term immediately. Bruce Asato • The Honolulu Advertiser

Lindsey told the judge she had checked with her lawyers and they did not prohibit her from going to Las Vegas. "Had I known it would result in this, I would never have gone," Lindsey said.

But Ezra said Lindsey had violated the trust of the community and the court.

"She abused the privilege I gave her — not for her benefit, but for her husband's benefit," the judge said.

Lindsey was led from the courtroom by federal marshals after exchanging hugs with family members.

A former trustee for the multibillion-dollar charitable trust now called the Kamehameha Schools, she and three other trustees who made as much as $1 million a year were ousted in 1999 after state and federal investigators found evidence of what they claimed was mismanagement and abuse of power. A fifth trustee resigned.

Lindsey was sentenced last October to six months in federal prison on money laundering and bankruptcy fraud charges in connection with her sister's 1995 bankruptcy case, unrelated to her role with Bishop Estate.

Ezra granted Lindsey's request to delay the start of her prison sentence on three previous occasions, based each time on arguments by her lawyers that her husband was critically, if not terminally, ill and that she needed to be with him continuously to ensure he received proper medical care.

Lindsey's lawyer, William Harrison, acknowledged yesterday that Lindsey had traveled to Las Vegas twice since the start of the year, once in January with her ailing husband, Stephen, and again last month without him.

Harrison said Lindsey visited Las Vegas last month to consult with one of her lawyers, David Chesnoff, who lives there, and also to take a break from caring for her husband.

Assistant U.S. Attorney Les Osborne said those reasons "ring hollow," since there were no pending legal issues for Lindsey to discuss with Chesnoff in the bankruptcy fraud case and because Lindsey could have checked into any number of hotels or resorts on O'ahu to take a break from having to care for her husband.

But Harrison insisted Lindsey went to Las Vegas last month to consult with her other attorney and that he had a letter from Chesnoff attesting to it. He said Lindsey also visited her husband's 85-year-old sister, whom he fears never seeing again.

Harrison said the September trip also was a way for Lindsey "to test the waters to see what kind of care her husband was going to get after she goes in (to prison)."

Harrison said Lindsey didn't try to hide the fact that she traveled to Las Vegas. "She didn't skulk around Las Vegas," he said.

"What has she done wrong here, other than to prepare for the fact that she's not going to be with her husband for the next six months?" he said.

Lindsey thanked Ezra for granting the previous extensions, and said her husband underwent surgery three times during those extensions. "He was just in the hospital for congestive heart failure — we almost lost him in June and July," she said.

She said she had checked with Harrison and her other Honolulu lawyer, William McCorriston, and neither found anything wrong with her traveling to Las Vegas.

She also said she had been under tremendous stress "from a number of things," including having her car brake line cut.

The claim that her automobile was tampered with was part of a rambling statement containing Lindsey's signature deposited Thursday night in the after-hours court document box placed near the doors leading to the federal court building.

Lindsey acknowledged signing the document, which asked Ezra to recuse himself from her case, accusing him of federal grand jury tampering and of conspiring with others to deprive Native Hawaiians of their rights.

Harrison tried desperately to keep Ezra from discussing the document at yesterday's hearing, claiming it never had been filed formally with the court. But Ezra said he was treating it as a letter, and that because it had been placed in the overnight deposit bin, it had reached his court.

"It is the single most incomprehensible act I have seen during my entire tenure as a federal judge," Ezra said.

He said his decision to send Lindsey to prison a month earlier than she expected was not based on the request that he recuse himself or the accusations in the letter.

"I do find it incredible that she would have the temerity and arrogance to submit such a document in light of the steps I have taken to ensure the integrity of her family," Ezra said.

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