Walter "Jack" Kitagawa, CEO of Jackie's, was convicted in 1991 of forging Hawaiian Airlines boarding passes. At the time, he ran Jackie's Travel, a company that he started in 1985 in Hilo and sold in 1997. Kitagawa was fined $10,000 and given a five-year suspended sentence.

David Gierlach, an attorney representing Kitagawa, said he did not want to comment on his client's past because it is not relevant to the travel agency's current problems.

Michael H. Tanaka, president of Jackie's, was convicted in 2001 of lying to FBI agents investigating charges relating to the swapping of Hawaiian Airlines coupons while he was a chief agent for the carrier. Tanaka was fined $10,000 and given two years probation.

Tanaka did not return several calls seeking comment yesterday.

Jackie's halted operations after its charter airline, World Airways Inc., refused to fly because of a dispute over payments.

World Airways, which has been flying MD-11 jets three times a week for Jackie's, claimed in a lawsuit filed Monday that it hasn't been paid since March 17 and was owed $2.3 million. Gierlach said the travel agency has a number of disputes with World Airways that will be resolved in the courts.

Bill Brennan, a spokesman for the state Department of Commerce and Consumer Affairs, said the convictions did not prevent Kitagawa and Tanaka from operating a travel business because the company was not registered in their names.

In March 1998, two of Jack Kitagawa's relatives registered TM Travel Inc., doing business as Jackie's, with the state.

"As far as I know we don't have anything with Jack's name on it. So, we don't have anything to go after," Brennan said.

"At this point our enforcement arm (the Regulated Industries Complaints Office) is investigating the licensee. Jack is not a licensee, as far as I know, and neither is Mike."

Brennan said that the DCCA only enforces the law and that if there is a shortcoming, it has to be fixed by the Legislature.

In 2001, the Legislature passed Act 62 to strengthen laws governing the regulation of travel agencies and "better protect consumers of travel services without imposing excessive or burdensome requirements on the providers of travel services," according to a DCCA announcement.

Senate Consumer Protection Committee Chairman Ron Menor, D-17th (Mililani, Waipi'o), said he is willing to take another look at the law.

"I would be open to making such a change to the law next session in order to prevent this unfortunate situation," Menor said.

"It appears that in this particular area that additional protections for consumers are needed."

The 2001 legislation was enacted after James K.S. Lee, owner of Jimmy's Travel, declared corporate bankruptcy and pleaded guilty to first-degree theft in 1998.