Illegal campaign loans alleged
By Derrick DePledge
Advertiser Capitol Bureau
The manager of Dalton Tanonaka's unsuccessful run for lieutenant governor in 2002 has filed a complaint alleging that Tanonaka hid loans to his campaign to circumvent legal limits.
Ed Nishioka, president of Professional Results Inc., who has also sued Tanonaka over payment for media work, filed the complaint with the state Campaign Spending Commission on Friday. Tanonaka, a former television and newspaper journalist, is a Republican candidate for Congress and will face U.S. Rep. Neil Abercrombie, D-Hawai'i, in November.
"My campaign for lieutenant governor followed the law, so I am unclear as to the motive and timing of the complaint," Tano-naka said, adding that he will cooperate with the commission on any investigation.
The complaint, citing bank records, notes a $48,000 deposit into Tanonaka's City Bank account in June 2002 on the same day Tanonaka made a $45,000 loan to his campaign. The complaint does not list the sources for the deposit.
Tanonaka later wrote two personal checks, one in July 2002 for $15,000 and the other in September 2002 for $10,000, to Carol Tsai, according to the complaint. The second check had a notation that it was a loan repayment.
The complaint alleges that the campaign used "deceptive intent" to mask the loan activity.
The state's campaign spending law prohibits candidates from accepting personal loans over $10,000 for their campaigns, although a candidate's immediate family can give up to $50,000 and candidates can obtain loans from banks or other financial institutions.
Bob Watada, executive director of the Campaign Spending Commission, said candidates are not allowed to accept personal loans from people and then loan that money to their campaign.
Tanonaka said he gathered money from a variety of financial resources, but not from Tsai, to make the June 2002 deposit and subsequent loan to his campaign. He said he was still reviewing the complaint and could not immediately document the sources for the deposit.
He said he asked Tsai, a friend, for a loan for personal expenses unrelated to his campaign. "I borrowed money to pay bills," Tanonaka said.
Tsai, who could not be reached for comment yesterday, is a former president of the Hawai'i Chinese Tourism Association.
Tanonaka eventually lost in the primary to James "Duke" Aiona Jr., now the lieutenant governor.
The Campaign Spending Commission could decide at its Oct. 13 meeting whether to dismiss the complaint, ask for further investigation, set a hearing date or refer it to the prosecutor.
Nishioka, who could not be reached yesterday, also said in the complaint that the Tanonaka campaign failed to report two campaign expense checks totaling $9,000 to Professional Results in April 2003. Tanonaka said he believes the payments were reported in campaign filings and has asked his staff to look into the matter.
Tanonaka said he and Nishioka had a falling out after the campaign. Nishioka sued the Tanonaka campaign in Circuit Court in April, claiming his company was not paid for $40,000 worth of media work. The suit alleges a $40,000 check from the campaign to Professional Results in September 2002 bounced. Tanonaka said yesterday that the campaign owed the company about $10,000.
Reach Derrick DePledge at ddepledge@honoluluadvertiser.com or 525-8070.
