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The Honolulu Advertiser
Posted on: Thursday, September 8, 2005

Tanonaka, four others facing complaint from '02 campaign

By Derrick DePledge
Advertiser Capitol Bureau

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The state Campaign Spending Commission will review a new complaint against Dalton Tanonaka and four people involved with his failed 2002 campaign for lieutenant governor, which alleges improper contributions to the campaign.

Tanonaka, who pleaded guilty in federal court in July to diverting $73,000 in illegal loans to his campaign for lieutenant governor and his 2004 campaign for the U.S. House, still faces a separate complaint involving his reporting on state campaign disclosure statements. The Federal Election Commission is also looking at Tanonaka's congressional campaign.

Tanonaka, who likely will be sentenced in federal court in November, said he could not comment on the state complaints. The new complaint was brought by Robert Watada, the commission's executive director. The previous complaint against Tanonaka was filed last September by Ed Nishioka, his former campaign manager, and was referred by the commission to prosecutors and ultimately led to Tanonaka's guilty plea.

Commissioners are scheduled to discuss the complaints at a meeting on Tuesday, where they could be dismissed, held for further investigation, upheld for cause or referred to prosecutors.

The four people involved are Russell Hata, a former food service executive; Miles Furutani, an attorney who has represented Tanonaka before the commission; Carol Tsai, the former president of the Hawai'i Chinese Tourism Association; and Lance Masatsugu, the former treasurer of Tanonaka's campaign.

Hata yesterday declined to comment on the complaint. Tsai could not be reached. Furutani and Masatsugu did not return telephone calls seeking comment.

Tanonaka accepted outside loans and then disguised the money as personal loans to his campaign.

Candidates are free to lend money to their campaigns, and can accept loans of up to $50,000 from family members, but outside donors can only loan $10,000, and the money must be reported on campaign disclosure statements.

Since the outside loans were not reported, the commission can treat the money as improper campaign contributions. Tanonaka lost to Lt. Gov. James "Duke" Aiona in the Republican primary for lieutenant governor in 2002, and to U.S. Rep. Neil Abercrombie, D-Hawai'i, in the congressional race last year.

Reach Derrick DePledge at ddepledge@honoluluadvertiser.com.