The former CEO of Hawai'i's largest group of cemeteries and funeral homes — who is charged with theft and named as a central figure in a $30 million civil fraud case — yesterday proclaimed his innocence and his intent to win back control of the companies.

John Dooley was chief executive of the RightStar group of companies from 2001 until 2004, when a foreclosure suit put the companies into a court-supervised receivership that continues to this day.

Attorney General Mark Bennett's office also sued Dooley and a group of associates, including former Hawai'i Gov. John Waihee, alleging that they conspired to improperly remove as much as $30 million from trust accounts held for 50,000 customers who had purchased "pre-need" funeral plans from RightStar. Those suits are still pending in Circuit Court.

Dooley was secretly indicted in December 2006 on charges of stealing $50,939 from 28 RightStar customers but wasn't apprehended until April 27, when police officers in Oregon stopped him for a traffic violation and discovered the outstanding warrant for his arrest in Hawai'i.

Dooley has been held at O'ahu Community Correctional Center since his return here in May, unable to post $100,000 bail. Yesterday, he lost a court bid to be released from prison without bail pending trial in the theft case, now set to begin in September.

His lawyer, Deputy Public Defender Henry Ting, told Circuit Judge Virginia Crandall that his client did not know about the indictment or the warrant for his arrest.

"He would have come back voluntarily if he had known about it," Ting said.

Dooley told the judge that if he is released from custody, "I have no intention of going anywhere. I'm fully prepared to defend myself. I expect to be victorious and I am anxious to get on with this process."

Although the RightStar companies have been operated by a court-appointed receiver since 2004, Dooley said he has been in negotiations with lenders to acquire funds to resume control of the companies.

Dooley said it is very difficult to conduct business and participate in his criminal defense from a jail cell.

There are "3,000 pages" of records in the criminal case and his court-appointed lawyer is unfamiliar with RightStar's business activities, Dooley told the judge. He also said he did not have money to post bail or to hire a private attorney.

He was accompanied to court by his wife, Kathryn Hoover, and private attorney James Wagner, who told Crandall he would sponsor Dooley if he is released from prison. Hoover is a former officer with her husband of the RightStar companies.

Wagner, a well-known Honolulu attorney who specializes primarily in bankruptcy cases, represented Dooley and Hoover when RightStar bought the Hawai'i funeral services and cemetery companies in 2001. He also assisted in securing operating licenses for the companies from state authorities.

"I don't believe he is a flight risk at all," Wagner told the judge.

He also said that Dooley had fully cooperated with state officials investigating both the civil and criminal cases.

Deputy Attorney General Lawrence Goya argued that, if convicted, Dooley would face up to 10 years in prison and a $25,000 fine.

"He does have a motivation to flee," Goya said.

He also objected to Wagner serving as a sponsor of Dooley, telling Crandall that some of the funds allegedly stolen by Dooley from RightStar accounts may have been used to pay Wagner's fees when the lawyer represented RightStar.

Crandall denied the motion for release and declined to reduce the $100,000 bail figure, saying she was concerned that Dooley has no community ties and may pose a flight risk.

RightStar owns Valley of the Temples and Diamond Head Mortuary on O'ahu, Maui Memorial Park, and Homelani and Kona Memorial Parks on the Big Island. RightStar also owns several companies that sell and administer pre-need funeral plans, including the 50th State Funeral Plan.

Since RightStar went into receivership, state officials have consistently said that all outstanding RightStar pre-need contracts will be honored.

A court-ordered auction of the RightStar assets in February attracted no bidders willing to pay the minimum asking price of $25 million.

Since then, Circuit Judge Sabrina McKenna approved employment of a new management team to run RightStar, as well as a new receiver, former Circuit Judge Marie Milks, to oversee operations for the court.

The new management plan calls for the company to aggressively market pre-need funeral, burial and cremation contracts.