Senate committee demands transparency over 'Wonder Blunder'

Published On: Sep 24 2012 11:23:46 PM HST   Updated On: Sep 25 2012 09:05:27 AM HST

Lawyer Dennis Chong Kee was the first to speak before a Senate committee formed to understand, and lay out, step by step, what happened.

Kee produced what was called UH's fact finder's report.

The committee, led by Sen. Donna Mercado-Kim first focused on why Kee chose not to interview University of Hawaii President M.R.C Greenwood.

"Her involvement in planning the concert was non-existent. I did not feel it was worth the time to interview her for this particular incident," said Kee.

Lawmakers said Greenwood was required to "sign off" on any university fundraisers. Greenwood would testify that her approval was only necessary in what she called "fundraising campaigns" for the university.

Sen. Jill Tokuda questioned why UH didn't work with the fundraising branch for the university's athletic department called Koa Anuenue.

Kee's response: "We did not make a determination as to whether it was a fundraiser or not."

Athletic Director Jim Donovan said he recalled being out of town when his staff wired $200,000 to promoter Bob Payton, who was working under a contract with the university. He said he later found out neither was true.

Sen. Kim asked Kee where the "money trail" ended.

"On June 26th, the money was wired to some particular account. Beyond that, we did not investigate the money any further," said Kee.

Kee was hesitant to call the deal a scam, though he said he thought it was "very likely." President Greenwood readily concluded that in her testimony.

Lawmakers then grilled attorney Robert Katz, a partner with the Honolulu law firm Torkildson, Katz, Moore, Hetherington & Harris. UH hired the firm as legal council in preparation for the special senate committee meetings.

Sen. Kim questioned Katz on why so many names were redacted from the university's fact finding report, especially former UH Chancellor Virginia Hinshaw.

"We redacted all the names of people who were not university employees, and because it is still unclear who is and isn't innocent. We made a mistake with former Chancellor Hinshaw in redacting her name because we didn't realize she was still employed as a faculty member," said Katz.

A little more than an hour into the meeting, President M.R.C. Greenwood began her testimony.

"This was a well-intended benefit concert, but it was poorly conceived, and as a result unfortunately for UH it appears all of the money was stolen from us not by us," Greenwood began.

Greenwood stumped lawmakers on several questions, saying she couldn't disclose everything she knew about what happened because a law enforcement investigation is going on and she didn't want to jeopardize the case.

She reviewed the steps that had already been taken by the university, including putting Athletics Director Jim Donovan on paid leave, then shifting him to another position.  Also, reducing the AD's authority, doing an internal audit, and narrowing the job of the Stan Sheriff Center manager.

She also asked lawmakers for "more time" to allow the UH Board of Regents and a task force to investigate what other steps need to be taken to avoid another fiasco.

"We really had the perfect storm here. We were taken advantage of by this situation. We had employees who were under extreme pressure by outside forces to release the money. They made a mistake in pushing to move the money when they did not have things in place that should have been in place and I apologize for that, but that is what happened." said Greenwood.

Sen. Kim appeared unsatisfied with his answer, saying: "We're not talking about a small entity or a fly by night entity. We're talking about the University of Hawaii that has highly paid attorneys, highly paid staff and a whole fiscal department. Yet there were a number of policies that were violated and this could have been stopped along the way."

"Let me repeat again," said Greenwood, "We are not done with trying to take corrective action. We are disturbed by some of the findings and my guess is the board task force will be was well. I don't want to imply (people) have gotten a pass on this one. That's not true." 


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