Ka Wai Ola - Office of Hawaiian Affairs, Volume 12, Number 10, 1 October 1995 — OHA is still broken, but we're starting to fix it [ARTICLE+ILLUSTRATION]

OHA is still broken, but we're starting to fix it

by Rowena Akana Trustee-at-large In voting on August 30, 1995 to fire the Administrator. the Board of Trustees took some of the first hard steps on the long road to reforming the institutional culture of the Office of Hawaiian Affairs. Contrary to some of the gossip circulating around Honolulu, his firing was not poliīieal. Those who voted for the removal of Mr. Carpenter did so because they had a strong sense

of their fiduciary responsibiiities to the trust. While certainly painful, the decision was necessary to keep the puhlie trust whole. On numerous occasions the Administrator placed the Office of Hawaiian Affairs in harm's way through his handling of personnel, contractual, fiscal and other matters. At present, there are three former employees threatening wrongful termination suits against OHA.

In a shameful display of arrogance, Chairman Hee tried to circumvent the actions taken by a majority of the Board at a special meeting of the Board of Trustees on August 30 at another more recent special meeting on September 7. He added insult to injury by using the Board attorney to attempt to tell the Board that they don't have the power to terminate anyone, whieh is laughable. As all of the liability is incurred by the trustees, it makes sense that all of the power exercised beneath the Board level is exercised at the pleasure of the trustees. For all of his energy and enthusiasm with whieh he childishly and repeatedly pounded his fist on the Board table, the Chairman had to be prodded by Trustee Kamali'i into acknowledging that the ballot he cast on August 30 was with the 6 person majority to fire the Administrator. No amount of prodding. however. not even a specific request at the meeting from a constituent, could urge the Chair and Vice-Chair, Trustee Aiona, to be accountable for their ro!es in the hiring of Mr. X, roles stated by Mr. Carpenter himself to be crueial. At least $10 million in short term invest-

ments were traded by Mr. X before he signed a contract - without Board approval or knowledge - with the Administrator on October 17, 1995. While he was trading for us, Mr. X was actually barred from working for any securities firm, as he was under investigation by the NationaI Association of Securities Dealers for insider trading. Even if the other seven trustees who were kept out of the loop on this matter wanted to, state law says that a trustee's office is not transferable to

another trustee and that their authority cannot be delegated in this manner. That is way too mueh trust money to be moving without the trustees being aware of it, to say nothing of the lega) cloud over his head. On November 4, 1994, the State Attorney General served the Office of Hawaiian Affairs with a subpoena relating to our financial dealings with Mr. X and asked for all documents conceming his hire. The

matter appears to still be under investigation by the State Attorney General, in spite of the fact that Mr. X has since resigned. Mr. X is not the only example of someone being paid without a contract or Board knowledge, simply the worst. Despite the fact that article XI of the Office of Hawaiian Affairs Bylaws requires Board approval for legal contracts, thousands of dollars have been paid by purchase orders to various attorneys without contracts or Board approval. For too long, Tmstee Hee has abused the powers of the Chairmanship. Fiduciaries to any tmst in Hawai'i are held by state law to the "pmdent person" principle, whieh means that they must administer the tmst in the same way as any prudent person would manage their own affairs. The kinds of personnel and contractual problems mentioned above, eompounded by insufficient, tardy and often unclear fiscal information from the Administrator, often made it very difficult for Office of Hawaiian Affairs trustees to uphold the "prudent person" principle.