Corruption Trial: the cast of characters and the web the Kealohas weaved

Local News

It’s being called the “trial of the century.”

What led up to this point? How did a mailbox become synonymous with corruption?

We take a look back at the purported events that landed former police chief Louis Kealoha and his former deputy prosecutor wife Katherine in federal court.

During opening statements Wednesday, Michael Wheat, special prosecutor appointed from the U.S. Attorney’s Office in San Diego, addressed the jury:

“This case neither begins, or ends, with a mailbox.”

Wheat outlined a case laced with greed and abuse of power spanning over a decade.

In 2007, he told the jury, Katherine informed her uncle Gerard Puana that she could invest his money into a Makiki condo.

Convinced, Puana gave his niece $7,000. Katherine promsied returns on that investment in cash and a debit card he could withdraw $600 from each month.

Florence Puana, Katherine’s grandmother and Gerard’s mother, also took Katherine’s advice. Florence agreed to a reverse mortgage on the family’s Wilhelmina Rise home.

At the time, Katherine was Florence’s lawyer. Katherine began taking equity out of the family home’s reverse mortgage to pay for her and husband Louis’ lavish lifestyle. It reportedly included exotic cars and fancy concerts. 

The Puanas suspected something was amiss. They could see from financial documents the amount due was growing.

They learned Katherine never paid off the reverse mortgage. The interest continued to increase, eating up the equity that accumulated. Katherine also put the condo in a trust which named her as trustee.

The Puanas tried to contact Katherine, but Wheat said they were met with no answers. 

Letters were reportedly exchanged between Florence Puana and Katherine.

In 2012, Katherine wrote:

 “I will seek the highest form of legal retribution against anyone and everyone who has written or verbally uttered those lies about me! They will rue the day that they decided to state these twisted lies!”

In March 2013, the Puanas filed a civil lawsuit against Katherine alleging fraud and elder abuse. During the case, Prosecutor Wheat says, Gerard and Florence learned about the fake trust.

This is where the other defendants in the corruption trial enter the story. 

They are police officers handpicked by Chief Louis Kealoha; part of the Criminal Intelligence Unit within the Honolulu Police Department.

“A secret police force,” Wheat explained to the jury. 

  • Liutenant Derek Hahn, a business partner of Katherine’s 
  • Officer Minh-Hung “Bobby” Nguyen, related to Katherine by marriage  
  • Sergeant Daniel Sellers 
  • Retired Major Gordon Shiraishi, Louis’ friend of over 30 years  

Prosecutors allege Katherine set out to discredit her uncle so the grand jury in the ongoing civil suit would not believe him. 

On June 22, Katherine reported to police that their mailbox was stolen from in front of the family’s Kahala home. 

The mailbox was stolen, as Katherine would tell it, because Gerard wanted documents relating to the deposition that Katherine had given three days prior.  

Together with Hahn, Nguyen, Sellers and Shiraishi, Katherine and Louis schemed for 12 days to frame Gerard as the man seen in home surveillance video stealing the mailbox.

The U.S. Postal Inspection Service investigated.

On July 1, 2013, Gerard Puana was charged with destroying a mailbox – a federal offense.

On December 4, 2014, Chief Louis Kealoha took the stand for Puana’s trial in U.S. District Court. He says the person in the video is Gerard, but causes a mistrial by telling the jury about Puana’s prior conviction for unlawfully entering a neighbor’s home.

“Things began to spiral out of control,” said Wheat.

Puana’s public defender, Alexander Silvert, accused Louis of purposely causing a mistrial. Silvert turned over information to the FBI for investigation, ultimately leading the feds onto the Kealohas trail.

“Even this powerful law enforcement couple could not control all the variables,” Wheat told the jury. 

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