Straw donor trial delayed again amid plea talks

HONOLULU (HawaiiNewsNow) – The trial for Terri Ann Otani, who is accused of illegally funneling money to political candidates, has been delayed for a fifth time as plea negotiations continue.

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Otani and other employees of engineering firm Mitsunaga and Associates were acquitted of bribery conspiracy in federal court in 2024.

But testimony from that trial led the state attorney general’s office to file its own criminal case against the 71-year-old over straw donations.

Witness testimony overlaps

Megan Kau, a defense attorney and former deputy city prosecutor, said the state wasn’t investigating Otani before the federal trial.

“During the federal trial, people came and testified. And when they testified, they disclosed that Ms. Otani was subject to further criminal activity,” Kau said.

Among the witnesses who testified, JoAnn Aurello, Otani’s older sister who took the stand in the federal case saying she and her husband never made any political contributions to candidates.

But a search of the campaign spending website showed the couple gave more than $16,500 to various campaigns. Otani is accused of using Aurello’s name to make those donations, commonly called straw donors.

Otani’s niece, Jodee Haugh, also took the stand in the federal case after donations totaling tens of thousands of dollars were made in her name.

Legal expert explains legal distinction between cases

Legal experts said the state case does not amount to double jeopardy, even though witness testimony will overlap.

That’s because the federal case was about bribery, while the state case is about funneling campaign money through family members.

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Alexander Silvert, a retired federal public defender said all suspected straw donors should be prosecuted because it threatens a fair political system.

“When you have small amounts being joined together and giving — bundled is what the term is — to a legislator or large amounts, it’s really meant as a message to that legislator to influence their decision making in favor of this group of people or this company,” Silvert said.

Former judge questions delays

Randal Lee, a retired circuit court judge, said the delays are a bad look and the government should not allow additional time.

“This is not a complex case. It’s a document case. It’s a public corruption, white collar case. The government has its documents,” Lee said. “The case should be ready. You should be ready to go to trial. The plea negotiation should be many months prior to this day. And really there’s nothing to negotiate other than potentially sentencing considerations.”

Only defendant facing state charges

Otani had five co-defendants in the federal trial, but she was the only one to be charged with state crimes. Experts say that was because of a technicality.

“By the time that trial happened and the government learned about it, it was too late,” Silvert said. “The statute of limitations had already run because it ran from when the act occurred, not when it was discovered.”

Lawmakers tried to address that issue earlier this year to have the clock start running when the alleged crime is revealed, but that bill failed to pass.

The legislature did extend the bribery statute though from five to nine years.

If a plea deal is not reached, Otani’s straw donor trial is scheduled to start in mid-November.

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