Admin embezzled $500,000 from a non-profit that helps at-risk communities

Yesterday, a 42-year-old resident of Waianae, Hawaii pleaded guilty in federal court to embezzling over $500,000 from a local nonprofit’s AmeriCorps program, called Olelo.

Hanalei Aipoalaniwho was formerly employed as a grant administrator for Aloha United Way, also reportedly conspired with the CEO of a public access TV station in an effort to fraudulently obtain funds from the 2020 CARES Act. Both offenses carry a statutory maximum prison sentence of 10 years.

“The defendant conspired to enrich himself with taxpayer dollars intended to support at-risk communities in Hawaii, he victimized legitimate volunteers and others by stealing their identities to perpetrate multiple fraud schemes, and he submitted falsified documentation and certifications to the government, all to the detriment of their community,” Deborah Jeffrey, Inspector General of AmeriCorps, explained in a press release released last week.

“Our investigation also disrupted an ongoing scheme to steal much-needed pandemic relief funds.

Aipoalani confessed to the aforementioned charges in a plea agreement. Court documents indicate that the ousted tycoon attempted to direct profits to the CEO of an unnamed public access television station.

Between December 2014 and June 2019, Aipoalani’s non-profit media program, Olelo received over $935,000 in AmeriCorps funds. Prosecutors claim that half of these funds were embezzled by Aipoalani.

“AmeriCorps trusted Hanalei Aipoalani with its mission in the State of Hawaii and was ultimately betrayed,” FBI Special Agent in Charge Eli Miranda said in a statement. “Aipoalani exploited his position and intentionally stole funds meant for the betterment of the community for his own selfish entitlements.”

Aipoalani allegedly used at least nine inactive or former AmeriCorps members’ names and/or signatures (without their consent) in order to redirect payments for his and his wife’s personal expenses between December 2014 through May 2019. These personal expenses reportedly include a 2014 Ford Fusion Hybrid.

Collectively, Aipoalani’s wife, Angelita Aipoalani received over $69,000 for work she didn’t do according to the plea agreement.

Together, the couple embezzled funds from the Corporation for National and Community Service, which is the agency that administers AmeriCorps. In 2016 and 2017, prosecutors claim that Aipoalani submitted false certifications indicating that his wife had served hundreds of AmeriCorps hours. This was later determined to be a lie. Still, CNCS approved two education awards to Angelita Aipoalani amounting to over $11,000.

Olelo President and CEO Roger McKeague, who noticed “financial irregularities” sometime last year, release an official statement on Monday.

We conducted an internal investigation and promptly reported our findings to federal authorities. We have fully cooperated with those authorities throughout this process. At their request, we have kept and will continue to keep the particulars of our communications confidential,” McKeague explains.

“We remain focused on keeping the public informed about critical issues in the state of Hawaii and empowering keiki to kupuna to find their voices and tell their stories.”

Aipoalani is scheduled to be sentenced on June 24th.