Deputy prosecutor swindled her grandmother to fund an affair with a firefighter

Katherine Kealoha and her retired police chief husband, Louis, allegedly planned to take money from the trust the grandmother had set up to buy a condo for her son.

                            Deputy prosecutor swindled her grandmother to fund an affair with a firefighter
(Source:Getty Images)

A prosecutor in Hawaii has turned to a life of scams after she is said to have allegedly conned her grandmother into giving her $20,000 just so that she could sponsor a romantic trip with a high-ranking firefighter who has been in Kilauea fighting the volcano. Deputy prosecuting attorney for the Honolulu County, Katherine Kealoha, along with her husband Louis Kealoha, a retired Honolulu Police Chief and who was already indicted on bank fraud charges in June, allegedly hatched a plan to pilfer from the grandmother's trust money which she had been saving to buy a condo for her son.

The couple was trying to con the old woman out of $500,000. An indictment that was filed last month and a charging document that was filed recently in the US District Court in the District of Hawaii against her boyfriend showed that she tried to foil an investigation that was launched to look into the dubious money scandal.

In the document that was filed, a conspiracy charge was also filed against Jesse Ebersole, the deputy prosecutor's boyfriend, after he lied about having an affair with her. He also pretended like he did not know what the authorities were talking about when they asked him about the airfare and cash that she had allegedly sent him. He also did this while he was under oath and in front of a federal grand jury in 2017, Newsweek reported.

The document stated: “It was further part of the conspiracy that when Ebersole was called to testify before the Federal grand jury in Hawaii, [Katherine] Kealoha would counsel Ebersole to lie to the grand jury about their true relationship... including falsely claiming that he and Kealoha were just 'friends'; and that he had 'no idea' why his name would appear on Kealoha’s credit card statements."

In 2009, the Kealohas were accused of taking money from a deposit of $513,474 that was made by the grandmother, who is to be identified only by the initials "F.P.", which she had made so that she could “purchase a condominium for her son”, who is related to Katherine Kealoha and is to be identified by the initials "G. K. P.". The document stated that he looked after the grandmother and did not have sufficient credit of his own to buy the condo. Kealoha had helped the grandmother take out a "reverse mortgage" loan on the old woman's home. Court documents then suggested that she told her grandmother she would put all the proceeds toward the condo for her uncle. This turned out to be a false promise.

Federal prosecutors have said that the couple had taken some of the mortgage money to "consolidate their bills, thereby allowing them to improve their credit". Court documents stated that the Kealohas then took a separate mortgage on "F. P.'s" property just so that they could collect the mortgage payments that were made by her son "instead of to a bank". According to the documents, Katherine allegedly “withdrew and transferred funds to pay the Kealohas’ personal expenses and to purchase items for and enrich Ebersole,” over the years.

She then allegedly continued with her affair with Ebersole. The document states that in 2009, Katherine paid Ebersole's flight tickets from Hilo to Honolulu and she then allegedly gave the firefighter $1,387.12 in a cashier's check. The Kealohas took out a second mortgage in 2012 on the grandmother's property worth $150,000 and then “falsely certified that the information provided in support of their application was true and correct.” They have also been accused of making false claims that they were paid $2,700 in rent on a monthly basis “when in fact no such lease agreement existed and no rent or lease had been paid to them," the document states.

Federal authorities have said that some of the money was in the Kealohas possession. The papers said: “Some of these loan proceeds were then deposited into a checking account held jointly by the Kealohas." Ebersole's attorney told Newsweek that his client had no clue about the Kealohas "illegal conduct" but that he cut ties with her the moment he found out about it. The attorney, Donald Wilkerson, said: "When Katherine was first indicted is when he first became aware of the illegal conduct. He had no idea what was going on."

The court document states that Kealoha allegedly “used the fraudulently obtained loan proceeds to pay for more travel-related expenses for Ebersole". An official with the County of Hawai Fire Department told the publication that Ebersole, who was recently promoted to the post of battalion chief, has been helping respond to the ongoing Kilauea eruptions that have been taking place on the Big Island. The FBI opened an investigation in 2014 into “potential violations of federal law by Kealoha and others".

The investigation included a corruption case that involved several police officers including Katherine's husband Louis was a part of. This led to him being exposed to a lot of criticism and he stepped down as the police chief. The then-president of the Honolulu State of Hawaii Organization of Police Officers had told Hawaii Now in January: "He's our chief, we hate to see our chief leave under these terms."

According to a federal complaint that was filed in 2017, the case started after the FBI has launched a probe into the theft and conspiracy that falsely framed "G. K. P." for stealing her mailbox in 2013. The investigators from the United States Postal Inspection Service and the FBI said that a former Honolulu police officer, who had been involved, gave false statements when he was investigating the mailbox case and made criminal charges against "G. K. P." that was not true. 

This is when the feds started looking into the deputy prosecutor for her suspicious purchases, that included two more flight tickets for Ebersole from Hilo to Honolulu in August and November 2017, as well as two separate stays at hotels around the same time. Ebersole had been asked to appear in front of a federal grand jury in a separate case where Kealoha was a "purported victim". According to the documents, the court had wanted to know “how Kealoha had used the funds misappropriated from F.P. [and] “fraudulently obtained” when she took out a second mortgage". The document added that both Ebersole and Kealoha "did knowingly and voluntarily agree with each other, and with others, to corruptly obstruct, influence, and impede an official proceeding…”

The document stated that the deputy prosecutor even prepared Ebersole to be a witness before the grand jury took place. The papers said: “...Kealoha would arrange to meet with Ebersole prior to his testimony before the grand jury, and would coach Ebersole on how to falsely respond to questions posed to him in the grand jury". This stretches as far back as a year ago when federal prosecutors claimed that Kealoha was still trying to sabotage the investigation by talking to Ebersole directly or through third parties in which the two of them “discussed Kealoha’s desire that Ebersole continues to deceive the Federal grand jury about the true nature of their relationship.”

Ebersole then allegedly “testified falsely about several aspects of his relationship with Kealoha” about their romance or “the financial benefits Kealoha provided to him,” on April 20, 2017, according to the court documents. He had to appear before a grand jury because of this on May 18 and the federal prosecutors alleged that he “refused to produce documents and answer questions." A US Attorney's Office official confirmed that he will appear in court again on July 12 to make a plea to the conspiracy charge. 

Wilkerson, the firefighter's attorney, said that his client regrets what happened and also said that the affair with Kealoha "has long been over". He said: "He is ashamed of himself for getting involved with Katerine Kealoha. She has really gotten a lot of people involved in her shenanigans and she should own up and take responsibility for what's she's done."