Makani Kekoa Statement Flashcards
1
My name is Makani Kekoa, and I am a detective with the harmony police department, specializing in white collar crime. I have held this position for eight years. Prior to becoming a detective, I was a patrol officer with the Harmony PD for five years, which is the minimum amount of time required before you can take the examination to become a detective. I was recommended for the detective’s position by my supervisor, due to my unique educational background. Before becoming a patrol officer, I attended Buckeye University, where I majored in both accounting and criminal justice. After obtaining my degree, I sat for and passed the examination to become a Certified Public Accountant. During my time as a CPA, I saw businesses with questionable financial practices and people who seemed to be looking for ways to hide money from the IRS. On once occasion, I was asked by local law enforcement to examine the books of a local business that was being investigated by the police. It was after this experience that I decided to combine my accounting expertise with my desire to serve the community as a law enforcement officer.
2
Since joining the Harmony PD, I have had additional training with the FBI in the area of forensic accounting as a part of their outreach program with local law enforcement. I was specifically chosen by Harmoney PD to participate in this joint program with the FBI due to my experience as a CPA. The FBI training was incredibly helpful because it taught me how to apply my knowledge as a CPA to the world of white collar crime. I learned how to sift through business record and not only look for discrepancies, but to notice when information was missing that your would expect to see in a typical business account. I spent time looking at sample records and reconstructing paper trails to be used in court. As a result of this training, I am the detective at the Harmony Police Department who is most qualified to investigate financial crimes.
3
During my time in the white collar crime division, I have handled my fair share of financial crime cases involving money laundering, embezzlement, tax fraud, and similar offences. It really comes down to the fact that people have no idea how easy it is to uncover these types of crimes, especially when those committing them do almost nothing to cover their tracks. More often than not, embezzlement cases involve an accountant or bookkeeper using company funds to pay off personal debt or to fund lifestyles they cannot afford. Usually, they will write company checks to personal accounts, or change the billing information on an existing invoice so that the money gets deposited in their own account rather than the vendor’s. Once our office gets tipped off, usually by a business owner who notices the missing funds, we can quickly connect the dots. This is especially true for small businesses, where only a few employees have access to the company’s finances.
4
Money laundering is a bit different. It starts with money that comes from an illegal source, such as drug trafficking or embezzlement. This is dirty money that needs to be cleaned, meaning they need to make the illegal money look legitimate. To do this, they will move the dirty money into a legitimate business by paying for a good or service that is not actually rendered. Then, the money is logged in that business as a legitimate source of income, allowing the individual to use the business profits for personal gain. Cash intensive businesses such as car washes, construction companies, or coin-operated laundromats are frequently used to launder money. CIBs are businesses that receive large amounts of payments in cash for services. CIBs are considered good vehicles for money laundering because cash is harder to trace, and it is easier to create bogus invoices for goods or services in these types of business.
5
In early 2022, I was assigned to be the lead detective on the Diallo Espinosa case. My department was alerted by the Trillium High School auditor in January 2022 that funds in the amount of exactly $80,000 were missing, and that school treasurer Ash Espinosa was also a twenty percent owner at a junkyard; her cousin, Harley Diallo, owned the outstanding eighty percent. We staked out the junkyard and noticed decreased traffic coming in and out of the junkyard and therefore, suspected that profits were low; yet the junkyard remained operational. We hypothesized that Espinosa, through Espinosa’s access to Trillium’s budget and the junkyard invoicing systems, could be laundering funds with the assistance of Diallo. After learning about the money missing from the Trillium High School account, Espinosa’s connection to the junkyard, and the potential for money laundering, I decided to double my efforts in hopes of acquiring evidence to support a search warrant application. That included tracking Espinosa and learning Espinosa’s connection.
6
In March 2022, I began conducting surveillance on Espinosa at Trillium High School in addition to our surveillance of the junkyard. Not long after, I noticed some unusual activity occurring with Ash Espinosa and Harley Diallo coming and going from the junkyard at odd hours. The two would usually talk in the open near the front gate where I could hear them with my windows down. They never saw me listening to them. As a part of my surveillance, I overheard Espinosa and Diallo discussing what sounded like a money laundering scheme. Espinosa discussed Trillium funds being transferred to the junkyard’s accounts and instructed Diallo on how much to invoice Trillium. I suspected these invoices were falsified. During my surveillance, it became clear to me that Espinosa was calling the shots. Diallo was never the once to initiate conversation about the conpsiracy, she simply followed Espinosa’s lead. Even in times when Espinosa wasn’t there, Diallo seemed hesitant to make any decision for the junkyard without calling Espinosa first. It was odd to me that the eighty percent owner was so hesistant to make these decisions without Espinosa’s buy-in.
7
I noted the presence of a 1967 Camaro being restored on the junkyard’s premises. After doing some digging on public records and registrations, I learned that it had been purchased in August 2021 for $1,000 and was titled to Ash Espinosa. For someone allegedly experiencing financial problems, this struck me as an odd purchase. I also noted shipments of parts for the Camaro being brought to the junkyard. During the course of my investigation, I learned that the parts purchased totaled only approximately $5,000. I never saw the Camaro operational and have no reason to believe that it was restored to a working condition.
8
In April 2022, I noted one instance of a known criminal conferring with Diallo and Espinosa. The individual is known as “Bargain Buddy” but goes by various aliases. Buddy is engaged in cash-based criminal enterprises, such as drug trafficking. Buddy has not been arrested due to the prosecutor’s desire to build the strongest case possible against him before his arrest. I was close enough to hear the conversation between Diallo, Espinosa, and Buddy the single time I noted his presence. I appeared to me that Diallo introduced Buddy to Espinosa. Espinosa, Diallo, and Buddy talked for some time about personal topics. Towards the end of the conversation, Espinosa broke a period of silence by asking Buddy is she and Diallo could “help” Buddy with anything. Buddy said, I remember clearly, “Now that you mention it, I do have some cash I need clearned, if you know what I mean.” Espinosa nodded, looked at Diallo, and said, “What do you think?” Diallo responded, “For a price, we can make that happen.” Buddy agreed to compensate Espinosa and Diallo twenty percent of the laundered funds. All three shook hands and the conversation ended. After this conversation, I noted increased traffic of vehicles coming and going from the junkyard. These vehicles did not leave with junked car parts and some of the vehicles were registered to individuals with contacts with police for suspected drug trafficking and similar offenses.
9
As a result of the information gathered through surveillance, I obtained a search warrant for the junkyard, and it was served on August 12, 2022. When I arrived at the premises, Hardly Diallo was the only employee there. Oakley Ghale, who is Espinosa’s child, was also present. Ghale and Diallo asked if the officers could wait to execute the warrant until Espinosa arrived. We declined to do so. The financial books and records of the junkyard were confiscated in the search of the premises. The 1967 Camaro was also confiscated due to my belief that it had been purchased by Espinosa with laundered money. It was transported to and is currently being held in a secure lot operated by the Harmony Police Department.
10
I compared the Trillium High School records showing funds illegally taken by Ash Espinosa with the junkyard’s financial records and discovered multiple occasions where the exact amount taken from Trillium was subsequently deposited in the junkyard’s account. The first transaction of note was a $3,000 deposit made in 2020, allegedly from the sale of junked parts and scrap on the same day Espinosa had withdrawn $3,000 from the school account. This did not seem to be accounted for in the records of tracked incoming and outgoing vehicles and scrapped parts. No Vehicle Identification Numbers were recorded to track the vehicles from which the scrap and parts were supposedly obtained. A VIN is a unique identifier that is a combination of letters and numbers standardized worldwide. Manufacturers include these numbers on each vehicle, and they are used to distinguish vehicles for a wide variety of purposes ranging from state registration to insurance. Cash transactions for spare parts and scrap are not uncommon in a junkyard. Typically, however, a junkyard keeps track of the VIN for the vehicle that is used as the source for these parts. It also seemed strange to me that Trillium High School would purchase scrap metal.
11
I confirmed the transaction discrepancy with Grey Obisanya, an employee of the junkyard during the time of the alleged transactions. Obinsanya worked in the front office at the junkyard and was the main employee responsible for recording the vehicles and parts as they came in, along with the amount paid for each item. However, regarding the $3,000 in question, Ash Espinosa recorded the transaction, which was not typical of Espinosa’s duties at the junkyard. I traced other monthly withdrawals from the school account through December 2021, all of which matched up exactly with deposits into the junkyard account. I also found other unverifiable deposits into the junkyard’s account. In almost all of these instances, they were listed as cash transaction for scrap and parts with no VIN listed as the source vehicle.
12
In reviewing my findings, it became clear that Ash Espinosa had a better understanding of finances than some other criminals I have encountered in my career. As I said, most people do not bother to cover their tracks when they take money from their company. That was not the case with Espinosa; he was most sophisticated. As treasurer, Espinosa was the main person responsible for managing the school’s invoices. Anyone that has worked within a bureaucracy knows that things tend to move slowly, so invoices can remain open for months, or even years at a time. While Espinosa started out by creating fraudulent invoices for small amounts, they eventually sought our existing invoices that had not been paid. Specifically, they sought out invoices where the financial institution involved was the same financial institution (Buckeye Federal Credit Union) that Espinosa used for his personal and business accounts. On those existing invoices, Espinosa would change the routing numbers so the money would be deposited to his own accounts. This was more difficult to trace because the existing, legitamate invoice shows that money should be deposited to Buckeye Federal Credit Union, which it was. It wasn’t until we started going through the transactions in detail that we realized the Buckeye Federal Credit Union account where the money was deposited belonged to Espinosa and not the vendor listed on the invoice. To me, it seems clear that this process was used to inform the other fraudulent transactions at the junkyard. In total, I was able to track $80,000 from Trillium’s account to the junkyard’s account. I further found that each transaction totaling the $80,000 was initiated by Espinosa removing the funds from Trillium’s account.
