Former Honolulu business owner and alleged racketeering kingpin, Michael J. Miske Jr., owned a company that bought hundreds of cars at a wholesale dealers-only auction over a period of several years, allegedly using threats and intimidation to discourage rival bidders and buy cars at rock-bottom prices.
The company, Hawaii Partners LLC, was licensed as a used car dealer and registered to do business at the same Queen Street address in Kakaako that served as headquarters for Kamaaina Termite and Pest Control Inc., perhaps the largest and best known of Hawaii termite treatment firms, and the most widely recognized of Miske’s many businesses.
Kamaaina Termite is alleged to have been a central part of the “Miske Enterprise,” the name prosecutors use for the criminal organization allegedly controlled and directed by Miske from the late 1990s until his indictment and arrest in July 2020.
Kamaaina Termite “served as headquarters for the planning of criminal activities, the laundering of illicit proceeds, and the fraudulent ‘employment’ of individuals whose ‘work’ consisted of engaging in acts of violence or fraud on behalf of the Miske Enterprise,” according to the indictment handed down by a federal grand jury in June 2020.
Hawaii Partners and its motor vehicle dealer’s license, operating from the same location, was also part of the enterprise, prosecutors allege. The cars purchased at auction were allegedly used in several different ways, providing a source of income, a means of laundering drug money, and a way to reward criminal associates.
Miske and a dozen co-defendants have been charged with a range of federal crimes, including participating in a racketeering conspiracy, murder-for-hire, kidnapping, assault, armed robbery, weapons offenses, drug trafficking and bank fraud.
To date, six of the original co-defendants have pleaded guilty as part of plea agreements. They are now cooperating with prosecutors and are expected to testify against Miske and other former associates when the case goes to trial, currently scheduled to begin in April.
Setting Up Companies
Miske registered Hawaii Partners in 2011, with partners Jason Yokoyama and Richard Aqui, state business registration records show.
At the time, Yokoyama was an employee of Miske’s Kamaaina Termite and was unlikely to have the financial resources to become a financial partner with his boss.
Later, when arranging financing for the vehicle inventory from Nextgear Capital, Miske listed himself as the 100% owner of Hawaii Partners and guarantor for its vehicle inventory financing, according to an affidavit by FBI Special Agent Grant Knorr, recently unsealed by court order.
At about the same time as Hawaii Partners was formed, the same three “partners” — Miske, Yokoyama, and Aqui — formed another business, Leverage Entertainment LLC.
A month later, Yokoyama registered Leverage Inc., which opened the M Nightclub in downtown Honolulu’s Waterfront Plaza in 2012. Yokoyama held 70% of the authorized 100 shares of Leverage Inc. stock, while Miske held 20%, and Aqui held 10%, according to Honolulu Liquor Commission records.
However, in March 2015, Aqui told the commission in writing that he had never owned any shares in Leverage.
“I have had no association with the establishment since May 2011 and was purely brought on as a consultant/Manager and never had any ownership of the business,” Aqui wrote.
About the same time he was identified as the majority owner of Leverage Inc. and its M Nightclub, Yokoyama appeared in a state court hearing on Miske’s behalf, and identified himself as operations manager of Kamaaina Termite, court records show.
He later admitted in a sworn deposition that he had no experience in the nightclub business prior to becoming part of Miske’s nightclub company.
Miske had reason to conceal his control of M Nightclub. State law prohibits the granting of a liquor license to any corporation in which a convicted felon owns more than 25% of the shares. Miske had been convicted of six felonies in the mid-1990s when he was 21 years old, and his control of the company should have disqualified it from obtaining a license.
Later, after learning he was the target of a federal investigation, Miske increased attempts to hide his ownership and control of other businesses by removing his name from their list of officers or members required to be filed annually with the state’s business registration division, prosecutors allege.
On paper, control of Hawaii Partners was transferred to Delia Fabro-Miske, who had been married to Caleb Miske, Mike Miske’s late son who died in March 2016 from injuries in a high-speed crash several months earlier.
Miske is charged with several crimes related to his role in directing a murder-for-hire plot that led to the kidnapping and murder of Jonathan Fraser, Caleb’s best friend, who Mike Miske wrongly blamed for causing the accident.
There’s little in the public record about Hawaii Partners. Unlike Kamaaina Termite and Pest Control, which eagerly sought out publicity and maintained an active social media presence, Hawaii Partners appears to have stayed under the public’s radar.
The company held title to the $425,000 Boston Whaler, “Painkiller,” and a number of Yamaha jet skis used by Miske associates.
Prosecutors allege Painkiller was purchased by Miske for use in Fraser’s kidnapping and murder. The boat was seized by the FBI in August 2017 in a search for forensic evidence, but results of the search have not been publicly disclosed. Lawyers representing Hawaii Partners went to court claiming ownership of the boat and seeking its release.
But it now appears Hawaii Partners was most active as a car dealer.
Becoming A Dealer
Hawaii Partners was licensed as a motor vehicle dealer on July 1, 2011. Its U-class license authorized it to deal in used cars, or new motorcycles and scooters.
Miske was licensed as a motor vehicle salesman the following month. Yokoyama and two other Kamaaina Termite employees, Preston Kimoto and Kaulana Freitas, whose mother was Miske’s cousin, also obtained car sales licenses over the next few months.
All were indicted along with Miske, although none of the charges appear directly related to the used car business. Freitas pleaded guilty in March to having been part of Miske’s racketeering organization from at least November 2014 until June 2020, and to using a toxic chemical to attack a rival nightclub near Ala Moana Center. He is cooperating with prosecutors, and is currently free pending sentencing.
Yokoyama and Kimoto are both charged with participating in Miske’s racketeering conspiracy.
Kimoto is also charged with conspiracy to commit kidnapping for meeting with two unidentified co-conspirators who had allegedly kidnapped an accountant on Miske’s instructions, then assaulted him while holding him in their car. Kimoto is also charged with being part of Miske’s network that distributed methamphetamine, cocaine, oxycodone and marijuana.
Kimoto was released from federal custody on $50,000 bail in July.
State records show Kimoto was licensed as a pest control field representative for Oahu Termite and Pest Control in July 2019. Oahu Termite was taken over by Miske in 2016, and was operated as one of Miske’s companies.
At The Auction
Once Hawaii Partners received its motor vehicle dealer license, Miske became a regular at Mannheim Hawaii’s dealer-only auctions in Mapunapuna, according to another dealer who frequented the auctions. He asked not to be identified because he had previously been directly threatened by Miske.
Miske did all the buying, according to this source, but was often accompanied by Kimoto, Yokoyama or Miske’s half-brother, John Stancil.
“He bought a lot of junk cars, cheap,” this dealer said.
“Nobody can bid when he’s bidding. We all know him,” he said. “We’re scared.”
“One time we were both bidding on the same vehicle. He won, then he came and threatened me. His eyes were all red, like he wanted to kill me right there,” he said.
Hawaii Partners maintained a line of credit with Nextgear Capital, a company that finances auto dealers, according to a financing statement filed with the Bureau of Conveyances.
Hawaii Partners had “a financed inventory of approximately 162 vehicles valued at $1.14 million,” according to a June 2017 affidavit by FBI Special Agent Grant Knorr filed in support of a search warrant for a van registered to Hawaii Partners. The total number of used cars that passed through the company isn’t known, although some observers believe the company had as many as 250 cars registered at one time.
Hawaii Partners allegedly sold the cars, but the sales were not reported and general excise tax was not paid.
Although Miske shared the ownership of Hawaii Partners with Aqui and Yokoyama, at least according to the company’s paperwork filed with the state, he listed himself as sole owner and guarantor of the Nextgear financing, according to Knorr’s affidavit.
Where Did The Cars Go?
The vehicles purchased by Hawaii Partners were used in a number of different ways, according to court files and other sources.
Miske, family members and associates drove cars with dealer’s paper license plates, which apparently were displayed more or less permanently, according to a Hawaii Kai neighbor who observed their comings and goings.
A 1994 two-door Honda sedan that Jonathan Fraser was driving when he was allegedly kidnapped and murdered had been purchased by Miske, and was registered to Hawaii Partners, according to FBI agent Knorr’s 2017 affidavit. The car was found a week after Fraser’s disappearance, secured and locked, near the intersection of Summer Street and Kuliouou Road.
Some vehicles were allegedly used to launder the proceeds of drug sales, according to several affidavits filed by federal agents in support of search warrants, which were recently unsealed and made public by court order.
For example, according to these affidavits, one of Miske’s insiders ran a significant drug trafficking network, with proceeds from the sale of methamphetamine and other drugs generating substantial amounts of cash.
The Miske associate and confidential witness was identified only as CW-1.
According to the FBI affidavits: ”MISKE … helped CW-1 to launder the money by using the cash to purchase used vehicles on CW-1’s behalf. CW-1 would generally provide MISKE with cash from CW-1’s drug sales, and MISKE — who owned and operated a used car dealership — would eventually deliver a used vehicle to CW-1.”
Many of the cars were allegedly given to members or associates of the Miske organization, and then sold for cash in private transactions, with Miske getting a cut of the proceeds.
“If they’re selling as a private party, after you buy the car, they’re gone. You cannot go back and say you sold me a lemon, like if you bought from a dealer,” this source said. And if a buyer did complain, a couple of threats were usually enough to silence them.
Kaulana Freitas, the Kamaaina Termite employee who also had a car salesman’s license, was taken to small claims court by one unhappy buyer.
After several delays, a trial was held on March 1, 2019, and the court found in favor of the plaintiff, Jake Luedtke. The court ordered Luedtke to return the car to Freitas, who was ordered to return the $5,000 purchase price, plus $78 in fees.
“He started making threats. He was freaking me out.” — Jake Luedtke, describing his interaction with a Miske associate.
Luedtke, in a telephone interview, said he was hoping to become an Uber driver after moving to Hawaii, and saw a Prius advertised for sale on Facebook Marketplace. He said he went to see the car, and met Freitas on Queen Street in Kakaako, near the office shared by Kamaaina Termite, Hawaii Partners, and other Miske-owned businesses.
“Freitas seemed like he was friendly,” Luedtke said, and he took the Prius out on two test drives. “It seemed to run well, and it seemed like there was nothing wrong with it.”
Luedtke said he paid $5,000 in cash for the car and took it home. But when he started the car that evening, all the warning lights on the dashboard came on.
He called Freitas and explained what had happened. “It’s not working, and all the warning lights go on.”
“Really? Well, all sales are final,” Luedtke recalls Freitas telling him.
After filing a claim in small claims court, Luedtke said he and Freitas were exchanging text messages as they tried to agree on a court date.
“He started making threats,” Luedtke said. “He was freaking me out.”
After the judge ruled in his favor, Luedtke returned the car to Freitas as directed.
But Freitas never paid him back the $5,000.
As they were walking out of the court building after the trial, Freitas had a simple message.
“Good luck getting this back from me,” Freitas said as he walked away.
“He still owes me the money,” Luedtke said.
