The former vice chairman of the state Real Estate Commission and his wife have been indicted for allegedly embezzling more than $200,000 from two East Hawaii clients.
A Hilo grand jury on Wednesday returned separate indictments against 53-year-old Scott Alan Sherley and his 52-year-old wife, Penny T. Sherley, also known as Penny Honda. Both Sherleys, former Big Island residents who now live in Waipahu, Oahu, are charged with two counts of first-degree theft.
First-degree theft is a Class B felony punishable by up to 10 years in prison, upon conviction.
A judge set bail at $20,000 for each, and bench warrants for their arrests are being processed.
The indictments accuse the Sherleys of bilking the revocable living trust of Edward G. Pereira and Frances G. Pereira between Oct. 19, 2011, and Nov. 2, 2015, and of draining funds from the Kawili Regency condominium owners’ association.
According to police, the amount allegedly misappropriated from the Pereira trust, owner of Pereira Apartments, was $135,633, and the amount allegedly taken from the Kawili Regency condo association was $80,000.
“Frances Pereira is 92 years old, and her husband, Edward Pereira, died in 2014 at an advanced age,” Deputy Prosecutor Rick Damerville said Thursday. He declined to further comment on the cases, except to point out the Sherleys are “innocent until found guilty in a court of law.”
Scott Sherley was the property manager for the Kawili Regency, which is at 34 E. Kawili St. in Hilo, and both apparently had management responsibilities for the Pereira Apartments, located on Lehua Street in Wainaku.
The Kawili Regency owners’ association terminated its management contract with Scott Sherley in 2016, according to a board member.
“It’s sad, because I would never have thought in a million years that he would be involved in something like that,” said Nancy Cabral, president of Day-Lum Rentals. Day-Lum is now the association manager for Kawili Regency and has helped with renovation of the Pereira Apartments, she said.
“The Sherleys had the fiduciary obligation to take care of the income and expenses of the properties,” Cabral said. “Kawili Regency condominium board and owners are recovering well and with the good economy the units are more valuable than ever. Pereira Apartments are being renovated and doing very well with a high demand for their nice studio apartments.”
Scott Sherley was a licensed real estate broker, and Penny Sherley a licensed real estate salesperson. According to the state Department of Commerce and Consumer Affairs website, both forfeited their licenses in 2016. The website also indicates there are two pending complaints against the couple and a third against Scott Sherley.
In addition, Scott Sherley was the Hawaii Island member of the state Real Estate Commission from 2010. He was the commission’s vice chairman when he apparently stepped down following a monthly meeting of the regulatory body Aug. 26, 2016.
He’s described as a real estate educator in several locations online, and his Facebook page describes him as “Instructor/Provider/Owner at REAL Class INC.”
REAL Class has its own Facebook page that advertises an “early bird special” for a 2018 class.
The company’s Facebook page says REAL Class is “Providing Education &Training throughout the State of Hawaii, specializing in topics on Fair Housing, Property Management, Condominium Ownership, Americans with Disabilities Act and Service Animals.”
In a 27-minute YouTube video, Scott Sherley addresses “Medical Marijuana, The Law and Your Condo.”
He also started a page on the legal crowdfunding website Funded Justice titled “Please Help The Sherley’s (sic) Raise Legal Funds.”
The crowdfunding page states a goal of $10,000 and, as of Thursday, indicated $5,515 has been raised from 43 contributors in a 47-week period.
“After 31 years of helping the real estate industry and agents and the Hawaii community, and asking for nothing in return for myself, and never having a complaint filed or action made against me in all those years. Now I need help defending myself,” Sherley wrote on the fundraising page.
A phone message left for Scott Sherley early Thursday afternoon wasn’t returned by press time.
Email John Burnett at jburnett@hawaiitribune-herald.com.