Woman pleads guilty in school embezzlement case

  • Susie Osborne of Kua O Ka La Public Charter School. (Tribune-Herald file photo)

The former financial officer of Kua O Ka La Public Charter School admitted Tuesday to embezzling $628,835.13 from the school over a seven-year period.

Kelaukila “Ua” Estabilio, 39, of Hilo pleaded guilty in U.S. District Court in Honolulu to a single count of wire fraud — an offense that carries a potential term of imprisonment of up to 20 years and a fine of up to $250,000.

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Estabilio, who made a plea agreement with federal prosecutors, is expected to receive a lighter sentence, however. She is scheduled to be sentenced May 19 before Judge Derrick K. Watson.

Estabilio worked for the charter school — which is now in Hilo after its lower Puna campus was inundated by lava in July 2018 — from 2006 to January 2019. She was not authorized to sign the school’s checks but had access to all the school’s financial and accounting information.

“We had a very devastating and heartbreaking year with the lava and with this,” said Susie Osborne, the school’s founder and director. “This was discovered over a year ago, so we just want to stay really focused on the children and the great work that the school is doing.”

According to the plea document, from 2012 until January 2019, Estabilio “knowingly devised a scheme to defraud by taking and using funds from the school for her” and used the embezzled money “to pay for her family’s travel and other personal day-to-day expenses.”

To cover her tracks, Estabilio “made materially false representations by falsifying the school’s Quickbooks financial records,” the document states.

Osborne acknowledged that Estabilio was “somebody we really cared about, so it’s been really hard.”

According to the document, Estabilio charged her family’s and her personal expenses on her Capital One credit cards and paid the bills by wire transfers from Bank of Hawaii accounts belonging to the school and its fundraising arm, Ho‘oulu Lahui.

At least one unauthorized wire transfer occurred after the school’s campus was destroyed.

The document states a transfer of $4,225.12 was made Oct. 11, 2018, by Estabilio to pay a credit card bill.

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Estabilio also is required to make restitution to the school, and the agreement allows the feds to seize Estabilio’s assets to help recover the stolen funds.

Email John Burnett at jburnett@hawaiitribune-herald.com.

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