Former Damien president files whistleblower lawsuit

CRAIG T. KOJIMA / 2018 Arnold Laanui Jr., an attorney, Damien alum and former special agent with the Federal Bureau of Investigation, filed the whistleblower lawsuit Friday in Oahu Circuit Court.

CRAIG T. KOJIMA / 2018 Arnold Laanui Jr., an attorney, Damien alum and former special agent with the Federal Bureau of Investigation, filed the whistleblower lawsuit Friday in Oahu Circuit Court.

The former president of Damien Memorial School has filed a lawsuit accusing the institution of firing him for uncovering alleged illegal financial management, failure to pay taxes, a football player sex scandal and payments to players from alumni.

Arnold Laanui Jr., an attorney, Damien alum and former special agent with the Federal Bureau of Investigation, filed the whistleblower lawsuit Friday in Oahu Circuit Court.

Laanui was hired July 1, 2022, on a three-year contract, and said that during his tenure he “witnessed several suspected violations of law which he reported to the Damien Board and the Christian Brothers, including but not limited to : group sex on campus involving a minor ; fraud ; violations of Title IX and Interscholastic League of Honolulu recruiting rules ; and embezzlement, ” the complaint alleges.

The complaint targets The Congregation of Christian Brothers of Hawaii Inc., doing business as Damien Memorial School, for “wrongfully terminating his employment in retaliation for complaining about violations of law.”

On Monday, Stephen Guzman, Damien Memorial School’s director of communications and marketing, declined comment on Laanui’s allegations.

Laanui, who also holds an education doctorate from the University of Southern California, retired from the FBI in 2019 after 25 years with the U.S. Department of Justice. He is a member of Damien’s class of 1986.

He took a series of jobs with the state Department of Education before Damien asked him whether he would be interested in leading his alma mater.

Laanui told the Honolulu Star-Advertiser in an interview that shortly after he became school president, he asked for a profit-and-loss statement and other basic financial metrics.

“The very first hint that something was awry was maybe after my first month there. I was asking for P &L statements … real basic business acid test, just to see where we were at. And I couldn’t get it, ” said Laanui, noting the last audit of the school’s finances had been done in 2019.

Laanui said as president he tried to clean up what he called a culture of corruption, hiring an auditor and performing internal reviews, until he was let go in February.

Damien was founded in part on the premise that it would help poor kids get an education.

“I’m well accustomed to standing up and doing the right thing. These are a bunch of guys who went wayward and did not realize they were corrupted along their way. It’s a community that has lost its way, ” said Laanui.

He said he hopes the lawsuit will prompt the school to publicly disclose those who he alleges have broken the law and school policies before taking corrective action.

“We had discussions with Damien’s attorney before the lawsuit was filed, but it became clear that the school is not interested in resolving the matter or ensuring that this conduct is addressed and not swept under the rug, ” said Leighton M. Hara of Ota & Hara LLLC, Laanui’s attorneys. “Hawaii’s whistleblower protection laws are there for a reason, to protect individuals from retaliation when they do the right thing and report violations of law. Damien’s conduct is exactly what these laws were meant to stop.”

Laanui said he told the board of directors about his claims of financial irregularities, and members were “shocked by it.”

He said he discovered that “tens of thousands of dollars ” in money raised by the Damien Alumni Association, a nonprofit not registered with the Internal Revenue Service, were not being used the way the fundraisers pitched it.

Money raised by alumni, purportedly to support female and male student athletes, for years was “all going to football players ” in the form of tuition payments, Laanui alleges.

Laanui said he uncovered and documented violations of Title IX and ILH rules where “Damien through the DAA and football coach ” solicited football players by “providing them with scholarships ” in violation of ILH recruitment rules prohibiting pay-to-play activities.

Additionally, Laanui said he found “attempted embezzlement ” by the varsity and intermediate football coaches where they “falsely submitted a $6, 000 invoice for a football banquet, ” but “instead, they were going to pocket the money as an unauthorized cash bonus.”

Head football coach Anthony Tuitele and another coach, Ron Dalmacio, filed a lawsuit after they were fired but dropped it and were reinstated in February, the same month the school fired Laanui.

ILH officials did not respond to Star-Advertiser requests for comment.

Damien was in “poor fiscal health, ” and Laanui said he made “tough decisions ” to improve Damien’s financial well-being, according to the civil complaint.

Auditors described the system Laanui inherited as having “significant material weaknesses ” regarding Damien’s internal controls, the complaint continued, and the school was not cooperating with the work of auditors hired to ensure its financial compliance.

Laanui claims that in February 2023 he was told by the school’s athletic director that Tuitele tried to cover up “an on-campus sex incident involving minor students that occurred during a Damien sanctioned football sleepover in October 2022.”

Five students, four football team members and a female equipment manager “engaged in group sex during the sleepover on Damien’s campus, ” he alleges.

Laanui said he told the school’s board of directors that the “conduct may be criminal because the girl involved was a minor and incapable of consent.” Damien could be in “violation of the law because the lax supervision by Damien staff allowed for the sexual activity involving minors to occur, ” according to the complaint.

The complaint also details more than 40 years of the school’s history of handling sexual misconduct complaints because “Damien has a duty to guard against sexual abuse on campus and should have a heightened awareness for identifying and preventing all forms of sexual abuse.”

“Damien is aware of numerous cases of sexual abuse against former clergy /teachers and have settled the matters through monetary payments, ” according to the complaint.

In 2013, the first year Damien admitted girls, a male wrestler allegedly sexually abused a female student on the Damien campus, which prompted a lawsuit.

Damien resolved that lawsuit, also, according to the complaint.

In January 2019, Brother Brian M. Walsh from the Christian Brothers was hired to helm the school, three years after he signed a “$1.9 million settlement with 21 student victims who were abused at Bergen Catholic High School (in New Jersey ) between 1963 and 1978, when Brother Walsh was president, ” read the complaint.

In June 2020, Damien announced that Walsh would not return and that an interim president, Kyle Ataby, would run the school. Laanui was hired July 1, 2022.

“The hardest thing … I know I’m going against my family here. My family is doing wrong, and I have to take a position against it. … The truth will surface … the truth will reveal itself, ” said Laanui. “The facts and the evidence and the data that I have will outweigh the fabrications. I’m pretty confident of that.”

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