[Revised 9:45 a.m.]

Remember the flap during the recent legislative session over SB893? That’s the bill that would have retroactively exempted attorney/lobbyist Marvin Dang from conflict of interest provisions of the state ethics law after he lobbied on bills proposed by a mortgage foreclosure task force he had served on.

There was a big ruckus over the the bill, but in the end, after all was said and done, Dang quietly agreed to pay $1,000 to resolve any potential charges that might have been brought by the State Ethics Commission, according to the redacted summary of an advisory opinion recently made public by the commission.

Here’s what Civil Beat’s Chad Blair wrote about the issue just last month:

Two weeks ago a committee in the state House of Representatives killed a bill that would have retroactively exempted task force members from a conflict-of-interest provision in state law.

As Civil Beat reported, critics said the measure was an attempt to shield one member of the now-defunct Mortgage Foreclosure Task Force from Hawaii’s ethics law.

That member, financial services attorney Marvin Dang, turned up Tuesday before another House committee to ask lawmakers to reinstate key sections of the dead measure — Senate Bill 893 — into Senate Bill 66.

Dang submitted eight pages of written testimony and a draft of SB 893.

He also included written testimony dated March 21 from the Hawaii Bankers Association, the Mortgage Bankers Association of Hawaii, the Hawaii Credit Union League and several former members of the Mortgage Foreclosure Task Force — even though those groups and individuals were specifically testifying on SB 893, not SB 66.

The near flip-flop on the issue by the House reportedly came as Sen. Clayton Hee twisted arms behind the scenes, threatening to hold several House measures hostage if the provisions benefiting Dang were not agreed to by the House.

The issue brought former State Ethics Commission Executive Director Dan Mollway out of the closet to write a scathing letter urging the commission to fire his successor, Les Kondo.

As Star-Advertiser political writer Derrick DePledge reported:

Daniel Mollway, the former executive director of the state Ethics Commission, has urged the commission to fire Leslie Kondo, the current executive director, for allegedly operating in a “rogue and arbitrary fashion.”

In a March 27 letter to the commission, Mollway faults Kondo for publicly suggesting that a former member of a state mortgage foreclosure task force has violated the ethics law when no formal case has ever been brought before the commission.

Lots of high drama, indeed.

The issue goes back at least two years. For example, Kondo explained the ethics law to members of mortgage foreclosure task force at their meeting on August 2, 2011, according to the minutes of that meeting, and it was not the first time Kondo communicated with the task force.

The commission’s consideration of the issue came in response to Dang’s own request for an advisory opinion. In September 2012, the commission drafted an advisory opinion. The draft advisory opinion concluded that Dang’s lobbying, despite repeated warnings from commission staff, violated Section 84-14(d) of the ethics law.

No legislator or employee shall assist any person or business or act in a representative capacity for a fee or other compensation to
secure passage of a bill . . . in which he has participated or will participate as a legislator or employee[.]

The function of an advisory opinion is to provide a guideline for avoiding violations of law. If the legislator or employee who requested the opinion complies with the commission’s advice, they cannot face later charges unless they misrepresented the facts of the case. However, in this unusual case, Dang appears to have initially rejected the commission’s position and instead aggressively sought a political fix.

Meanwhile, another behind the scenes struggle was beginning in court. The ethics commission went to court in November 2012 to enforce a subpoena after Dang failed to appear and produce certain documents related to the matter, court records show.

Dang, represented by attorney Randall Y.S. Chung, filed a number of legal motions over the next several months in attempts to stave off the subpoena. The court files have been sealed and remain confidential, apparently as a result of a motion filed by Chung on Dang’s behalf, but it appears the commission’s subpoena was eventually upheld by the court.

When the attempt to get the exemption bill through the legislature finally ran out of steam, Dang apparently agreed to make a $1,000 payment “to resolve any further action by the Commission” stemming from his lobbying on the mortgage foreclosure bill.

The $1,000 payment was disclosed in footnote #1 to the commission’s Advisory Opinion 2012-2. The summary does not name Dang, but it clearly describes his case.

What remains unclear is why Dang fought so hard to avoid appearing before the commission to discuss the case, since he was evidently very active at the legislature telling his story in official testimony and in private lobbying.

There’s obviously more of a story here that remains to be pieced together.