A former employee and business partner of former Honolulu businessman Michael Miske, who federal prosecutors alleged participated in a criminal gang Miske controlled and directed, will be released from Honolulu’s Federal Detention Center and allowed to await trial in home detention at his parents’ house in Aiea, a federal judge ruled on Thursday.

Jason Yokoyama, who once served as operations manager of Miske’s Kamaaina Termite and Pest Control, and later was registered as the majority owner of the M Nightclub in downtown Honolulu’s Waterfront Plaza, will be released as soon as his parents submit a $150,000 security mortgage on their home, a GPS location monitoring system is installed in the house, and other preconditions of release are completed, including the surrender of Yokoyama’s passport.

Judge Derrick Watson issued an order at the conclusion of a Thursday morning hearing allowing Yokoyama to be released on bond. His ruling affirmed a decision last week by Magistrate Judge Kenneth Mansfield, and was a blow to prosecutors, who had immediately appealed to Watson in an attempt to block Yokoyama’s pretrial release.

Yokoyama has been behind bars since he was named in a second superseding indictment unsealed and made public on July 30. He self-surrendered in Honolulu after returning from his temporary residence in California, where he has been living near his wife’s place of employment.

He is charged with a single count of racketeering conspiracy, although prosecutors earlier disclosed lurid details of Yokoyama’s alleged role in planning the murder of 21-year old Jonathan Fraser in 2016, based on statements attributed to two unnamed cooperating witnesses. However, Yokoyama has not been charged with any substantive offense related to Fraser’s disappearance and alleged murder. Similarly, Yokoyama appears to have been identified by Miske’s former accountant as a participant in preparing false tax returns for Miske businesses, but he has not been charged with any specific financial crimes.

Yokoyama’s attorney, William Harrison, firmly denied the allegation that his client had any role in Fraser’s murder. In a telephone interview following the hearing, he called those allegations “just crazy.”

“They want to squeeze him to be a witness,” Harrison said. “But there’s no basis for him to be a witness. He didn’t witness anything.”

Judge: No Flight Risk

Prosecutors argued in their motion, and again before Watson, that Yokoyama is a flight risk because of what they said is his proven access to substantial amounts of money. As evidence, they pointed to Yokoyama’s purchase of yellow 2014 Lamborghini Gallardo sports car in November 2015 for $227,118.

Yokoyama paid a total of $80,000, including his down payment and monthly payments, until defaulting on the loan after January 2018, prosecutors said.

Court records show the car was repossessed and Yokoyama sued for the outstanding balance, resulting in a judgment against him in the amount of $149,914.76 plus post-judgment interest.

Despite the default and repossession, prosecutors said the purchase was evidence Yokoyama had access to amounts of money “we don’t see in a typical case.”

Assistant U.S. Attorney Mark Inciong, who appeared for the government, said in his years of practice, he had not seen another defendant with the ability to buy a Lamborghini.

But Watson said the Lamborghini was largely irrelevant.

“Much is made of the Lamborghini in the government’s papers,” Watson said. “But as far as this guy is concerned, he purchased it in 2015 and defaulted in 2017, so what relevance does this have to his financial status in 2021?”

“In 2017, he clearly didn’t have the financial wherewithal to continue making payments. We are now 4-1/2 years past that,” Watson said. “Maybe it’s a sexy fact to bring up, but in September 2021, it seems to have very little relevance.”

Prosecutors said additional evidence for their view that Yokoyama had access to substantial funds came from his appointment as trustee for Miske’s revocable living trust, which was first created in 2008 and restated in 2016. At each of those times, Miske listed Yokoyama as his first pick to serve as successor trustee, according to the government’s motion to revoke Mansfield’s order.

“Of all the people in the world, Miske made Yokoyama his first trustee,” Inciong told the court.

“The whole point the government is raising is the regard defendant Miske placed in Mr. Yokoyama, how much he valued him,” Inciong said. “It was to show the relationship, how close he is with Mr. Miske,” which could then enable him to access Miske’s resources, seen as key to  being considered a flight risk.

But Watson probed further. “What are the conditions for him (Yokoyama) succeeding as trustee?”

Selected pages of the trust, which were filed in court as attachments to the prosecution’s motion to revoke Yokoyama’s release order, provide that Yokoyama, or any other successor trustee, would only take control if the primary trustee resigned, was incapacitated, or died. The trust documents also make clear that Miske is the sole trustee of his own trust, undercutting the prosecution argument.

Watson quickly shot down another prosecution view that several pedestrian border crossings Yokoyama made to Tijuana, Mexico, in 2019 and 2020 were evidence he was a flight risk, which if proven would be grounds for his continued detention.

“What is the government’s assessment of why he was crossing the border in that period?” Watson asked Inciong, who had suggested it was not for vacationing.

Inciong paused before answering. “I don’t have any supportive evidence as to what he was doing,” he replied.

“The proof is in the pudding,” Harrison, Yokoyama’s attorney, told the court. Yokoyama knew he was under investigation since receiving a target letter from a federal grand jury a year ago, Harrison said. But he didn’t try to flee, and instead returned to Honolulu immediately after being notified of his indictment.

“He came back on his own dime,” Harrison said.

Judge Watson agreed. “The facts show Mr. Yokoyama received a target letter something like a year ago. He had lots of opportunity, living on the mainland and in proximity to the Tijuana border crossing. He could have run. He did not,” Watson said in explaining his decision.

Similarly, Watson noted, during this same period of time, Yokoyama was a successor trustee on Miske’ s trust.

“If that role allowed him to access Mr. Miske’s resources, he had that opportunity as well during this period,” Watson noted, but there is no allegation or indication he did so.

Accordingly, Watson denied the government’s motion to keep Yokoyama at the Federal Detention Center, and reaffirmed the conditions recommended by a pretrial services report and approved by Judge Mansfield last week.

Watson said the conditions, including GPS monitoring, address any flight risk that might remain.

“The property bond is not a guarantee,” Watson said, “but we are not in the business of guarantees. That’s not the standard, that’s not required. If it were, every defendant who is charged would have to be detained.”

“Mr. Yokoyama, you are on a very short leash,” Watson said to the defendant. “If there are any release violations brought to my attention, they could have very serious consequences, including your immediate detention, in addition to putting your parents in jeopardy.”

Another Defendant Failed To Get Out Of Jail

Last week, Magistrate Judge Mansfield considered a similar bid for release on bail pending trial by another Miske co-defendant, and ruled continued detention was appropriate.

Mansfield took less than 13 minutes to deny that motion for release, and order John Stancil, Miske’s half-brother, to be returned to detention.

Stancil has been held at the Federal Detention Center since his arrest in July 2020. He faces 11 charges, including racketeering conspiracy, murder-for-hire conspiracy, attempted murder in aid of racketeering and drug trafficking.

Three of these offenses are now identified as “special sentencing factors” which, if any one results in Stancil’s conviction, increases the maximum sentence for racketeering conspiracy from 20 years to life in prison.

Stancil’s attorney, Walter J. Rodby, portrayed Stancil as a hard working man and lifelong resident of Hawaii with a 2-year old son, a strong employment history, and supportive parents willing to risk $200,000 of their home equity to guarantee his bond, as well as offering him a place to live if released.

In addition, Rodby reminded the court that nothing incriminating had been found when Stancil was arrested last summer in a pre-dawn raid at his home.

“Government agents were able to go through his personal belongings, everything in his house was sifted through,” Rodby said. “And what was found? Nothing. No guns, no drugs, no evidence of illegal activity.”

“We are asking, if necessary, place him under house arrest with his mom, who needs help after his father suffered a stroke,” Rodby said.

“We just ask you to give him a chance to be reunited with his family,” Rodby said. “He knows what the rules are, and he can follow them.”

Inciong, the assistant U.S. Attorney, however, said the addition of the three special sentencing factors included in the second superseding indictment unsealed in July, provided the only new consideration since Stancil’s initial detention hearing.

“That is a significant change since this Court’s July 23, 2020 Detention Order and one that only increases the necessity of Stancil’s continued detention based on both risk of flight and danger to the community,” Inciong told the court.

Mansfield agreed with the government’s position.

“There is nothing new before me that helps your client’s argument,” the judge told Rodby before denying the motion and ordering Stancil held in detention until trial.

There were 11 defendants named in the July 2020 indictment, including Miske, Stancil and nine others. Two of those defendants have already pleaded guilty and are cooperating with prosecutors. Two additional defendants, including Yokoyama, were added by July’s second superseding indictment.

Two defendants, Preston Kimoto and Michael Buntenbah, have previously been released on bond pending trial, and Hunter Wilson, who has pleaded guilty, is free pending sentencing.

This week, Rodby filed a motion to withdraw as Stancil’s attorney.

In a declaration filed in court on Thursday, Rodby said he had been retained last year by Stancil’s parents, Deena and Michael Stancil, to serve as John Stancil’s private counsel.

“However, they are unable to continue financing said representation,” Rodby stated, triggering his request to withdraw.

Rodby said Stancil submitted an Affidavit of Indigency last year, which should qualify him to have a court appointed attorney assigned to represent him.