Last May, Environment Hawai`i<\/i> reported on the strange case of Venu Pasupuleti, a would-be wheeler-dealer from Ohio who was proposing to build a huge (4,000-employee) computing center on land owned by the state Natural Energy Laboratory of Hawai`i Authority (NELHA) in Kona.<\/p>\n
\tIn an illegal meeting in April, the NELHA board had actually approved Pasupuleti\u2019s plan, but, when the meeting had to be redone (to meet state public notice requirements), the board backed off, granting approval to a scaled-back plan on condition that Pasupuleti post a large bond and show he had resolved IRS liens on several of his failed companies in Ohio, among other things.<\/p>\n
\tSince then, Pasupuleti has been arrested — not once, but twice. According to a spokesperson for the Hawai`i County Police Department, on July 9, he was arrested for first-degree theft. Two days later, he was arrested and charged with failure to return a rental car.<\/p>\n
\tUday Sinha of Ohio, hired last year by Pasupuleti to work at his Hawai`i company, called Megasoft, told Environment Hawai`i<\/i> that Pasupuleti was continuing to attempt to drum up support in Honolulu for his project. Sinha, who left a secure, $93,000-a-year job on Pasupuleti\u2019s promise to pay him $170,000 a year, has since become disillusioned with Pasupuleti. Not only did he not receive any money from Pasupuleti (who promised payment would be forthcoming as soon as a committed investor ponied up), he is out more than $6,000 that he gave as a loan to Pasupuleti, plus all his travel expenses for two trips to the islands.<\/p>\n
\tAccording to Sinha, Pasupuleti was telling prospective investors that the NELHA board had approved his project and the only bump standing between him and breaking ground was NELHA director Ron Baird\u2019s delay in signing the papers. To beef up his claims, Sinha said, Pasupuleti proudly showed prospective investors and employees (including Sinha) an article published last April in The Honolulu Advertiser.<\/i> The article, by Sean Hao, stated that the NELHA board had given approval to Pasupuleti\u2019s request for a lease on 10 acres of NELHA land. (As stated earlier, that approval, at the illegal board meeting, was later amended with far more stringent \u2013 and as yet unmet \u2013 conditions.) Hao gave lots of play to Pasupuleti\u2019s description of his business plan and anticipated revenues.<\/p>\n
\tPasupuleti reportedly told Sinha that the arrest on the rental-car charge was the result of a misunderstanding; he\u2019d told the rental car company where to find the car, but they didn\u2019t pick it up, Pasupuleti told him. The first-degree theft charge apparently is the result of Pasupuleti not paying his bill at the Hilton Waikoloa Hotel, where he had rented 20 or so rooms in the name of his company. That charge has been referred to the county prosecutor\u2019s office, where it is pending.<\/p>\n
The Defrauded Innkeeper<\/b><\/i>
\nLast May, Sinha came to Hawai`i and met with Pasupuleti at the Hilton Waikoloa in one of several rooms Pasupuleti had rented to use as temporary offices for his business. At that time, Sinha said, Pasupuleti seemed to be on the up-and-up. He observed what seemed to be a telephone conference between Pasupuleti and a person who Pasupuleti said was with AT&T, with the discussion centering on providing routers and other internet service equipment.<\/p>\n
\tWhen Sinha returned to Hawai`i in July, he was told by a student who had become a close confidante of Pasupuleti that they couldn\u2019t go back to the Hilton and that Pasupuleti himself was in jail. Sinha had to put up his own credit card to secure a room at another hotel.<\/p>\n
\tA source in the credit department at the Hilton Waikoloa confirmed that it was his hotel that was scammed by Pasupuleti, leading to the charges of defrauding an innkeeper. \u201cI can\u2019t tell you the exact amount,\u201d he said, but he said it was \u201ca rather substantial amount of money.\u201d Sinha had told Environment Hawai`i<\/i> that the unpaid bill, for some 20 rooms that Pasupuleti had booked on behalf of Megasoft, came to roughly $160,000. The Hilton source acknowledged that Pasupuleti had booked a number of rooms for his corporation, \u201cwhich failed to materialize due to, what I understand was, various red tape issues with the governor\u2019s office in getting proper clearances and subleases.\u201d When asked if the amount of the unpaid bill approached the $160,000 figure Sinha provided, the source said: \u201cIt was over $150,000 \u2013 maybe even more than $160,000.\u201d<\/p>\n
\t\u201cOne thing I can tell you,\u201d he said, \u201che was very convincing, and was always very positive that he was receiving funding \u2018at any time\u2019 \u2013 always \u2018at any time.\u2019 Unfortunately, we can\u2019t do business on promises. Originally, he presented some letters of credit, et cetera, that were supposed to be security.\u201d<\/p>\n
\t\u201cHe shouldn\u2019t have got into us as deep as he did,\u201d he continued. But owing to a series of crossed communications and other problems, Pasupuleti continued to occupy a number of rooms that, day after day, remained unoccupied. \u201cThe maids didn\u2019t report them vacant,\u201d he said, \u201cbecause for them it was one less room to clean.\u201d<\/p>\n
\tMegasoft \u201chad all these rooms and were running up the bill for several weeks and nobody was telling anybody else,\u201d he said. \u201cThey were all empty.\u201d<\/p>\n
An Unpaid UH Grant<\/b><\/i>
\nIn late 2006, Pasupuleti signed a contract with the University of Hawai`i, agreeing to pay $450,000 over the next three years to the College of Business Administration. The grant was to support research into \u201cthe emergent behavior of \u2018ultra-large-scale,\u2019 or ULS, systems from both computational and managerial perspectives,\u201d as described in a write-up of the grant published in the college\u2019s newsletter. Principal investigators were Rick Kazman and Hong-Mei Chen.<\/p>\n
\t\u201cI never received a dime\u201d on the grant, Kazman told Environment Hawai`i,<\/i> adding that he was \u201cgetting some flack from my college for not coming through with the promised funds.\u201d<\/p>\n
\u201cHe fooled me,\u201d Kazman said of Pasupuleti.<\/p>\n
\tBrokering the grant was a graduate student of Kazman\u2019s who had met Pasupuleti last winter at a cultural gathering. That student now rues the day he met Pasupuleti, he said in an interview with Environment Hawai`i.<\/i> (He did not want to be identified.)<\/p>\n
\t\u201cI got in trouble because I introduced him to people,\u201d the student said. \u201cHe ruined my relations with so many people.\u201d According to the student, Pasupuleti had put more than $10,000 on the student\u2019s charge card without authorization. When Pasupuleti wrote a check to cover part of the amount, the student said, it bounced. \u201cHe told me there was some fund management that needed to be done,\u201d the student said, \u201cand told me to be patient.\u201d<\/p>\n
\t\u201cI thought this was all real,\u201d he said, referring to Pasupuleti\u2019s grand plans. However, he added, for months now, Pasupuleti has not returned his calls or emails. In an effort to recover the funds he claims he is owed, in mid-January, the student filed a complaint in small claims court against Pasupuleti and his brother, Vijay, who lives in Ohio. Vijay Pasupuleti, the student said, has assisted his brother in his schemes.<\/p>\n
\tEnvironment Hawai`i<\/i> was able to confirm the identities of several other parties who were apparently stung by Pasupuleti. None wished to discuss their involvement with him or be publicy identified. They include an attorney, a public relations firm, and a California computer consultant.<\/p>\n
And NELHA Waits<\/b><\/i>
\nAs for Pasupuleti\u2019s compliance with terms set by the NELHA board for occupying its site, deputy attorney general Bryan Yee told Environment Hawai`i<\/i> that he had heard virtually nothing from Pasupuleti since the board took action last spring.<\/p>\n
\tSo where is Pasupuleti these days?<\/p>\n
\tIn Honolulu, where, according to Sinha, he is trying to sell investors on a scheme to develop a computing center on O`ahu. In late December, the receptionist at the Atkinson YMCA confirmed that Pasupuleti was staying there, in a $37-a-night room (with shower down the hall).<\/p>\n
\tDespite his humble lodgings, Pasupuleti continues to swan about Honolulu, frequenting the watering holes of its movers and shakers. A recent newsletter of the Island Club welcomes him to its ranks. Just to join this exclusive group requires prior membership in the Plaza Club, the Waikiki Yacht Club, or the Mid-Pacific Country Club.<\/p>\n
\tEfforts to obtain comment from Pasupuleti were unsuccessful by press time.<\/p>\n
On the Web:<\/b><\/p>\n
For more on Megasoft, NELHA, and Pasupuleti, see the articles in the May 2007 issue of Environment Hawai`i,<\/i> plus the EH-Xtra entry (in the EH-Xtra archives). All can be accessed from our home page, [url=https:\/\/environment-hawaii.org]www.environment-hawaii.org[\/url] EH-Xtra articles may be viewed for free. Access to archived articles requires a current subscription or purchase, for $10, of a two-day pass.<\/p>\n
The Honolulu Advertiser<\/i> article is available on the newspaper\u2019s website archives for April 19, 2007: [url=http:\/\/the.honoluluadvertiser.com\/article\/2007\/Apr\/19\/bz\/FP704190348.html]http:\/\/the.honoluluadvertiser.com\/article\/2007\/Apr\/19\/bz\/FP704190348.html[\/url]<\/p>\n
— Patricia Tummons<\/p>\n
Volume 18, Number 8 February 2008<\/p>\n","protected":false},"excerpt":{"rendered":"
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