Saipan Correspondent

At the July 28 meeting of the Commonwealth Casino Commission were (from left) Ian Morrell, acting executive director of the commission; Su Hongtao, representative of Imperial Pacific International Holdings; Tao Xing, authorized representative of Imperial Pacific International (CNMI); and Thelma Mizer, enforcement and investigation manager of the commission.
Photo by Mark Rabago

GULAO RAI — A representative from Best Sunshine International Ltd. and Imperial Pacific International (CNMI) LLC’s parent company said at the July 28 Commonwealth Casino Commission’s monthly meet that they’re about ready to move on from IH Group after the South Korean investor remitted only a portion of the promised $150 million it was supposed to infuse to the embattled Saipan casino.

Imperial Pacific International Holdings representative Su Hongtao, through interpreter Tao Xing, said IH Group hasn’t responded to the company’s repeated requests to fulfill its investment agreement.

“They’ve been late in terms of a payment schedule according to the agreement signed … IPI has demonstrated great flexibility in terms of the payment, however, we’re giving them the final notice,” he said during the July 28 Commonwealth Casino Commission monthly meeting at the casino regulator’s office in Gualo Rai.

IH Group Chairman Kyunam Kim was expected to fly to Saipan July 27 to attend the meeting the next day. His presence was supposed to reassure the commission of the company’s promised investment in IPI, but he was a no-show. Sources said he had a family emergency.

To date, only $245,000 has been remitted by IH Group to IPI.

Su also agreed with the commission that the holdup on the remittance of the promised $150 million is a source of concern and in fact the main reason why IPI’s settlement agreement with CCC hasn’t gained any ground.

“[If] IH Group does not pay according to the agreement we will terminate that (agreement),” he said.

Su is the designated representative of IPI Holdings and presented a letter from Chen Feng, the Hong Kong-based company’s executive director, to the CCC to prove that he’s authorized to speak on behalf of the conglomerate.

IPI has been counting on the $150-million investment from IH Group to settle its arrears with CCC.

In its filing to revoke IPI’s exclusive Saipan casino license, the commission said IPI has failed to pay $18.65 million for the Casino Regulatory Fee and Annual License Fee due for 2020 and assessed penalties in the amount of $6.6 million.

CCC said IPI has also failed to pay another $18.65 million for the Casino Regulatory Fee and Annual License Fee due for 2021 and it will seek additional penalties. Similar amounts for 2022 are due in the coming months, according to the casino regulator.

CCC recently filed its opposition to IPI’s motion for a temporary restraining order and preliminary injunction for the revocation of its exclusive casino license with the U.S. District Court for the NMI, citing CCC and IPI’s failure to execute a settlement agreement by July 18.

CCC’s two lawyers — assistant attorneys general Keisha Blaise and Alison Nelson — said nearly two months has passed since IPI filed its motion and there’s no evidence that the $150-million investment expected by IPI has been made. In fact, the two said it’s uncertain when it will be made — or whether it will be made at all.

During the CCC meeting, Blaise said she’ll only believe that IH Group has invested in IPI once there’s a signed agreement between the two parties, when asked by CCC Commissioner Ralph Demapan if they have any knowledge about the agreement between IPI and IH Group.

With the $150 million investment nowhere in sight, the commissioners asked acting executive director Ian Morell the status of the CCC’s own settlement agreement with IPI. “As of right now there’s no settlement agreement. No signings. … It just keeps going back and forth. They keep making changes that we don’t agree with,” he said.

Prior to IPI representative Su speaking before CCC during the public comments section, Vincent Aldan spoke as a concerned citizen about his misgivings as to IH’s Group legitimacy as a company.

Aldan, who worked as a facility manager from 2017 to 2019 and as a safety consultant in 2020 for IPI, said after his own investigation he found out that IH Group falsely claimed on its website that it built a waterpark, a shopping mall, and a 30-room hotel on Rota.

He also said that IH Group claimed that it helped renovate the Rota International Airport and that it has a Duty Free Saipan store there.

“This IH Group is exactly like IPI, it’s a scam. There’s no money… I’m pretty sure that we’re just kicking this can down the road, and I’m not sure what’s gonna happen at the court. But what I do know is that this IH Group is a scam…”

Aldan also shared his ire toward his former employer and said whoever is planning to put down hundreds of millions of dollars to revitalize the Imperial Pacific Resort is making a huge mistake.

Of IPI’s stated plans, he said, “There is no way that hotel will be open and operational in November.” He criticized the condition the condition of the infrastructure. “It’ll take millions and millions and millions of dollars that they don’t have to fix it. The rooms they’re full of mold, [there’s] safety issues, their sewage pumps don’t work. Their transformers burnt up,” he said.

Imperial Pacific International LLC opened its Imperial Pacific Resort Hotel Saipan on July 6, 2017. The gaming area featured more than 70 gaming tables and more than 190 electronic gaming machines.
Photo by Mark Rabago

Aldan added that no contractor on Saipan would even work for IPI again.

“Nobody’s willing to do any kind of work for IPI. Why? Because IPI has already made that … reputation that they’re not trustworthy.”

His advice to IPI was to pack up and leave.

Su took offense to Aldan’s eviscerating public comments about IPI and Imperial Pacific Resort and, through Tao, reminded the CCC of the contributions IPI made to the NMI community through the years.

He said since 2014, IPI’s cumulative investment in the CNMI has exceeded $1 billion.

“The project provided business opportunities to hundreds of local suppliers, and CNMI GDP growth was 3.5% in 2015, 28.3% in 2016 and 25.6% in 2017.”

Since 2014 IPI has created more than 2,000 employment opportunities, Su said.“IPI helped create the new industry from scratch. [It] attracted and trained hundreds of gaming talents for the CNMI.” Moreover, the IPI representative said the Saipan casino contributed more than $300 million to the CNMI government’s coffers.

“In 2015, $16,280,000 in licenses and fees were paid. In 2016, $35,601,000 in taxes and $15,934,000 in licenses and fees; in 2017, $70,483,000 in taxes and $16,244,382 in licenses and fees. In 2018, taxes were $46,349,000, licenses and fees were $16,391,000.”

 He said IPI also contributed to community and environmental protection that included hundreds of community reconstruction, clean-up and beautification activities, and the community donation of more than $6 million. On the cultural side, he said IPI’s promotion of CNMI included nearly 100 international promotion events, among them are the CNMI International Film Festival, International Business Forums, film and TV series shootings and international golf competitions.

Best Sunshine and IPI filed their motion for preliminary injunction in Superior Court eight months after CCC executive director Andrew Yeom filed five enforcement actions against IPI and more than a year after the commission ordered that IPI’s license was suspended indefinitely, after two evidentiary hearings. mbj