Legal action threatened
Saipan casino operator Imperial Pacific International, which has a monopoly on gaming in the Commonwealth of the Northern Mariana Islands, is not only refuting speculation that it could go bankrupt—it’s promised to bring legal action against those spreading the rumor.
On November 9, IPI issued a statement saying “a rumor is circulating on social media about a senior executive of IPI and the financial status of the company. The rumor is completely baseless and untrue. If in fact IPI had or will be initiating bankruptcy proceedings, an announcement with the Hong Kong Stock Exchange would have been made.”
The statement continued that “the rumor of the bankruptcy proceeding is completely false” and the company will take “legal action against the original online source spreading slanderous fake news.” IPI did not identify the supposed culprits.
The indignant response followed closely on the heels of an announcement that IPI would try to raise $38.3 million via a bond placement to fund “general corporate purposes,” CalvinAyre.com noted. That announcement followed IPI’s revelation in August that its profits had bottomed out, dropping 91.3 percent in the first half of 2018.
According to an October report in the Macau Daily Times, at the end of June IPI had almost 8 billion Hong Kong dollars (USD1.02 billion) in uncollected debt, “more than Macau casinos that cater to the highest of high rollers.”
There’s been a mass exodus of executives from the company as well. Marco Teng, a former HR manager who was serving as chairman, resigned in August, followed by Cai Lingli, a senior executive and board director. Earlier this month, CEO Henry Cheang resigned; he held the position for less than a year, and replaced yet another CEO who departed, former Donald Trump protégé Mark Brown. Brown recently announced he would return in the role of interim chairman.
The company and its lavish, still-unfinished resort have raised concerns for other reasons, including the use of illegal foreign workers, which led to an FBI probe; the inability to make payroll on time; and failure to complete the 340-room casino hotel per the deadline. IPI claimed a shortage of qualified workers as one reason for the construction delay, then asked for and received yet another extension to complete the project, until February 2021. After the extension was approved, IPI fired 80 members of its labor force.
All these problems sparked the ire of Saipan Rep. Edwin Propst. “These terminations of local and H-2B workers, the recent multiple resignations of high-ranking executives at IPI and the termination of Pacific Rim are all telltale signs that the casino is having serious problems,” Propst said. He has called for an end to the company’s monopoly on gaming in the CNMI.
