Casino Chips and Roulette Wheels Are Among the Items to Feature in the Third IPI Auction

Over the last few years, the Northern Mariana Islands, situated in one of the most remote locations of the Pacific, enjoys one of the fastest-growing gambling markets in the country. In particular, Saipan has emerged as one of the most profitable markets in the US.

Saipan is the largest island in Northern Mariana. In total, Northern Mariana Island boasts 7 brick and mortar locations with 5 of the most lucrative casinos located in Saipan. The remaining 2 casinos are located in San Jose on Tinian Island. 

The island of Saipan legalized its gambling market in 2014 and since then, Imperial Pacific International has remained the sole casino operator on the small US island. But IPI has had anything but a smooth time as the only casino operator. Over the last few years, IPI has been struggling to make ends meet and has been weighed down by mounting debt that has made expansion impossible.

To deal with its debt, the Northern Mariana Court approved the sale of IPI’s assets. The court that approved the sale of the casino’s assets then appointed Clear Management as the receiver of the casino’s unpaid debts. However, after weeks of negotiations, IPI convinced the court to stop the sale of its assets.

IPI asserted that it was in the process of negotiating financial and strategic partnerships that would solve its financial problems. This forced Clear Management to put its auction plans on hold as the embattled casino operator sorted its issues amounting to an excess of $100 million. In addition to the regulatory fees, IPI also owed million in lawsuit settlements and unpaid private debts.

For instance, US company Fanter Corporation sued IPI after the casino failed to pay its bills. Fanter Corporation was in charge of handling construction at IPI. After suing the casino, the court ordered IPI to pay $2.1 million, which the brand is yet to do.

Unfortunately, IPI was unable to live up to its promise and make its money problems disappear. As such, Clear Management has been accepting bids for IPI’s casino equipment since mid-2022. To see that IPI settles its debts, Clear Management has organized a series of auctions to sell off IPI’s equipment.

The third and most recent round of auctions was carried out in the first week of January 2023 with more auctions expected in the coming months. The auction that took place on January 2nd, 2023 involved the sale of roulette wheels, casino chips, as well as slot machines including well-known games from Light & Wonder such as Duo Fu Duo Cai. The next auction is planned for March 10th, 2023.

In September 2021, legislators debated whether or not to legalize online gambling on the island, which would help offset IPI’s debt. Had online betting been legalized, it would only apply to residents of Saipan and not the remaining islands in the Commonwealth of Northern Mariana, as it is officially referred to. 

Each of the islands in the Commonwealth relies on distinct regulatory frameworks for their gaming and casino markets. For years, Imperial Pacific International enjoyed the singular right to operate a casino on the Island of Saipan. However, IPI lost this right when its license was suspended indefinitely for failing to pay the yearly $3 million regulatory fee.

The commonwealth casino shut down owing to IPI’s debts

Just recently, the Commonwealth Casino Commission announced that it would be closing its doors effective the end of January 2023. The commission announced that it would be shutting down its location in Gualo Rai due to a lack of funding. According to the executive director of the commission Andrew Yeom, the commonwealth’s government ordered the casino to suspend its operations since the government could no longer afford to keep it open.

Since it was launched, the government has been funding the commonwealth office to keep it open. The funds to maintain operations were acquired from the yearly regulatory fee of $3.15 million that used to be paid by IPI as the exclusive casino licensee. However, since IPI hasn’t paid this annual fee since 2019, the government has been forced to cease all operations of the commission.

For months now, IPI and the commission have been involved in an arbitration process that would see the sole casino operator pay its dues.  Late last year in November, the commission requested funding from the government that would cover the arbitration process with IPI. The request to fund the arbitration proceedings with IPI was approved by the governor general, Ralph Torres.

Before the funding was approved, IPI had been granted a preliminary injunction stopping the commonwealth Casino Commission from revoking IPI’s license. In September, IPI was allowed to seek arbitration with the commission over the non-payment of the license fees.  For years, Andrew Yeom had been trying to get IPI’s license revoked at least 5 times with no luck for the non-payment of its regulatory fee. 

According to CCC, IPI has repeatedly violated 5 orders since 2020 namely:

  • Failing to pay the expected regulatory fee of $3.1 million.
  • IPI is accused of also failing to pay its yearly casino license worth $15 million. 
  • IPI is also accused of failing to comply with an order to settle debts with suppliers.
  • CCC also claims that IPI repeatedly failed to fulfill its minimum capital requirements as required by the casino regulator.
  • Additionally, between 2018 and 2019, CCC accused IPI of failing to contribute funds to the community benefit fund worth $20 million.

Final Thoughts

Although IPI has admitted to all of the violations named above, the casino operator is yet to pay up. CCC through its executive director Yeom had called for license suspension of the unstipulated amount until IPI complied with all the orders it had violated over the years. Sadly, Yeom believes that IPI will never catch up with its fines owing to its already ominous financial circumstances.

Nevada To Consider Proposal For State Lottery