Imperial Palace Casino License Faces Suspension, Parent Ordered to Pay $25M

Posted on: April 27, 2021, 05:25h. 

Last updated on: June 16, 2021, 11:05h.

The Imperial Palace Saipan casino resort in the Northern Mariana Islands has six months to pay $25 million to the US territory’s local government.

Imperial Palace Saipan casino resort
The lobby of the Imperial Palace Saipan resort is seen. Casino operations will be suspended next month at the property unless the parent holdings company adheres to a local order on the Northern Mariana island. (Image: Imperial Palace)

In an order issued late last week, the Commonwealth Casino Commission (CCC) of the Northern Mariana Islands said the resort’s parent company — China’s Imperial Pacific International (IPI) Holdings — has failed to pay its annual $15.5 million license fee.

The CCC adds that the firm also failed to pay a $3.1 million yearly regulatory fee, and did not meet its required $20 million contribution to the island’s Community Benefit Fund in both 2018 and 2019.

As a result, the CCC directed that casino operations be suspended at the Imperial Palace casino.

We are suspending the license indefinitely until IPI complies with those orders,” stated CCC Chairman Edward DeLeon Guerrero.

The casino order is effective May 10, meaning gaming will continue until that date. The CCC has given IPI six months to pay the $25 million or face additional penalties, including the possibility of having its casino license revoked.

VIP Business Stopped

The outlook for the Imperial Palace Saipan casino certainly isn’t promising. The project has been dealt one setback after another, much of it self-inflicted. Dozens of construction workers at the lavish casino site were severely injured over the past five years, and vendors have repeatedly told government officials that IPI is not paying invoices.

Female workers claimed in lawsuits that they have been forced to swim with male guests while wearing bikinis and were repeatedly sexually harassed. The women say their complaints to resort management went unheard.

More controversy ensued when the resort’s temporary casino claimed to be generating more than $2 billion a month in gross gaming revenue, making it the world’s richest casino. It was believed that IPI in conjunction with VIP junket groups was chartering in Chinese high rollers. IPI later admitted that it was forced to write off hundreds of millions of dollars in unrecoverable debts from high rollers who fled.

Adding more damage to IPI’s outlook, the Northern Mariana Islands CCC this week said Imperial Pacific is no longer permitted to work with junket groups. That decision is likely to be tied to the mainland Chinese government ramping up its efforts to impede its residents from traveling abroad to gamble.

Receivership Avoided

Last month, IPI was facing receivership over those unpaid vendor invoices.

The United States District Court for the Northern Mariana Islands ordered the holdings company to pay $1,182,793 to the US Department of Labor, complete an $800,000 escrow deposit, and pay outstanding back wages to construction laborers and casino employees.

IPI followed through on that order and avoided receivership. If that would have happened, the receiver would have assumed full financial and government control of the casino resort. IPI additionally would have been prevented from “transferring any interest, ownership, or control of any entity in which they presently hold such interest, ownership, or control,” the legal warning explained.