Hong Kong Entertainment, owner of the Tinian Dynasty Hotel and Casino, told a federal judge this week that its financial situation was so bleak that it could no longer afford a lawyer to represent it in ongoing legal claims filed by creditors.
The casino on the Pacific island of Tinian, one of the Northern Mariana Islands, has been shuttered since 2015 when it was hit with a $75 million fine by the US Financial Crimes Enforcement Network (FinCEN) for anti-money laundering violations, the largest ever such fine imposed. The Northern Marianas are collectively an unincorporated US territory.
Trouble in Paradise
In his letter to District Court for NMI Magistrate Judge Heather L. Kennedy, Tinian Dynasty Chairman Chan Chun Wai said his company’s liabilities now exceeded $250 million, excluding the $75 FinCEN million fine, and that figure is growing each day due to interest and late payments.
We ran out of money and cannot pay…the departments of government, the staff, the suppliers, the shareholders or the attorney we used to hire. As we cannot pay our attorney, he [has] withdrawn…and we cannot find another one to represent us,” he wrote.
Chan said that creditors’ attorneys were attempting to “take advantage of us because we have no money to hire a legal representative” and he offered to “come forward to explain in person before the judge without an attorney.”
$75 Million Albatross
In 2015, FinCEN found that the Tinian Dynasty was guilty of “willful and egregious” AML violations. Casinos are required to file currency transaction reports (CTRs) on all transactions over $10,000, but investigators discovered thousands of unfiled CTRs on the casino’s premises. They also established that casino employees would routinely instruct customers on the most efficient methods to avoid the scrutiny of law enforcement.
“Tinian Dynasty didn’t just fail to file a few reports,” said then FinCEN director Jennifer Shasky Calvery. “The casino operated for years without an AML program in place. It failed to file thousands of CTRs and its management willfully facilitated suspicious transactions and even provided helpful hints for skirting and avoiding the laws in the US and overseas. Tinian Dynasty’s actions presented a real threat to the financial integrity of the region and the US financial system.”
In January, the Saipan Tribune reported that a group of investors had inspected the shuttered property, but prospective buyers are unwilling to take it on because of the $75 million albatross hanging round its neck.
But while the island’s largest hotel remains closed, its tourist industry is suffering. Officials on the island hope they can negotiate a settlement with the US government that will make the property a more palatable investment opportunity.