Speaker Tenorio: Gambling with the Future of the CNMI

September 30, 2010

Every day I expect to see headlines in the CNMI papers saying that 10,000 people marched on the Legislature to protest their failure to pass a responsible balanced budget. But there is just more news of Covenant Party and Fitial supporting legislators who are unwilling to compromise with the minority and have created a deadlock that has resulted in a government shutdown.

The Marianas Variety reported:

In Executive Order 2010-11, Fitial noted the constitutionally mandated shutdown of non-essential government services beginning today, the first day of fiscal year 2011.

“With deep regrets, I have acted upon the constitutional mandate of Article III, Section 9(a) of the Northern Mariana Islands Constitution. Pursuant to this mandate, it is my duty to order a shutdown of non-essential government services as the government is duly prohibited from drawing any funds from the general fund for services outside of those that I have identified to be essential,” Fitial said.
Speaker Froilan Tenorio is the rogue, smart alecky official who appears to fanning the flames of discord. He was a wise guy when he served as governor, and he is a wise guy as speaker.  I can remember when he told the Assistant Secretary of the U.S. Department of Interior, Leslie Turner, to "shut up." I can remember when he claimed he didn't want anything "to do with human rights advocates anymore" because he realized I wouldn't cover up abuses. I also recall when he proposed that children of U.S. citizens who were born in the CNMI should not have U.S. citizenship.

I always have thought of this guy as a self-serving truth bender. Give a rogue, smart-alecky truth bender power, and he'll become an out-of-control wise-guy on steroids, poisoning any negotiations and getting high from the chaos he creates.  Tenorio lacks integrity, honor and class. Oh, and he can be bought, as his previous deals with Abramoff prove.

The CNMI House, under the leadership of Speaker Froilan Tenorio, appears to be holding the budget negotiations hostage unless the members support legislation allowing casinos on Saipan.  The House passed the Saipan casino bill in August 2010, but the Senate killed it. This move for casinos on Saipan is being pushed even though in 2007 the voters rejected a proposal for Saipan casinos. Instead of negotiating for a balanced budget, this bully is reportedly drafting another casino initiative that will be brought before voters next year.

Just to rub salt into the wound wise guy Speaker Tenorio cracked to House Minority Rep. Diego Benavente, “What can you say Representative Benavente?”

Benavente correctly pointed out that the speaker's sarcastic remark was "improper."

So what's the deal? The speaker appears to be willing to gamble his political career on ensuring casinos are allowed on Saipan. Tenorio has had his hands and heart in the casino business since his partnership with his former lobbyist and convicted felon, Jack Abramoff.  In early 1990's Abramoff was working with Tenorio to establish a casino on Tinian.

 In 1997 then-Governor Tenorio took a little side trip to visit the Choctaw casinos in Mississippi with Abramoff-lobbyists on the tax payers' dime as billing records to the CNMI revealed:

In 1999 Governor Froilan Tenorio was being investigating for misuse of funds including a $3.4 million loan that he granted to the Tinian Casino Gaming Control Commission.

In 2003 Tenorio was pushing his "casinos will save the CNMI" theory once again at a public hearing.

In 2004, Tenorio was pushing casinos on all three islands, vowing to meet with the Catholic Church and stating several "Japanese investors support the proposal."

In 2007, Tenorio was implicated in an illegal casino gambling scheme at the Victoria Hotel in Garapan, Saipan with his Japanese business partner, Hideo Kato and businessman, Byoong Seob Choi who were charged with 119 counts of illegal gambling activity and unlawful employment of aliens.

Another casino pusher has been Governor Benigno Fitial who lobbied to bring the SunCruz Casinos to Saipan. The governor is also tight with Bridge Capitol known in the mainland for their casino schemes in the Caribbean and Washington, DC.  Many of the  investment deals he has planned for the CNMI seems to contain the word "casino."

Could Tenorio, a man who seems to have no conscience and no moral compass, have a juicy casino deal in the wings that would fill his pockets? Is he is dealing with fellow CNMI dealer-wheeler Benigno Fitial?  After all, Covenant folks are backing the despicable ploy to kidnap the budget. Could there be kickbacks or promises of lucrative partnerships?  Over the years both Tenorio and Fitial have pushed several other casino deals often using their positions as governor and speaker, the offices both have held or hold now, to push the schemes along.

Floating Casinos
In April 2001,  Adam Kidam co-conspirator of Jack Abramoff visited Saipan for the second time to push a partnership with SunCruz, the Florida -based floating casino company.  From the Saipan Tribune:
A huge Florida-based leisure company is seriously looking at putting up a multi-million-dollar investment on Saipan, a development seen to alleviate the CNMI’s economic conditions, which had gone sour since the Asian contagion in 1997.

Executives of SunCruz Casinos were on island earlier this week to meet with key government officials where concrete plans for the establishment of a $10-million floating casino near the coast of Saipan were discussed.

...According to SunCruz Casinos Chair Adam R. Kidan, initial infusion of investment would amount to between $10 million and $12.5 million while other business opportunities throughout the Northern Marianas are being carefully looked at for future expansions.

Mr. Kidan’s group were in the Northern Marianas in December last year to explore possible business opportunities here. Company officials also simultaneously conducted a trade visit in Guam where SunCruz Casinos also intend to bring in a floating facility.

SunCruz is also in the final stages of bringing its floating casino in some Asian countries like Hong Kong and the region’s casino gaming hub -- Macau.

"We are continuously deploying floating casinos to areas where there are good potentials. The Northern Marianas can be a casino hub in the Pacific Region, especially with its proximity to Asia where millions play cards and machines," said Mr. Kidan.

Part of the plans for the Northern Marianas is the training of at about 200 to 250 local workers who are promised to receive a compensation package which is above the prevailing minimum wage in the mainland US.

Mr. Kidan said the business operation will create job opportunities for local workers who may also ask to be transferred to other company-operated floating casinos in the mainland US, Asia or the Caribbean.

SunCruz Casinos, which commenced operations in 1989, is also seriously eyeing some investment opportunities in the Northern Islands which, Mr. Kidan said, hold the potential of attracting thousands of tourists because of the area’s scenic beauty.

The company intends to bring in some of its casino employees in Florida to conduct the training of local workers who will be accepted to work on Saipan’s own floating casino.

"It is important to choose where to put investments. A myriad of things have to be considered, including the potentials of an area to sustain the business, as well as the existing laws on investments," said Mr. Kidan.

Once the floating casino is deployed and moored on Saipan, the Northern Marianas is anticipated to witness the entry of more than a million visitors every year since Mr. Kidan noted that each of the company’s vessel receives about two million visitors each year.

He added that SunCruz Casinos is also eyeing investments in the transportation sector since a reliable transport system is essential to the company’s floating casino business, which is heavily dependent on casino players from other countries.

Mr. Kidan and other executives of SunCruz Casinos will be back on Saipan to meet with other CNMI government officials, including Gov. Pedro P. Tenorio and members of the Legislature, as well as private sector leaders.

In his meeting with House Speaker Benigno R. Fitial earlier this week, he said the company is hoping to deploy the floating casino to the Northern Marianas by August this year.
Abramoff and his partners bought SunCruz Casinos in September 2000 in a underhanded deal that landed Abramoff and Kidan in prison. (Read the entire scandalous tale in this Washington Post article.) In 2005 Abramoff and Kidan were arrested:
Washington lobbyist Jack Abramoff and a business partner were indicted by federal grand jury in Fort Lauderdale on Thursday, charged with five counts of wire fraud and one count of conspiracy in their purchase of a fleet of Florida gambling boats from a businessman who was later killed in a gangland-style hit.

Abramoff, 46, was arrested in Los Angeles in the late afternoon and was expected to be taken before a U.S. magistrate there on Friday. He was indicted along with Adam Kidan, the former owner of the Dial-a-Mattress franchise in Washington. Kidan, 41, of New York City, will surrender to the FBI here by Friday morning, his attorney, Martin I. Jaffe, said in a written statement.
Fitial wasn't alone in his support of bringing SunCruz to Saipan. Froilan Tenorio also backed the floating casino.  When the deal was junked by the Tinian Casino Gambling Control Commission, the May 22, 2002 issue of  the Saipan Tribune reported that the TCGCC penned an explanation to casino-loving Froilan Tenorio:
TCGCC Chair Martin DLG. San Nicolas informed former governor Froilan C. Tenorio that a review of the applicable statutory law disclosed that the Casino Act does not grant the commission the authority to license a floating casino anchored to the shoreline of Tinian.

"If applicable licensing requirements were modified, the Commission would not oppose the concept of a floating casino in the Second Senatorial District. However, based on the review and consultation with the commission’s legal counsel, we have concluded that the clear and unambiguous language of the Casino Act does not grant the commission the authority to license a floating casino," explained San Nicolas.
Casino pusher, Bridge Captial moved to the CNMI because of the tax loopholes. The company has a less than pristine reputation in the states.

Fitial and Bridge Capital are buddy-buddy.  Bridge Capital donated $10,000 for his last inauguration celebration. In March 2006, a Virgin islands newspaper, The St. Thomas Source even covered the relationship of Fitial and Bridge Capital:
Bridge Capital, the St. Croix-based financial operation run by gambling promoter Shawn Scott, has received a major tax break from the newly elected governor of the Commonwealth of the Northern Mariana Islands. 
According to a local newspaper on Saipan, the Marianas Variety, Bridge Capital will receive the following tax benefits: no income tax, no business gross revenue tax, no excise tax; and no earnings tax for the next quarter of a century. 
A rival newspaper reported, as did the Source, on Scott's many brushes with governmental regulators in the United States. 
The Saipan Tribune wrote: "A Washington Post article published on July 22, 2004 labeled Scott as a 'gambling promoter' who was behind the much criticized proposal to set up gambling operations - slot machines -- in the District of Columbia area. This resulted in D.C. residents filing a lawsuit opposing it." 
This did not the faze the new CNMI administration. According to the Tribune, the director of CNMI's Commonwealth Development Authority, Glenn Quitugua, "expressed no worries over this issue, saying the board is 'satisfied' with the information presented by Bridge Capital."
In April 2007 the Saipan Tribune reported that Bridge Capital had proposed a casino at on Guam, but the proposal was rejected:
Bridge Capital co-founder John K. Baldwin offered to pay $100 million worth of advance tax payments to the government of Guam. Baldwin offered the money in exchange for the enactment of local law to allow his company, Guam Greyhound, to operate a casino at its dog racetrack in Tamuning. The offer was rejected.

Anderson said he did not believe Bridge Capital would make a similar offer to the CNMI “because of the unique situation here.”

“But anything is open to discussion,” he added. “Ultimately, it's up to [Bridge Capital principals] John Baldwin and Shawn Scott because it's their money.”
Unique may be an interesting choice of words.  In September 2009 the CNMI Department of Finance approved the operation of video lottery games in the CNMI, paving the way for Bridge Capital LLC to operate such games at the long-vacant La Fiesta Mall in San Roque as it originally proposed to Finance:
In June, Bridge Capital chief executive officer John K. Baldwin said they will be investing a minimum of $5 million to revitalize the long-vacant La Fiesta Mall in San Roque that will consist mainly of video lottery games, along with restaurants, shops and other tourist attractions.

If and when the government awards a contract to Bridge Capital, it will be the first time that video lottery games will be operating in the CNMI.

Bridge Capital bought interest on the La Fiesta property in March 2007.
As the Saipan Tribune and Virgin Island newspaper reported, Bridge Capital owners, Shawn Scott and John K. Baldwin are controversial.  Residents in the Washington, D.C. area filed a lawsuit to oppose their proposal for slot-machines in  the D.C. area.

From the Washington Post:
Bridge Capital is owned by Shawn Scott and John K. Baldwin, Las Vegas entrepreneurs who have tried for years to qualify for a license to operate a big-time gambling venture. They have had little luck, public records show. Scott, whose properties have received financial support from Baldwin, has been denied or failed to obtain gambling licenses in five states where regulators found evidence of financial mismanagement, irregular accounting practices and hidden partnerships.
TPM Muckraker details the connections of Baldwin, Abramoff, Julius Kaplan and others.

Former Rep. Tina Sablan summed up the failure of the legislature in her letter to the editor:
House leaders, stop trying to force the casino bill down the throats of your Saipan constituents who have now twice voted against it. How many times must we say "no"? Enough with the blackmail, the fear-mongering, and empty promises. You yourselves have acknowledged that it would be years before any revenue might be realized from any Saipan casino that might materialize; in the meantime we would have to brace ourselves for the exorbitant costs of a new gaming commission that will likely hire expensive consultants and go on fact-finding missions. If you do not have better ideas for stabilizing and revitalizing our economy and government, then please, do us all a favor and resign.


Anonymous said...

How could they have donated $10k? Isn't there a contributions cap?

Anonymous said...

Tina is wrong on this one. Profits would materialize almost immediately for the casino owners, investors, and those whose pockets were filled for exchange for a vote.

The Saipan Blogger said...

Donating to a party (small p) isn't the same as donating to a campaign. Think of it as a sponsorship.

The Saipan Blogger said...

And there is no contributions cap in the CNMI. As a former candidate, I can tell you that it is perfectly legal to donate and/or accept as much as your little heart desires. And the reports don't get reviewed by anyone but the government. Nobody in the public knows how much people donate to candidates.