Commission says they are only following law
Tinian Dynasty Hotel & Casino’s owner, Hong Kong-based Mega Stars Overseas Ltd., said yesterday they are hoping Tinian Casino Gaming Control Commission would be more reasonable with their restrictions on casino equipment purchases and hiring that is now hampering casino operations, with some approvals pending since October 2013. Commission chairman Matthew Masga, in response, said they are only properly enforcing the provisions of the Tinian Gaming Act even as the U.S. government is “scrutinizing” the Tinian casino industry.
At the same time, Mega Stars chief executive officer Cario Hon confirmed that as of yesterday afternoon, they have not picked up an application packet for a Saipan casino license—at least not yet.
Gov. Eloy S. Inos reiterated Friday that the individuals that have so far picked up the application forms are agents or representatives of investors. The deadline to turn in an application coupled with a nonrefundable $1 million fee is on April 21, only a week from today.
Mega Stars said since the Tinian casino commission’s “restructuring” and the “appointment of an executive director,” the cooperative relationship between Dynasty and the commission “dissipated quickly.”
Tinian casino commissioners are paid an annual salary of $75,000 each.
Mega Stars’ Hon and Tinian Dynasty general manager Tom Liu said the commission is now requesting Dynasty’s longtime vendors and suppliers to “undergo the process of licensing of casino service industries,” which they said was not previously required.
The process takes months to complete, delaying Dynasty’s purchase of new and replacement equipment and supplies.
Hon and Liu said Dynasty has been ordering and receiving service from their suppliers for over 10 years “without any issues or inappropriate dealings.”
“These suppliers have business interests in major gaming jurisdictions all over the world. As part of TDHCs business compliance, our processes include receiving multiple quotes before selecting the best supplier that is known and reputable in the gaming industry,” Hon said.
Mega Stars and Dynasty cited at least four Dynasty suppliers and vendors that have been operating in the United States, Macau, Australia, Cambodia, Vietnam, South Pacific, Singapore, and Europe for more than 15 years each.
Silver Heritage, for example, supplies Dynasty with electronic gaming machines. Liu said while Silver Heritage received transitional approval, they are “reluctant to deliver 61 new machines to the property.”
Matsui, Dynasty’s supplier of gaming chips and plaques since 2003, has also been waiting for approval since early March.
USPC, which supplies Dynasty with playing cards and electronic shoes, has also been waiting for approval since February. Liu said USPC is also being asked to complete a multi-jurisdictional application that is normally used for key employees.
International Casino Services, which has been Dynasty’s supplier of cage and table games management systems since 1998, has also been waiting for approval since October 2013.
Hon and Liu said the requirement of a casino key license for all staff was previously not an issue.
“Again, since the [commission] structure, this process has been slowed down by TCGCC. Since applications were submitted in January 2014, we have in excess of 35 staff that has paid $500, awaiting their casino key licenses and new badges since promotions. Is it because TCGCC is lacking the equipment required to produce these badges?” Hon asked.
An example of the commission’s restrictive hiring requirements, Hon and Liu cited Dynasty’s recent employment of former Casino Commission chair Martin San Nicolas and Bill Cing.
Since early March, Dynasty had tried to hire San Nicolas as compliance manager and Cing as director of human resources.
“They want a background check and an investigation into these individuals who were not only former Casino Commission chairmen but also Tinian residents whom they have known for a long time. This kind of background check was not done before,” said Liu in an interview at LauLau Bay Golf Resort yesterday afternoon, along with Mega Stars’ Hon.
He said other U.S. citizen applicants are also subjected to this “long drawn out procedure before being allowed to earn a paycheck.”
Dynasty and Mega Stars said Casino Commission commissioners are paid some $75,000 annually and meet every two weeks to review and decide on any outstanding requests or approvals.
“The TCGCC has met on several occasions and has still not permitted the ex-chairmen to commence their employment and ultimately being denied the right to earn a living,” Liu said.
Casino Commission chair Matthew Masga, in a phone interview, said the commission is doing its own due diligence in making sure the provisions of the Tinian Gaming Act are complied with.
He said the background checks, suitability, and other investigations are required under the law.
“We cannot rush anything. We have to comply with the law and we have to be careful. With all the things that have happened, and the feds scrutinizing not only Dynasty but also the commission, we need to take all matters seriously. The casino needs to be run like a banking institution,” Masga told Saipan Tribune.
Masga added that the Casino Commission hired a Las Vegas-based firm to do some background checks. He referred this reporter to Casino Commission executive director Lucy Blanco-Maratita for further information. The commission is expected to fully respond to Dynasty and Mega Stars’ concerns soon.
Hon and Liu said Dynasty operates 24 hours a day 365 days a year, “contributing to the Tinian economy,” so requests or approvals required urgently cannot be achieved by the commission.
“As a casino, we often service customers that have particular cultural beliefs that require movement of tables or manning of tables, to remain competitive in the Asian marketplace. The need for the TCGCC to work with TDHC and not against it is paramount for us to succeed and for the Tinian economy to succeed,” they said.
They added that Dynasty has the right to employ the right people for the positions required to operate in an efficient and professional manner.
They added that all due diligence is carried out before making these choices to employ.
“In the same context, suppliers are chosen under the same vigorous processes. Mega Stars is wondering what knowledge, precedence or jurisdictions the TCGCC have visited to apply these standards upon TDHC,” they said.
Hon said Mega Stars remains committed to Tinian Dynasty, the Tinian municipality and the CNMI as a whole, but asked that the Casino Commission to show its commitment to help investors help the economy.
“We are committed but the Casino Commission’s actions are making it hard for us to keep that commitment. We can’t do anything with all the restrictions they are imposing now,” Hon said in an interview.
Besides acquiring Tinian Dynasty last year, Mega Stars also plans additional investment on Tinian, including building a new 1,000-room hotel on Kastiyu, a scenic Tinian area atop Carolinas Plateau. The planned investment in the Puntan Kastiyu project alone is estimated at $200 million.
The plan includes a 36-hole golf course, and a $5 million water park on Tinian.
Earlier, Mega Stars and Dynasty expressed grave concern about the passage of a bill—and its signing into law later—allowing casino operation on Saipan. They said earlier they are “seriously considering discontinuing any additional investment in the CNMI due to what our investors perceive to be an irrational business environment here.”
Mega Stars said it was “shocked” that a Saipan casino bill would pass the Senate, barely months after it invested in Tinian Dynasty Hotel & Casino and began laying the groundwork for its other planned significant investments on Tinian.
The governor, however, expected that Mega Stars would be one of those that will apply for an exclusive license to operate a casino on Saipan.
For a long time, casino gaming was legal only on Tinian and Rota. This changed on March 21 when the governor signed House floor leader Ralph Demapan’s (Cov-Saipan) bill legalizing casino gaming on Saipan. It also marked the first time in at least four years that the Senate passed such a bill from the House. Saipan voters had already twice rejected casinos on the island twice; the last vote was in 2007.