Massive water fraud exposed

U.S. District Court for the NMI designated Judge David O. Carter disclosed yesterday the discovery of massive water fraud taking place on Saipan, citing an unaccounted loss of thousands of gallons of water per day.

Citing a Commonwealth Utilities Corp. water tank service area that serves a population of 2,954, Carter said there is an estimated 872,000 gallons of water that is lost every day.

“Where’s the 872,000 gallons of water going? Some could be pipe leaks and some could be from theft,” the judge said.

Carter said this massive water fraud has to be stopped immediately.

Carter made the disclosure after a meeting with Attorney General Edward Manibusan, deputy AG Lillian Tenorio, CUC legal counsel James Sirok, and U.S. Department of Justice Environmental Enforcement Section senior attorney Bradley O’Brien.

Although Manibusan did not issue a statement in open court, Carter said that Manibusan is very cooperative in addressing the problem.

Citing a specific area on Saipan, the judge said that CUC’s actual production in that place is 1,038,240 gallons of water per day, providing 24 hours of water to a population of 2,954.

He said the billed usage average is 166,670 gallons per day.

Making this calculation, Carter said this water fraud costs $12,229 per month or $146,750 per year.

Carter hinted that this case is “a drop in a bucket” and speculated on the potential of a group of farmers committing water fraud, which answers the question about the unexplained water loss.

Carter then pointed to a map of the area to show “how massive the water fraud is.”

He noted that in 2015, a person was discovered to have an illegal water connection and a police officer was brought in and the illegal water supply was disconnected.

Carter said in September 2017, the water supply was cut off in that same area, but in January 2018 the person apparently re-hooked the water line again.

The judge said minimally it’s three years of water fraud.

Carter said because of this person or persons, CUC would eventually pass on the increased water rate to regular customers.

CUC billing and financial accounts manager Bettina Terlaje also disclosed that CUC discovered yesterday morning two more farms that were believed to have illegal water connections.

Carter praised CUC for the discovery and thanked the U.S. Environmental Protection Agency and Manibusan for appearing in court to address the water loss situation.

Carter said CUC is also looking at other areas on the island that may have the same water fraud problem.

CUC water/wastewater division acting chief engineer Larry Manacop, who did a PowerPoint presentation yesterday about CUC water and wastewater engineering and operations with water/wastewater division manager Gary Byra, agreed with Carter that pumping 17 wells will dramatically increase the water supply in certain areas that have no 24-hour water supply.

In an interview, CUC legal counsel Sirok said they are going to work with the OAG as they investigate the water fraud matter and see what happens after that.

Sirok said they know for sure about two farms that they are looking at, but there may be more.

“I don’t know the exact number at the present time. That’s what the investigation will find out,” he said.

Sirok also stated that they had a good two weeks of discussion with Carter on stipulated order issues that include not only water but also power and oil.

“We had a great field trip with the judge last week. This is the first time that the judge had an opportunity to really look at our water side,” said Sirok, adding that in the last several years Carter dealt only with stipulated order 2—the oil side, pipeline, construction of fuel tank, and so forth.

“This is a great time for us to present all of these to the judge,” he said.

Sirok said that, in six months, the judge will see where CUC is on the plan is to reinvigorate the water system.

“Our goal is to try to get better water hours for everyone. There are certain areas that have only two hours of water service. That’s not acceptable for any of us,” Sirok said.

He said CUC’s and EPA’s effort is to hopefully put in place 24-hour water supply throughout the island.

On the funding issue, Sirok said CUC gets a certain amount of funding every year by applying from various sources, mostly from EPA for water.

He said they have a grant request with the U.S. Department of Agriculture that will help provide water in Dandan.

“We have grants that are ongoing right now and we are looking at the application for fiscal year 2018 grant from EPA and how we’re going to use that money,” he said.

Ferdie De La Torre | Reporter
Ferdie Ponce de la Torre is a veteran journalist who has covered all news beats in the CNMI. Born in Lilo-an, Cebu City in the Philippines, De la Torre graduated from the University of Santo Tomas with a bachelor’s degree in journalism. He is a recipient of many commendations and awards, including the CNMI Judiciary’s prestigious Justice Award for his over 10 years of reporting on the judiciary’s proceedings and decisions. Contact him at

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