A Run Of Bad Luck For Imperial Pacific As It Loses $103 Million

Article by : Helen Sep 9, 2020

It looks like 2020 has been a historic moment of change for many gambling operators. While some businesses are desperate to stay afloat, others are mindlessly wasting enormous funds to save on costs. Imperial Pacific saw a whopping $103 million in losses in the first six months of 2020. The brand also decided to accuse CNMI of not respecting the exclusive rights specified in the licensing law. This step’s main goal was the desire to avoid paying license fees and thereby save on operating costs.

According to the official report, the first and second quarters of 2020 showed a colossal drop in 11.3% revenue, which amounted to more than $3.4 million year-on-year. The brand’s operating loss reached $6.84 million, while its real losses were $103 million.

Perhaps for some, this amount will seem incredibly large, but do not forget that in the first six months of 2019, the company lost more than $240 million. The brand was forced to close one of its divisions, namely the Imperial Palace, due to the coronavirus’s effects. A respite until the end of 2020 might be the only option for Imperial Pacific to avoid additional losses and keep the business afloat.

Previously, the brand’s management decided to communicate directly with VIPs to attract them to gaming halls. However, such an undertaking was not at all successful. It demonstrated the company’s inability to collect debt obligations from its VIP clients and tarnish the brand’s reputation on a global scale. The Imperial Pacific problems did not end there in 2020. It looks like the operator may have to pay a license fee of $15.5 million. The company’s management decided that the gambling establishment’s closure due to Covid-19 gives it the right not to fulfill its obligations to CCC. This decision helped the brand to defer payment of license fees. However, this was only the beginning of the conflict.

Later, the Governor of the Commonwealth of the Northern Mariana Islands made an official statement that such actions by Imperial Pacific are not at all acceptable. In turn, the IPI management put forward a counter-charge, indicating that CNMI had violated the terms of the license, which implies exclusive rights to provide gambling services in Saipan. The company’s lawyers base their claims on the fact that the island has collected a small number of poker machines and electronic games.

IPI’s new CEO, Donald Browne, has already written a formal complaint letter and sent it to the CNMI office. The company’s head pointed to the irreparable damage that the brand suffered since the exclusive rights were not granted to it in full. The top manager also suggested that the regulator postpone the payment of the license fee for 2020.

Despite all the gimmicks, Imperial Pacific has witnessed some disappointing news. According to information from one of the CNMI representatives, who authored the law on electronic games, the rule draws a clear line between the casino operation and the small gaming points located on the island. It looks like IPI will still have to pay the government $9.7 million in unpaid taxes.

IPI primarily develops and manages gambling halls. The company currently runs and administers various casinos, restaurants, hotels, shopping venues, and entertainment venues located in Saipan.

Senior management at IPI was charged with federal felonies recently, including the creation and control of corrupt organizations, illegal employment, and money laundering through investments in international advertising. It seems that the company needs some certain strategy to overcome all the issues.

Helen

Chief Editor

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