US govt seeks default judgment vs Dynasty’s $2.5M

The U.S. government has requested the federal court to issue an entry of default against the $2.5 million that the owner of Tinian Dynasty Hotel & Casino has agreed to pay as part of a $3.03 million settlement of a criminal case.

Assistant U.S. attorney Russell H. Lorfing, counsel for the U.S. government, asked the U.S. District Court for the NMI on Friday to issue a default judgment against the $2.5 million for failing to contest the forfeiture action.

Lorfing also filed Friday his affidavit supporting the court clerk’s entry of default judgment.

In the affidavit, Lorfing said the U.S. government filed last Aug. 21, 2015 a complaint for forfeiture, alleging that Tinian Dynasty’s $2.5 million should be forfeited to the U.S. government.

The U.S. government’s notice of this forfeiture action was published for 30 days starting Sept. 18, 2015, on an official U.S. government website.

Pursuant to the law, Lorfing said, any claimant of the property was required to file a claim no later than 35 days after the written notice was sent on Aug. 21, 2015, or 60 days after the first publication of notice on Sept. 18.

“Those time periods expired on Sept. 26, 2015, and Nov. 18, 2015 respectively, and no extensions to these time limits have been requested, consented to, or granted by this court,” Lorfing said.

Notice of the forfeiture action was also published in the Saipan Tribune and Marianas Variety and anyone who wanted to claim a right to the $2.5 million must file a response within 30 days of publication.

“The time period to assert an interest in the property expired on Nov. 4, 2015,” Lorfing said.

Hong Kong Entertainment (Overseas) Investments Ltd., owner of Tinian Dynasty, gave the $2.5 million to the U.S. government in the form of a check last July 23 pursuant to their non-prosecution deal.

The new owners of Hong Kong Entertainment and the U.S. government have agreed not to prosecute the criminal case against HKE in exchange for HKE’s forfeiture of $3.03 million.

Last July, U.S. District Court for the NMI Chief Judge Ramona V. Manglona dismissed the criminal charges against HKE at the U.S. government’s request.

The parties entered into a non-prosecution agreement that requires Tinian Dynasty to forfeit $3,036,969.12. HKE has already made a payment of $2.5 million to the U.S. government.

The U.S. government filed in November last year 158 criminal charges against HKE related to the casino’s failure to file currency transaction reports or CTR.

HKE recently filed in federal court a Chapter 11 bankruptcy petition, claiming that it has total assets of $55.2 million, but its total liabilities reach $258.5 million.

HKE counsel Timothy H. Bellas disclosed that one of the first priorities of the case will be to ask the bankruptcy court for permission to pay the unpaid salaries of Tinian Dynasty employees and unpaid taxes both federal and local.

Bellas said the purpose of Chapter 11 is not to go out of business but to continue doing so.