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Imperial Pacific distances itself from indicted executives linked to money laundering, illegal workforce claims

Imperial Pacific International Holdings (IPI) has moved to distance itself from reports that two senior executives were indicted by the United States Department of Justice, claiming only one staff member was involved and that any criminal accusations were related to contractors and not the group itself.

IPI issued a statement overnight after the US District Court for the Northern Mariana Islands this week unsealed an indictment filed in August 2019 against three people, including two said to be senior executives of Imperial Pacific International (CNMI) LCC – the Saipan-based subsidiary of IPI developing its troubled resort and casino, Imperial Palace‧Saipan.

The trio were charged with one count each of RICO conspiracy and conspiracy to harbor illegal aliens, 32 counts of harboring illegal aliens, 32 counts of unlawful employment of aliens and five counts of international promotional money laundering. Another four unnamed people, including two more Imperial Pacific senior executives, were listed as co-conspirators but not indicted.

In its statement, IPI said, “Having made all reasonable inquiries, the Board hereby clarifies and confirms that one of the persons indicted by the United States Department of Justice was a former employee of the Group who was non-managerial staff and left in 2017.

“It is understood that the concerned incidents involve an allegation against MCC International Saipan Ltd. Co., one of the contractors of the Group in 2016, of matters including harboring illegal aliens. The Group is not prosecuted on the concerned incidents by the United States Department of Justice.”

According to the indictment, filed on 1 August last year, defendants Liwen “Peter” Wu, Jianmen Xu and Yan Shi conspired to employ workers almost exclusively from China instead of hiring US citizens, contravening rules implemented by the US Department of Homeland Security allowing employers to hire only a limited number of qualified alien workers under its CW-1 visa scheme, and only if there are no US workers qualified to do the job.

Wu is described as a senior executive of IPI and its subsidiary Marianas Enterprises Ltd, Xu as a senior executive of IPI, and Shi as a supervisor for MCC International Saipan Ltd (MCC CNMI), a subsidiary of China Metallurgical Group Corporation that was doing business in the CNMI.

Wu and Xu are alleged to have pressured MCC CNMI to accelerate work on Imperial Palace‧Saipan and “implicitly and explicitly ordered MCC CNMI to hire unauthorized alien workers,” and to import workers from China using the US Department of Homeland Security’s CP Program. The CP program was designed to allow Chinese and Russian nationals visa-free entry into the CNMI for business or pleasure purposes only.

The defendants allegedly hatched a plan to deceive US Customs and Border Protection (CBP) by instructing prospective workers in China to lie to immigration inspectors, claiming they wished to enter the CNMI as tourists under the CP Program.

“Over the next year, in response to heightened scrutiny by CBP inspectors, [the defendants and co-conspirators] promulgated increasingly elaborate schemes of deception, including but not limited to, providing costumes and backstories to hired workers, as well as pairing them with existing female employees in China,” the indictment said.

“The female employees posed as the illegal foreign workers’ spouses or girlfriends in exchange for paid vacations to the CNMI. In addition to reimbursing MCC CNMI and other contractors for the illegal workers’ salaries, IPI defendants also purchased plane tickets and paid other expenses for the illegal workers and their fake spouses or girlfriends.”

The workers were also paid in cash or by bank transfer to and from accounts in mainland China.

The scheme, which aimed to reduce labor costs while avoiding penalties for exceeding the company’s CW-1 visa quota, is alleged to have lasted until March 2017 and resulted in at least 600 illegal workers on site.

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