CNMI Corruption Countdown: American Taxpayers Say No More Fraud, Waste, and Abuse
- CNMIGA .ORG
- Sep 28
- 6 min read
Updated: Sep 29
#CNMIAudits #MissingFunds #FederalOversight #AccountabilityNow#WhistleblowerVoices #ZenosParadox #USDOJOversight #AuditTheCNMI
Billions Down the Drain: How U.S. Cash Vanished in Paradise
Hey, reader! Grab your sunglasses and a piña colada because we're heading to the sun-drenched shores of the Northern Mariana Islands (CNMI) – a U.S. commonwealth where beaches are pristine, volcanoes dramatic, and... billions of federal dollars have pulled a Houdini act over the last decade.
This isn't some tropical tall tale; it's the eye-popping story unpacked in the report From Covenant to Corruption: A Decade of Unaccounted Federal Dollars.
Think of it as a financial thriller meets comedy of errors, with real stakes for American taxpayers like you.
If you're wondering, "CNMI? Sounds like a fancy cocktail," let me break it down: These Pacific gems, home to about 50,000 folks (mostly indigenous Chamorros and Carolinians, plus guest workers), joined the U.S. family back in the 1970s via the Covenant – a deal promising citizenship, federal perks, and cash to build a brighter future.
But as the report hilariously (and heartbreakingly) reveals, what started as a lifeline turned into a leaky bucket, with money gushing in for schools, hospitals, and disaster relief only to evaporate into audit delays, questionable costs, and suspicious offshore flows.
This report isn't dry legalese; it's a page-turner built on GAO reports, USAspending data, audits, and congressional testimony, dedicated to fighting for integrity and sanity. (It even tosses in a Bible verse for that extra motivational kick.)
Let's surf through the saga, keeping it fun, fact-filled, and full of "wait, what?!" moments. And hey, if this hooks you, download the full PDF – it's packed with appendices like questioned costs CSVs and referral templates for GAO probes. Don't just read about the mess; arm yourself to fix it!
The Covenant: A Tropical Promise That Went Bananas
Flashback to the groovy 1970s: Disco fever, Star Wars, and the CNMI shaking off colonial chains from Spain, Germany, Japan, and U.S. trusteeship. The locals voted big-time to become a U.S. commonwealth under the Covenant – a "triumph of self-determination" granting citizenship, federal program access, and that golden "full faith and credit" pledge.
As the report's Chapter 1, "Covenant Betrayed," spells out, it was supposed to make these islands part of the American dream team, strategically parked near Guam for defense vibes.
For generations who'd been passed around like a hot potato, this was huge – a bridge to prosperity, not periphery status. But fast-forward, and whoops! By the 2000s, cracks showed up bigger than a typhoon crater. The garment boom (think cheap labor under special rules) fizzled amid scandals. Tourism? Hit-or-miss. So, federal dollars became the star player, making up over 50% of the CNMI's budget by 2015.
The report nails it: "The Covenant was meant to be a bridge. Instead, it has become a funnel—delivering U.S. dollars to local elites... while ordinary people struggle." It's like inviting friends to a luau and watching the food vanish before anyone eats.
Over 2015-2025, more than $4 billion (conservative tally; some estimates hit $8.2 billion via USAspending) flooded in for a tiny population. With absolutely nothing to show for your tax dollars~!
***And, as an American Citizen; YOU CANNOT OWN LAND ON THE ISLAND THAT YOU ARE SUPPORTING
That's lotto-level cash per person!
But with weak oversight, it invited shenanigans. Recent updates? As of September 2025, audits are still lagging – a U.S. oversight report notes CNMI among Insular Areas with unsubmitted FY2022-2023 reports.
But hey, progress: Gov. Apatang signed an EO in August 2025 creating a Single Audit Committee to catch up, aiming for FY2024 submission by October 2026. And a $250k federal grant just dropped in September to help.
Download the PDF for the full timeline in Appendix C – it's your cheat sheet to this fiscal fiasco.
The Federal Cash Wave: Surf's Up, Accountability Down
Dive into Chapter 2, "Federal Flows to Fragile Shores," and it's like watching a money tsunami hit without lifeguards. From 2015-2025, CNMI got drenched in aid: block grants, Medicaid, education funds, typhoon relief, and the mega-splash of pandemic bucks.
The report crunches it – over $4 billion for under 50,000 people, often tripling local taxes ($200 million in good years).
Here's the playlist of cash categories, with a side of "where'd it go?":
Block Grants & Compact Impact Funds: Cash to cover migrants from nearby Pacific pals (FSM, Palau, Marshalls). But it blurred into general budgets, fixing payrolls not projects. Like using gift cards for gas instead of gadgets.
Medicaid Supplements: Affordable Care Act magic sent tens of millions to CHCC yearly. Aim: Better health. Oops: Shortages galore, eligibility flubs, undocumented claims. A nurse in the report: "We had medicine from NGOs, but federal funds? MIA in the wards."
Education Grants: Title I for needy kids, Pell for college. Kept schools open, but teachers dipped into pockets for supplies amid payroll mishaps. A teacher's zinger: "Millions for education, but no for basics? Where'd it go?"
Disaster Assistance: Typhoons Soudelor (2015) and Yutu (2018) unleashed FEMA millions. Rebuilt some stuff, but connected contractors scored debris gigs with iffy docs. Villages tent-camped while funds "flowed through opaque systems."
Pandemic Relief: CARES, ARPA, PUA – hundreds of millions to survive COVID. Lifesaver for some, but audits spotted ghosts, duplicates, and $1.13 million questionable unemployment claims. "Diluted by bureaucracy and favoritism," per the report.
The kicker? Federal funds dwarfed the economy – over 60% of revenue some years.
Dependency twisted priorities: paperwork over progress, elites grabbing slices, delays risking shutdowns. And the casino dream? Imperial Pacific International (IPI) promised riches but cratered in scandals.
Update: In August 2025, Team King bought IPI's assets for $13 million, with a judge setting October for restructuring. But lingering ties to old owners raise eyebrows. The report calls it a "mirage" – download for the juicy details, including how it fueled the mess.
Dependency Drama: Addicted to Uncle Sam's Wallet
Chapter 3, "The Rise of Dependency," is where the report gets real: Federal cash wasn't extra; it was essential. By mid-2010s, over 50% of budget; pandemic peaks hit 60%. IPI's 2019 flop (laundering suspicions, indictments) just hooked them harder.
Side effects? Comedy-tragic:
Policy Twist: Leaders chased D.C. forms over local innovation – like binge-watching Netflix instead of building a business.
Elite Grab: Politicos and pals padded contracts, especially post-typhoon.
Fragile Vibes: One transfer hiccup? Shutdown alert.
Remittances ballooned to $120-130 million yearly, often to the Philippines – legit wages or sneaky exits? The report wonders. Recent corruption news? Indictments for federal fraud in PSS (public schools), like a mom-daughter duo accused of wire fraud with education funds.
And FBI wrapped up a probe on ex-Gov. Torres in July 2025. WHY WOULD A SITTING DELEGATE EVEN ASK THE FBI SUCH A QUESTION ?
Download the PDF's Appendix C for the remittance timeline – it's eye-opening.
Audit Abyss: The Black Hole Swallowing Billions
Part II, "The Audit Black Hole (2015–2025)," is the report's detective thriller.
Federal law (Single Audit Act, 2 CFR 200) demands yearly audits for big recipients – check compliance, flag "questioned costs." CNMI? Treated it like optional homework.
Chapter 5's "Missing Years": Delays (2016-2018), incompletes (disclaimers), total no-shows (2019, 2022-2023).
GAO confirms: Still behind in 2025. Questioned costs?
Wild:
2015: $17.1M
2018: Late, "material weaknesses"
2020: $553.2M awards, shaky controls
2021: $74.8M new + $69.8M old unresolved
Chapter 7's "Zeno’s Paradox": Endless delays, no real fix.
Real impact: Schools supply-less, hospitals med-short, workers unpaid. But funds kept coming!
Recent twist: EO and grant to speed audits.
The PDF's Appendix A CSV lists 'em – download for the shock value.
Summit Shenanigans and Trust Tricks: All Talk, No Walk
Part III spotlights the 2020 Fiscal Summit: Revenue dreams, austerity chatter, trust schemes – but audits? Crickets. Casino crash left pensions dangling; ASC Trust's blind spots screamed scrutiny.
It's like a diet plan with cake – promising, but poof! Gone.
Shadowy Laundering: The Offshore Escape Artists
Part IV: FinCEN forensics needed for $1.36B remittances.
Philippines links? Elite properties. Banks' weak SARs? Suspicious. With CNMI's Pacific spot, this ties to security – a 2025 article urges targeting corruption vs. China.
PDF has referral templates – download to join the hunt.
Human Heartbreak: The Real Cost Behind the Cash
Part V: Schools sans stuff, hospitals minus meds. Workers (Filipinos, Bangladeshis, locals) exploited; indigenous rights eroded. "American Citizens in Limbo" – Covenant promises? Broken.
Justice Journey: Fixes for the Future
Part VI: False Claims Act, GAO probes, reforms like PROMESA boards.
Download for Appendix D templates – your action plan.
This report's a wake-up call:
Download the PDF now.
With ongoing fraud cases and audit pushes, it's time to plug the drain!
