From BOOST Scams to Business Closures: CNMI's Corruption Crisis Exposed
- CNMIGA .ORG
- 6 days ago
- 9 min read
Updated: 2 days ago
In the heart of Saipan, the Commonwealth of the Northern Mariana Islands (CNMI) is witnessing an alarming exodus of longstanding businesses, leaving residents frustrated and fearful of an impending economic ghost town.
Just this week, National Office Supply announced its closure at the end of July, joining a grim list that includes the Grandvrio Resort's temporary shutdown starting April 2026, ABC Stores in Garapan folding on December 31, 2025, DFS Galleria ending 40 years of operations in May 2025, and Hyatt Regency Saipan ceasing business in 2024.
Online, the outcry is palpable.
John Camacho lamented on Facebook, "This is extremely bad and sad. What is the administration and the entire current legislature doing? Please do something!" Vera Ruben echoed the sentiment, calling it "so sad" for the loss of an affordable source for school and home supplies. On Instagram, one user warned, "How many more 'wake up calls' for the government to realize we are in a crisis? The way we are going this whole island will become a ghost town." Jordan Danao added, "Everyone is closing and moving. No plan, no vision. Bad leadership." Another commenter blasted, "It really shows that this administration is not helping businesses.
There are too many photo ops and not enough real action to support our local economy."
These closures aren't isolated incidents or mere byproducts of post-pandemic recovery struggles—they stem from a deeper, systemic rot:
the widespread theft and defrauding of federal funds meant to buoy the CNMI through crises like COVID-19. Had the CNMI government not orchestrated a collective plunder of over $330 million in CARES Act and ARPA funds by the time of this writing, the islands might still enjoy robust federal funding, cooperative partnerships, and genuine empathy from Washington.
Instead, rampant familial-based nepotism and corruption have severed those lifelines, accelerating the race to shutter businesses and hollow out the local economy.
This wasn't the work of a lone rogue actor but a team sport involving the CNMI government, its cronies, business associates, and extended family networks. Audits have uncovered $257.4 million in questioned costs across fiscal years 2020-2022, with $165.5 million tied directly to ARPA and CARES Act expenditures.
The BOOST program, touted as a lifeline for small businesses, devolved into a blatant fraud scam, with investigations revealing selective awards, rule-breaking recipients, and misuse that funneled millions into the pockets of insiders. Evidence points to a "perfect circle of corruption," where federal grants were diverted through fake businesses, unauthorized expenditures like vehicle rentals and illegal hotel stays, and questionable contracts—all while subrecipients went unmonitored and procurement rules were flouted.
This entangled web ensured that funds meant for economic stabilization instead enriched a select few, leaving legitimate businesses to wither without support.
To truly grasp the scale of this betrayal, consider the cascade of business closures that have plagued Saipan since 2020—a direct consequence of this mismanaged federal aid and the greed it enabled.
The list is heartbreakingly long, drawn from reports in local media like the Marianas Variety, Saipan Tribune, and Pacific Island Times, which have chronicled the island's economic freefall. Here's a comprehensive listing of major businesses that have shuttered their doors, each one a testament to the failed promises of federal relief programs like CARES and ARPA, which were supposed to sustain them but instead lined the pockets of corrupt insiders:
Imperial Pacific International Casino (March 2020): This high-profile casino, once heralded as a tourism booster, closed abruptly amid the pandemic after just three years of operation. Its shutdown was exacerbated by financial scandals, unpaid debts, and regulatory revocations, leaving hundreds jobless and contributing to a broader tourism collapse. The casino's woes were intertwined with CNMI's dependency on federal funds that never trickled down effectively.
Saipan World Resort (Temporary Closure, March 2020; Extended Indefinitely): Announced as a short-term measure due to COVID-19, this resort's shutdown dragged on, reflecting the lack of genuine recovery aid. Despite promises of federal support, the property struggled without the necessary infrastructure investments that ARPA funds could have provided—if not diverted.
Hyatt Regency Saipan (July 2024): After 43 years as a cornerstone of Saipan's hospitality sector, this iconic hotel cited dwindling revenues and economic pressures as reasons for closure. Local reports highlighted how the absence of sustained federal assistance post-pandemic accelerated its demise, with spillover effects rippling through suppliers, employees, and related businesses.
T Galleria Saipan (DFS Galleria, April 30, 2025): Operating for nearly 50 years (or 40, per some accounts), this luxury duty-free shop shut down amid a sharp drop in tourism. The closure sent shockwaves through the community, as it was a major employer and retail hub. Media coverage emphasized how federal funds meant for tourism revival were mismanaged, leaving such legacy businesses vulnerable.
ABC Stores Garapan (December 31, 2025): Hawaii's popular chain retail outlet pulled out after decades on the island, joining the exodus of major companies. This closure was part of a pattern where businesses, starved of real support, could no longer sustain operations in a shrinking market.
Tony Roma's and Capricciosa (Triple J Restaurants, Announced 2025): These dining staples, operated by local firm Triple J, closed due to "unprecedented challenges" in the economy. Reports noted the direct impact of reduced tourist footfall and lack of business grants that were promised under ARPA but often awarded through nepotistic channels.
Rendezvous Restaurant and Bamboo Bar at Saipan Vegas (Potential Closure, 2021 Onward): Tied to the uncertain fate of Saipan Vegas, these establishments faced shutdown if the parent operation ceased, highlighting the interconnected failures in the entertainment and hospitality sectors post-2020.
Asiana Airlines Saipan Office (Closed After 32 Years, Around 2024): The airline's withdrawal from direct operations on Saipan further crippled air connectivity, a vital lifeline for tourism. This move was linked to low passenger numbers, underscoring how federal infrastructure aid was squandered.
National Office Supply (End of July 2026): Unlike many others claiming financial hardship, this closure isn't about bankruptcy—it's a calculated exit. Sources indicate the company balked at hiring and maintaining a staff of American workers, preferring cheaper labor options that federal labor laws increasingly restrict.
What's more damning: National Office Supply secured numerous contracts from the CNMI government, funded through CARES Act and ARPA allocations, often at inflated prices that smacked of profiteering. They milked the system, overcharging for essentials like school and office supplies during the crisis, only to pack up and leave once the funds dried up.
This roster of closures—spanning casinos, hotels, retail giants, restaurants, and service providers—paints a picture of an economy gutted not just by external shocks like COVID-19 but by internal sabotage.
The real cause of these departures boils down to one word: "greed."
These businesses, along with their government enablers, got their hands on defrauded federal funds through programs like BOOST, which was riddled with scams and selective payouts. Now, like sloppy thieves fleeing the scene of the crime, they're abandoning Saipan, taking jobs, revenue, and community vitality with them.
But let's all hope that agencies like IRS-Criminal Investigation (IRS-CI), the U.S. Department of Treasury, FBI, and Homeland Security Investigations (HSI) are hot on their trails—even if they retreat to their home countries.
Secretary Scott Bessent, as the Treasury head, it's your turn to shine a light on these offshore remittances and hidden assets, ensuring that American taxpayers aren't left holding the bag.
The fallout is evident in Saipan's streets: hotel occupancy rates plummeted to 23.18% by FY 2026, the lowest since 1992, amid airline pullouts and tourism stagnation. A recent poll shows 44% of residents planning to leave, citing rising costs, shrinking job markets, and a "collapsing" economy.
Leaders warn of a "breaking point" where population decline and business failures could undermine even U.S. national security interests in the Pacific. Yet, this crisis was avoidable.
Without the orchestrated fraud, the CNMI could have leveraged federal empathy for reforms like reviving Covenant Section 702 funding or securing aid to stabilize air routes and tourism.
Delving deeper into the mechanics of this greed-driven collapse, it's essential to examine how programs like CARES and ARPA were weaponized for personal gain.
The CARES Act, enacted in March 2020, injected billions nationwide to mitigate pandemic fallout, with CNMI receiving substantial allocations for health, education, and business support. ARPA followed in 2021, adding more layers of relief.
But in CNMI, these became vehicles for fraud.
For instance, the BOOST program—administered through the Bank of Saipan and funded by ARPA—promised grants to businesses, farmers, and fishermen to foster stability.
Instead, FBI raids in December 2022 on the bank and CNMI Department of Public Safety offices uncovered probes into misuse, with agents carting off boxes of documents amid allegations of vote-buying and improper awards.
Over 1,700 applications were submitted, but only a fraction received funds, often going to politically connected entities.
This selective distribution starved genuine businesses, forcing closures.
Take the tourism sector: Pre-2020, it accounted for over 70% of CNMI's GDP.
But with funds siphoned off, airlines like Asiana pulled out, and hotels like Hyatt couldn't sustain. GAO reports highlight how casino collapses (e.g., Imperial Pacific's $165 million bankruptcy in 2024) compounded the issue, with unaccounted federal dollars vanishing into "audit black holes."
The garment industry's remnants, already decimated by 2009, saw no revival aid, as resources went to cronies.
Nepotism amplified the damage.
Family ties in government led to contracts awarded without bids, like those to National Office Supply, where inflated pricing on government purchases—funded by federal dollars—padded profits. Reports suggest markups of 50-100% on essentials, all while avoiding U.S. worker mandates under CNMI's unique immigration status.
This reluctance to hire locals or U.S. citizens stems from greed: cheaper foreign labor maximizes margins, but as federal scrutiny tightens, companies flee rather than comply.
The human cost is staggering.
Unemployment soared, with 44% of residents eyeing exodus.
Saipan's Garapan district, once bustling, is now a "ghost town," per local media.
Youth suffer most, with limited opportunities leading to social issues.
Federal partners, aware of the $330 - $550 million heist, withhold empathy, demanding audits before relief.
Amid this, Governor David M. Apatang's recent trip to Washington, D.C., for 902 talks and high-level meetings with Interior and White House officials, smacks of desperation.
All the begging in the world won't alter the truth or unlock relief until the federal government wraps up its desk audit of hundreds of millions in misspent funds.
The Office of the Public Auditor has flagged potential criminal charges, and U.S. inspectors general are probing ARPA spending, signaling that accountability is looming. Until those responsible—across government branches, their associates, and family ties—face consequences, federal partners will remain wary, and Saipan's businesses will continue to fade.
Yet, hope flickers in potential reforms.
Reviving air services, diversifying beyond tourism, and prosecuting fraud could stem the tide.
Community voices, like those from the Saipan Chamber of Corrupt Commerce, demand action:
"We have no positive outlook," warned Vice President Joshua Wise, urging leaders to heed the "signs that the economy is collapsing." GAO's fiscal warnings underscore the urgency, noting debt growth and risks from closures.
The CNMI's path forward demands transparency, not photo ops.
Only by rooting out this collective corruption can the islands reclaim federal trust and halt the devastating closures that threaten to turn paradise into a relic.
As residents like John Camacho plead, "Please do something!"—it's time for real accountability, before the last business lights go out.
EPILOGUE
READ THIS VERY TELLING COMMENT:
PatgonCNMI
31 minutes ago
The closure of National Office Supply is deeply concerning, but it also highlights a long‑standing issue in the CNMI’s labor system. While businesses often point to the loss of CW workers as the reason they cannot operate, the truth is that we have capable U.S. citizens and permanent residents here who can be hired and trained. The only reason many companies continue to rely heavily on contract workers is because the wages are cheaper, not because local people are unwilling or unable to work.
If businesses invested in training and development instead of defaulting to lower‑cost labor, we would strengthen our local workforce, keep money circulating within the community, and reduce our dependence on temporary programs that can change at any time. Relying on a labor system that forces workers to leave every few years is not sustainable for any business, especially one that plays such an essential role in our schools and government operations.
The CNMI needs to prioritize hiring U.S. citizens and long‑term residents, provide competitive wages, and build a stable workforce that isn’t vulnerable to federal program expirations or touchback requirements. We have people here who want to work and contribute. Investing in them is not only the right thing to do—it’s the only long‑term solution for economic stability.
(2) Islander
2 hours ago
The reason for closure is discriminatory and a slap in the face to all the local residents who have supported this business all these years. The statements made by NOS are brutally cold and calculated. She's saying "we don't want locals (American citizens) to work here. Wow! What a thank you to the CNMI. No heartfelt thank you to this island community who spent millions in your store. True colors shown
About the Author
Zaji “Persona Non Grata” Zajradhara is a staunch advocate for American workers and indigenous rights in the CNMI. Labeled a “persona non grata” by the CNMI government for his relentless pursuit of justice and his outspoken criticism of corruption and foreign influence, Zajradhara has become a symbol of resistance against the forces seeking to undermine American sovereignty in the islands.
As An Unemployed Afro-American resident and father, Zajradhara's firsthand experience with the CNMI’s dysfunctional labor market, its rigged political system, and the exploitation of vulnerable communities has fueled his activism. He has filed numerous legal claims against companies, including Tan Holdings, for violating labor laws and discriminating against American workers.
His unwavering commitment to exposing the truth, challenging the status quo, and demanding accountability has made him a thorn in the side of the CNMI establishment and a target of their efforts to silence him. However, Zajradhara remains undeterred, determined to fight for the rights of American workers and to protect the CNMI from the grip of foreign influence.
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