At stake is more nearly $2 million in hotel debts that the retirement agency says will be ignored if the government is allowed to proceed with the sale to a Hawaii-based company known as RC International.
Social Security attorney David Strauss filed the motion Friday, asking the court to name a receiver who would be responsible for selling the hotel — under specific conditions, including that the hotel after sale continue to be operated as a hotel — to pay off the more nearly $2 million the hotel owes Social Security, the government, Marshalls Energy Company, Pacific International Inc., and other companies.
Strauss’ move follows a High-Court issued “hold” on an impending sale of the 150-room, government-owned facility. The Marshall Islands Resort was originally built in 1996 so the Marshall Islands could host its first Pacific Islands Forum heads of state annual meeting. It contains over half of the hotel room space in the country.
The attorney for the prospective buyers said they plan to close the hotel, and then sell individual rooms as “condos” with a permanent resident permit included as part of the sale. But U.S. Embassy officials said they are concerned with any residency scheme that gives the appearance the Marshall Islands is selling citizenship or passports.
The hotel owes Social Security about $450,000 and “has failed to satisfy the judgment in whole or in part,” Strauss said of the earlier court order.
“Since the date of judgment, the asset (hotel) has been wasting away and as each day goes by (Marshall Islands Resort) incurs more debt and the asset depreciates more in value.” He said this makes it unlikely that Social Security can collect what is owed.
He called on the High Court “to appoint a receiver and tailor the receiver’s powers and duties to ensure that the Marshall Islands Resort’s resources are appropriately applied to satisfy Social Security’s judgment and debts owed to other creditors.”
