Acting CPA Executive Director Lee Cabrera, in his interim report to the governor and the Legislature, said the Deloitte & Touche draft audit indicated that the Retirement Fund was to collect $240,000 in interest for the ports authority’s outstanding 2006 employer’s contributions.
CPA incurred a substantial loss resulting from the check-kiting scheme of Information Data Services in Oct. 2006.
IDS prepared the payroll for CPA and other companies like Mobil, the Pacific Islands Club and World Resort.
Cabrera said checks that IDS had written back to CPA, as a result of the suspension of the retirement contributions, were insufficient and rejected by the bank.
Because CPA could not remit employer and employee contributions for several months, the Retirement Fund issued demand letters.
Cabrera said CPA has been paying the Fund in installments — approximately $40,000 per month.
The entire back amount of delinquent contributions will be paid in full by Sept. 2009, he added.
Cabrera said despite CPA’s request that the penalty be waived due to the criminal conduct of IDS, the Retirement Fund still imposed a 25 percent penalty.
The draft audit report also cited concerns regarding the superseding agreement on the sewer line and wharfage fees offset between the Commonwealth Utilities Corp. and CPA.
The report said although CUC finally agreed to the agreement, a formal copy has yet to be seen by the ports authority.
Cabrera said CPA’s financial problems will prevail but the agency will continue to find ways to increase its revenues by resolving food/beverage concession issues and making more sales in food concessions.
