THE government may withdraw over $23 million in public funds deposited in banks and financial institutions that are not federally insured, in light of the controversies hounding Bank of Saipan.
The government has a $16 million deposit with Bank of Saipan which is not a member of the Federal Deposit Insurance Corp.
Rep. Stanley Torres, chairman of the House Ways and Means Committee, yesterday said the government should re-instate the old deposit safety law, which required all government funds to be deposited in federally insured banks.
Torres, R-Saipan, said a bill is being drafted to amend Public Law 9-13, which allowed government funds to be deposited in non-FDIC banks.
“We have no other choice but to re-instate the old deposit safety requirements,” Torres told Variety.
Public Auditor Mike Sablan, House Speaker Heinz S. Hofschneider, R-Saipan, and Torres met on Monday afternoon to discuss the OPA report on the CNMI government’s deposits in banks and financial institutions.
“We want to require all government deposits to transfer back to FDIC-member banks only. This should not exempt any agency, including the autonomous agencies,” Torres said.
As of Dec. 15, 2001, the government’s total deposits amounted to $105 million.
Of this figure, over $23 million were deposited in non-FDIC member banks and financial institutions—Bank of Saipan, Isla Financial Services, Inc. City Trust Bank and Hong Kong and Shanghai Bank, which, however, is not required to obtain deposit insurance because it has assets in excess of $100 billion.
