Sabino Anastacio
KOROR (Island Times/Pacnews) — The speaker of the House of Delegates, Sabino Anastacio, was ordered to pay taxes, penalties and interest on real estate transactions he conducted in 2015 for which he failed to obtain a license and pay taxes on real estate income of $1.875 million.
The total tax, penalty and interest assessed against Anastacio is $3.5 million. The court also deferred his prosecution for 24 months or until July 2025.
Anastacio at the same time is ordered to obtain a license, obey all laws and pay his taxes by July 2025.
The case, which dates back to 2015, has drawn significant public attention and raised questions about transparency and accountability among Palau’s leadership.
Anastacio’s legal troubles involved a series of real estate transactions conducted between January 2015 and January 2016. During that time, he reportedly earned over $3.27 million from leasing properties in Aimeliik State, particularly in Ngchemiangel Hamlet. One of the key deals was a 49-year lease with Chinese national Qin Zhong that generated a substantial portion of Anastacio’s income. However, according to the investigation, Anastacio failed to obtain a valid business license as required by Palauan law (40 PNC §1501) while conducting these transactions.
Additionally, he is accused of not reporting the income he received from these deals, violating the Unified Tax Act, which mandates that all business-related income be reported for tax purposes.
Anastacio faces up to 10 years in prison and fines of up to $25,000 for misconduct in public office, which is classified as a Class B felony under Palauan law. The charge of tax evasion, considered a misdemeanor, could result in a one-year prison sentence or a fine of $1,000.
However, the court has approved a deferred prosecution agreement, allowing Anastacio to avoid immediate trial. Under the agreement, Anastacio must pay the overdue taxes and obtain a valid business license to continue any real estate activities. If he complies with the terms of the agreement and avoids further legal violations, the charges against him could be dismissed in July 2025. This allows the speaker to rectify the situation without immediate criminal prosecution while his case undergoes scrutiny.
The allegations against him have sparked concerns about the ethical responsibilities of public officials. Many in the community, including legal experts and watchdog groups, have stressed the need for greater transparency and adherence to legal standards among government leaders.
In particular, the case highlights the challenges surrounding accountability in Palau’s public sector, as the investigation revealed the complexities involved in enforcing tax laws, particularly when government officials are involved. The Office of the Special Prosecutor has emphasized the importance of holding public servants to the same legal standards as any other citizen, reiterating that no one is above the law.
The case, overseen by Judge Kathleen M. Salii, remains open and will be closely monitored over the next two years to ensure that Anastacio complies with the conditions of his deferred prosecution. If he fails to meet the terms, such as paying the full amount of back taxes or obtaining the necessary business license, the Republic of Palau reserves the right to resume prosecution, potentially leading to the full reinstatement of charges and corresponding penalties.
The Bureau of Revenue and Taxation, which played a central role in investigating Anastacio’s financial activities, has vowed to remain vigilant in enforcing Palau’s tax laws. The BRT’s findings revealed that Anastacio and his spouse, Kuye Belelai, were engaged in leasing mangrove properties in Aimeliik without proper business partnership or corporation registration, further compounding the legal issues faced by the couple.
The case has broader implications for Palau’s leadership and political environment, with some questioning how widespread such practices might be among other public officials. With Anastacio’s deferred prosecution, the spotlight remains on whether he will fulfill the legal obligations set out by the court, a matter that many will be watching closely.
For now, Anastacio continues in his role as speaker of the House, but his legal entanglements cast a shadow over his tenure. As the legal process unfolds, the case serves as a reminder of the critical importance of ethical governance and the need for accountability at the highest levels of Palau’s government.
