Ads by Google Ads by Google

ASTCA defaults on repayment of ASG Retirement Fund loan

ASTCA building
$4.25 million was due last Saturday — but no payment was made

Pago Pago, AMERICAN SAMOA — Chairman of the American Samoa Government's Employees' Retirement Fund (ASGERF) Board of Trustees, Vaanatiu Toafala Iafeta, warns that if the American Samoa Telecommunications Authority (ASTCA) does not address their loan default, the ASGERF "shall proceed to manage, monetize, operate, or dispose of the ASGERF's rights and interest granted to the ASGERF under the December 2017 Agreement" under which the ASGERF loaned $17 million to ASTCA in form of an investment.

This was spelled out in a December 10th letter from Vaanatiu to ASTCA board chairman, Fai'ivae Alex Godinet.

According to Vaanatiu, ASTCA is in default of an Agreement that went into effect December 8, 2017.

"As of the close of business on Dec. 8, 2018, the ASGERF had not received its $4.25 million payment from ASTCA, as required under the December 2017 agreement," Vaanatiu wrote, adding that pursuant to Section 5.2 ASTCA is required to pay the ASGERF the amount by last Saturday, Dec. 8, 2018.

"This letter shall serve as written notice of default of the December 2017 Agreement," Vaanatiu continued.

Copies of the letter were cc'd to ASTCA chief executive officer Lewis Wolman, and ASGERF executive director, I'aulualo Talia Faafetai.

As reported earlier by Samoa News, ASTCA has proposed to pay the $17 million back with monies from the new bond series set to be sold this month. Furthermore, the semi-autonomous agency has proposed that they not pay any interest on the loan, something the ASGERF director and board members do not support.

ASTCA officials had — in past Fono hearings — also expressed the need to "break from making payments" for a couple of years, to allow them time to get back on track, financially, and to take full advantage of the Hawaiki Cable.

However, Samoa News understands the Agreement between ASTCA and ASGERF specifically points to one of the purposes the Retirement Fund entered into the agreement is to receive a monetary return — whether by being repaid in a timely manner as set forth by the Agreement or if ASTCA defaults, selling it’s rights and interest granted to it by the Agreement outright or taking on additional investors and partners.

Samoa News reported last week that Tualauta Representative-elect, Larry Sanitoa wrote to Senate President Gaoteote Palaie Tofau earlier this month saying, "The financial crisis at ASTCA needs to be fully investigated and dealt with."

According to Sanitoa, "Recent reports show ASTCA only gave Hawaiki Cable an amount of $14.7 million. Where is the rest of the money?"