Pago Pago, AMERICAN SAMOA — The Senate Government Operations Committee last Friday continued its investigation into the American Samoa Government’s $10 million investment in a United Arab Emirates pension fund, focusing on the details of the transaction and the entities involved in facilitating the investment. 

Testimony by Brett Butler, Executive Advisor for Finance in the Governor's Office, during the hearing, according to the Chairman of the Senate committee, raised the possibility that Governor Pulaali'i Nikolao Pula could be possibly exposed to impeachment proceedings.

Butler was questioned extensively about the structure of the investment and the government's involvement in the deal, when he was once again called to testify before the Senate GO Committee.

Committee Chairman Sen. Togiola T.A. Tulafono opened the hearing by outlining three key issues that, in the committee's view, required further clarification.

FIRST

Sen. Togoila pointed to a letter from McKinley Beech Tree (MBT) dated September 18, 2026, the same day the first tranche of the investment was scheduled to be disbursed, informing the American Samoa Government that the closing had been delayed. He said the committee was seeking clarification on the relationship between the entity and the company directly involved in negotiating the investment agreement with the UAE government, and whether their respective roles and responsibilities had been clearly defined throughout the transaction process.

SECOND

The Chair noted that the letter, signed by MBT Director Gregory Burkholder, stated that several discrepancies had been identified in the closing settlement statement. However, the correspondence did not specify the nature of those discrepancies or explain how they affected the transaction. He also noted that the letter stated the transaction could not proceed until the identified discrepancies had been resolved.

THIRD

Togiola then raised concerns about the insurance coverage backing the investment, specifically the role of South Pacific Insurance. He said the committee's investigation had determined that the company is owned by ASG's Insurance Commissioner, prompting questions about potential conflicts of interest and the insurer's financial capacity. He asked whether ASG had conducted its own due diligence on the company and whether officials were satisfied that South Pacific Insurance possessed sufficient assets to reimburse the government's $10 million investment should the transaction fail due to unforeseen circumstances.

In response, Brett Butler explained that ASG initially entered into an agreement with McKinley Investments. According to Butler, McKinley subsequently partnered with Beech Tree, a Texas-based company that serves as the front-end entity for the investment initiative currently under discussion with the UAE government.

“That is why you hear the term McKinley Beech Tree, or MBT,” Butler explained. “You have the leadership of these two companies coming together for this transaction with the UAE government.”

Butler further explained that another entity, referred to as a "monetizer," operates between MBT and the UAE government. He said the selected monetizer is the only party with direct lines of communication to UAE government officials regarding the transaction.

Butler said there are approximately six or seven monetizers available, and that MBT determines which monetizer will be used in its dealings with the UAE government.

According to Butler, the selected monetizer is responsible for submitting the required documentation to the UAE government, which then determines when the investment "window of opportunity" opens and when funding will be released.

Responding to Togiola's question about whether ASG's agreement was with McKinley alone or with both McKinley and Beech Tree, Butler said government officials communicate with the leadership of both companies. 

However, he emphasized that while Beech Tree participates in the transaction through its partnership with McKinley, the contractual relationship remains between the ASG and McKinley, making McKinley the entity responsible for final decisions regarding the investment.

Senator Togiola also raised questions about another entity created specifically for the transaction, the Special Purpose Corporation (SPC).

In response, Brett Butler explained that once the UAE government approves the investment, the return funds will initially be deposited into an account in Dubai. After those funds are received by McKinley, a separate company will be established, with ASG holding a 51 percent ownership stake. The company would then open an account at a Swiss bank, where the investment return funds would be deposited.

Butler said the ownership structure would allow ASG to monitor the account and verify the amount of money it contains.

"So the expectation is, the $100 million investment return funds will go there, and we will be able to transfer the tranches of $20 million, $30 million, and $50 million from the Swiss account to the ASG account in Zions Bank," Butler testified.

Asked whether the SPC had already been incorporated and legally established under Swiss law, Butler said the process had not yet been completed because the parties were still awaiting signatures. He added that ASG had withheld its signature pending assurances that it would retain a 51 percent ownership interest, thereby ensuring full visibility into the account and its transactions.

Togiola then asked whether McKinley had provided a timeline for the SPC's formal registration. Butler replied that after McKinley identified discrepancies in the closing settlement statement, it notified the monetizer that the issues would have to be resolved before the closing package could be submitted.

According to Butler, those issues have since been corrected, and the revised closing statement was submitted to the UAE government early last week.

"So right now, we're waiting for the UAE to officially tell us when they're going to fund or open the window of funding," Butler said. "That's where we currently stand."

Togiola asked Butler to identify the monetizer responsible for negotiating the investment transaction with the UAE government.

Butler replied that the company's name was difficult to pronounce because it was foreign, but said he could provide documentation to verify the monetizer's identity and legitimacy.

He explained that the monetizer serves as the direct point of contact with the UAE government, while McKinley Beech Tree (MBT) communicates directly with the monetizer and, in turn, reports developments back to the American Samoa 

GOVERNMENT

Togiola then asked for an update on when ASG could expect to receive the first tranche of the investment returns, noting that the originally anticipated payment date of September 18, 2026, had passed without any funds being received.

Butler responded that officials were expecting the UAE funding window to open either Monday or Tuesday.

"When they open up that window, we have, I would say, no more than 72 hours to have them send the funds from the UAE to the MBT Dubai account, and from there to the Swiss account," Butler explained.

He added that discussions were also underway to expedite the transfer of the government's initial $10.1 million investment.

"So that's the timing right now," Butler said. "We are also in discussion with them to get the $10.1 million here immediately because of the stress we are facing."

Senate President Tuaolo Manaia Fruean questioned Butler about the cost of the insurance coverage obtained for the investment. Butler responded that ASG paid between $200,000 and $300,000 for the insurance wrap.

Butler also disputed suggestions that the ASG Insurance Commissioner had any connection to South Pacific Insurance or involvement in the transaction. According to Butler, the commissioner was neither associated with the company nor involved in any aspect of the investment arrangement.

He explained that ASG was unwilling to release the $10.1 million investment without first securing an insurance wrap to protect the funds. As a result, MBT sought out an insurance provider and ultimately engaged South Pacific Insurance, a Louisiana-based company that, by coincidence, also maintains an office in American Samoa.

Tuaolo then asked whether ASG had sought legal advice from the Attorney General's Office before proceeding with the transaction.

Butler replied that while the government did not obtain a formal legal opinion from the Attorney General, it did seek legal guidance from an escrow attorney retained to ensure the terms and conditions of the escrow agreement were properly followed.

According to Butler, multiple legal reviews were conducted before the funds were transferred.

"When we sent the money out, we received several legal opinions, not from the Attorney General, but from the escrow lawyer we approached to make sure the terms of the escrow were followed," Butler said.

He emphasized that the government did not release the funds until it had received the insurance policy, which he said was a prerequisite for proceeding with the investment transaction.

Chair Sen. Togiola asked Butler to identify the Kansas-based escrow attorney consulted by the government during the transaction process. Butler identified the attorney as Timothy Stein.

Togiola followed up by asking whether Butler was aware of the legal requirement that contracts entered into by the government must be reviewed and approved by the Chief Procurement Officer.

Butler replied that he had only learned the day before that all government contracts are required to go through the CPO's office.

"But these types of contracts, I mean the authority I took to do that, sir, was under the Governor's authority," Butler said.

Togiola then challenged that assertion, questioning the legal basis for bypassing established procurement procedures.

"What is the legal authority of the Governor to make independent contracts without following our procurement laws?" Togiola asked.

Butler said he could not answer the question and would need to seek legal advice regarding the Governor's authority in such matters.

He maintained, however, that the transaction did not involve the procurement of goods or services and should instead be viewed as an investment participation agreement.

Butler reiterated that his involvement stemmed from his role as the Governor's economic and finance advisor and that his objective was to secure an investment opportunity for the territory.

"We were not procuring anything," Butler told the committee, explaining that he viewed the arrangement as an investment transaction rather than a procurement contract.

He further stated that Governor Pulaali'i had raised the matter with the AG’s Office during the course of the negotiations. However, Butler said he was unaware of whether the Governor had also consulted with the Chief Procurement Officer regarding the transaction.

Sen. Togiola also questioned Butler about a meeting he had referenced in previous testimony concerning the investment arrangement. The meeting involved Butler, AG Gwen Tauiliili-Langkilde, and members of the McKinley management team during a video conference call.

Butler testified that throughout the virtual meeting, members of the McKinley management group never activated their cameras or otherwise revealed their identities on screen.

He said he could not say whether the decision was intentional, but acknowledged that their refusal to appear on camera raised concerns for the Attorney General.

According to Butler, AG Tauiliili-Langkilde's suspicions deepened when representatives of McKinley later contacted her through a personal email account rather than an official business email address.

Butler said the combination of the officials' unwillingness to show their faces during the video conference and their use of a personal email account prompted the AG to question the legitimacy of the individuals involved and the manner in which communications were being conducted.

Togiola then turned his attention to Butler's authority to execute an agreement of such magnitude on behalf of the American Samoa Government.

Butler testified that the authority he relied upon came directly from the Governor.

The senator pressed further, asking whether Butler could identify any statute, executive order, or other legal authority that expressly authorized him to sign the agreement in the name of and on behalf of ASG.

"I've not seen any legal authority that authorizes me to do that specifically, sir," Butler replied. "I just took direction from the governor."

Togiola further asked whether the Governor had explicitly instructed him that he could proceed with signing the agreement on behalf of the government.

Butler responded that after reviewing the insurance wrap, the agreement itself, and the discussions surrounding the proposed investment, the Governor gave him permission to execute the document.

Seeking clarification, Togiola asked whether that authorization had been provided in writing.

Butler answered that it had not.

According to Butler, the authorization was given verbally by the Governor rather than through a written directive, executive order, or other formal delegation of authority.

The hearing took a sharper turn when Senator Togiola raised the potential legal implications of Butler's testimony regarding the Governor's verbal authorization.

"Mr. Butler, do you realize that in saying what you just said to the Senate, that these are very probable grounds for impeachment of the Governor?" Togiola asked

Butler declined to comment on the legal ramifications of the Governor's actions, saying his focus had been on securing what he believed to be a beneficial investment opportunity for the territory.

"At the end of the day, this is a very good deal for American Samoa, and if how he did this was incorrect in the eyes of our leaders, I'm not here to answer that question, sir," Butler replied. "I think this is a question the leaders should discuss with the Governor and take to that point. But the focus is trying to bring something that will help the territory, and that's what we are focused on."

Togiola concluded his line of questioning by clarifying that he was not seeking a legal opinion from Butler, but rather emphasizing the significance of the testimony that had just been given before the Senate.

He noted that Butler's statements had raised the possibility that the Governor could be exposed to impeachment proceedings if it were determined that proper legal authority had not been followed.

"Which makes me wonder if you understood the consequences, or the potential consequences, of your statements," Togiola said.