BOTTLED WATER VENTURE RAISES QUESTIONS IN KOSRAE

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KOSRAE (Marianas Variety, Mar. 12) – Former Kosrae Assistant Attorney General Edward Buckingham says he resigned in February because of ethical and management concerns relating to state Attorney General, Ron Bickett.

Buckingham, now working as assistant AG on Saipan, was recently subpoenaed by the Kosrae Legislature to testify on the matter.

The legislature’s Resources and Development Committee has been investigating a proposed private water project that seeks to use $3 million in Kosrae’s subaccount to the FSM’s Infrastructure Development Fund.

Questioned by members of the committee, Buckingham said rumors linking himself and Assistant Attorney General Dan Clearman to the project contributed to his decision to resign.

Buckingham said that after reviewing the articles of incorporation for the project, he and Clearman felt it was their duty to offer independent advice to the governor on the issue—"how to best protect the interests of Kosrae...and the use of a substantial amount of funds."

Buckingham swore under oath that the business documents for Tropical Waters Kosrae Inc. were in his opinion legal, but were also "drawn up very carefully and also very complicated." It appeared, he stated, "like a significant potential for the $3 million to be moved off Kosrae very quickly."

A memo provided to the committee states Buckingham’s and Clearman’s concerns of the conflict inherent with a legal advisor working in a public capacity advising money to himself on such a private endeavor.

At the heart of the matter are International Development Fund monies. The Legislature wants to use the IDF resources as Kosrae’s contribution to the FSM Trust Fund, a total of $2.89 million dollars. Bickett, his wife Jeanne and Congressman Claude Phillip have requested the monies to fund their corporation, Tropical Waters Kosrae Inc. — a bottled water venture patterned after a successful enterprise in Fiji.

Funding a private venture entirely with government money, Buckingham stated, "seems to me to be a very different and strange conception of a private business."

Buckingham stated that he did not observe the AG working on any part of the project during working hours. He also stated that he could not determine if the venture would be successful or not. Buckingham said that there were certain "critical requirements" for an AG, specifically experience, management competence, and a fiduciary duty to look out for a client’s interest over personal interests.

The former Assistant AG also said that the state would be well served to research the project thoroughly before committing to a large financial and environmental undertaking, and to ensure "a reasonable assurance that the money will be protected."

March 12, 2003

Marianas Variety: www.mvariety.com 

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