Casino mogul Steve Wynn’s company is under investigation for violating the Federal Corrupt Practices Act stemming from its efforts to enter the Macau market. Wynn is tangled in a messy lawsuit with a former business partner in which both men have lodged bribery allegations. He once poked an elbow through a Picasso painting, which he recently sold. Wynn also and faced off with a kidnapper who took his daughter and paid a ransom before the men were caught.
But Wynn now faces his biggest battle with his ex-wife, Elaine.
Elaine Wynn filed a lawsuit in federal court seeking to sell her shares of Wynn Resorts, which she was awarded as part of their $750 million divorce. The sale of half of her 9.6 percent stake could trigger a series of events that would threaten her ex-husband’s control over the $13 billion casino company and possibly his personal fortune, reports BusinessWeek.
If Wynn’s ex-wife wins in court, that may force the company to buy back $3 billion in bonds. The company is already deep in debt and would likely have to borrow more money to finance such a buyback. That could lead to a lower credit rating and complicate the completion of a $4 billion casino project in Macau. Despite Wynn’s problems, it is tough to feel sorry for a billionaire who made his fortune stripping wealth from gamblers, many of whom can least afford to gamble.
Tags: casino, Elaine, ex-wife, Federal Corrupt Practices Act, investigation, Las Vegas, Macau, Picasso, Steve Wynn
Sheldon Adelson tried to buy the White House. So it is no surprise the casino mogul’s company has admitted that it likely violated a federal law against paying bribes to foreign officials.
With federal prosecutors investigating, the Las Vegas Sands Corp. notified the Securities and Exchange Commission that its audit committee and independent accountants determined “there were likely violations of the books and records and internal controls provisions” of the Foreign Corrupt Practices Act.
The mea culpa comes after Adelson poured tens of millions of dollars into Mitt Romney’s failed bid to unseat President Obama. With no friends in the White House, the Sands appears ready to fess up to some misdeeds, hopefully pay a fine and move on.
Hopefully, prosecutors will press for a full accounting of what occurred. Indeed, the dubious business dealings appear to be widespread and not some one off deal by a rogue employee. In fact, the efforts appear to extend to upper levels of the company.
Steven C. Jacobs, the former president of the Sands operations in Macau, alleged in a wrongful-termination lawsuit that he had been pressured to exercise improper leverage against government officials. He also accused the company of turning a blind eye toward Chinese organized crime figures operating in its casinos.
The New York Times, Wall Street Journal, Reuters, the New Yorker magazine, Frontline and others have detailed some of the Sands’ sleazy business dealings in China, including tens of millions of dollars in payments made through a Chinese intermediary, attempts to set up a trade center in Beijing and sponsor basketball team.
Adelson also reportedly intervened on behalf of the Chinese government to help stall a House resolution condemning the country’s bid for the 2008 Summer Olympics on the basis of its human rights record. Adelson recently sued a Journal reporter for libel in what appears to be an intimidation tactic aimed at quieting the bad press.
Of course, casinos and corruption go together like an ace of hearts and a jack of spades. As more states in the U.S. push to legalize casinos, lawmakers should keep in mind that these are the companies they are doing business with.
Tags: bribes, casino and corruption, federal prosecutors, Foreign Corrupt Practices Act, Las Vegas Sands Corp., Macau, SEC, Sheldon Adelson
Billionaire casino mogul Sheldon Adelson is likely keeping a close eye on the outcome of the presidential race between Barack Obama and Mitt Romney.
But Adelson and other casino operators may be impacted more by the shift in power in China. The Communist Party there holds a once-a-decade congress starting Thursday that will result in a power shift in its leadership. Those new leaders may look to curb the explosive growth in casino gambling in Macau, where Adelson and other U.S. casino operators, like Steve Wynn, now make the bulk of their profits.
As BusinessWeek reports, there may be “concern about Chinese citizens spiriting wealth outside the mainland to Macau in violation of capital controls, as well as the huge profits being made there by U.S. casino companies.”
The new leaders in China could implement policies designed to curb the rampant corruption that is becoming a threat to the Communist Party’s power. No where is the corruption more prevalent than in Macau, a growing casino capital rife with mobs and prostitution. Adelson’s and Wynn’s respective casino companies are under U.S. investigation for violation of the Federal Corrupt Practices Act.
Any crackdown by the new Chinese leaders could stem the flow of money and tourists to Macau, which is an hour ferry ride from west of Hong Kong. About 28 million people, mostly from mainland China, have visited Macau in the 12 months ending in September. Macau’s casinos raked in $33.5 billion last year, more than five times the amount of Las Vegas.
Adelson donated tens of millions of dollars to help defeat Obama. But in the end, his casino empire may be more impacted by what happens in China than who ends up in the White House.
Tags: Barack Obama, casino, China, congress, Election Day, Hong Kong, Macau, Mitt Romney, Sheldon Adelson, White House
The explosion in casinos in Macau has set off a gambling boom in other Asian countries.
Las Vegas-style casinos are planned in Taiwan, the Philippines and South Korea, while Cambodia is expanding its casino. Two casinos that opened in Singapore raked in $6 billion last year. Even Russia is planning to build a casino in the Pacific port city of Vladivostok to cater to gamblers in China.
The gambling boom has many worried.
“If we get casinos in Japan, that will destroy the nation,” said Ken Wakamiya, an author and anti-gambling activist. “Introducing casinos is a plan to rip off our own people. It is an act of madness.”
A 2011 survey by the National council on Problem Gambling found more low-income people are betting bigger amounts, while calls to problem gambling hot lines have increased.
“The gambling industry is not a sector that creates value-added products or services and therefore will have little impact on the development of the future economy,” said Vincent Wijeysingha, treasurer of the opposition Singapore Democratic Party.
Just like the gambling boom in the U.S., the explosion of casinos in Asian countries comes with many of the same economic and social costs. Since the casinos produce little more than losers, the explosion in gambling is a bad bet for just about everyone.
Tags: Asia, casinos, China, economic and social costs, Macau, Philippines, Russia, South Korea, Taiwan
Eight months ago, most people never heard of Sheldon Adelson, the billionaire casino mogul that controls the Las Vegas Sands empire. But many are now getting a fuller picture of how one of the GOP’s biggest donors mixes politics and profits to get what he wants both here and abroad. (Coincidentally, Paul Ryan, the GOP vice presidential pick, will be at a fundraiser today at the Sands’s Venetian casino in Las Vegas, where Adelson is expected to attend.)
A page-one story in The New York Times today details how Adelson used cash, connections and clout to expand his casino empire into China’s Macau region. The story details how Adelson turned to a mysterious businessman named Yang Saixin to help win friends and influence top officials in China. Those often-murky efforts included hiring the daughter of a leading international trade official; trying to buy a Chinese basketball team; and calling former U.S. Rep. Tom Delay regarding a resolution condemning China’s human rights record.
Along the way, Adelson’s company has spent millions of dollars to get better connected in China. Questions of where all the money has gone has led to lawsuits and a federal investigation of whether the Sands has violated bribery provisions in the Foreign Corrupt Practice Act. Adelson denies any wrongdoing.
In addition to the detailed account in The Times, other publications have weighed in with investigative pieces of Adelson’s casino company, including The Wall Street Journal and Pro Publica. (See here and here.) For a list of seven surprising facts about Adelson see here. Before throwing his support behind Mitt Romney, Adelson backed Newt Gingrich in a bid to “destroy Romney,” as The Atlantic detailed here. Connie Bruck’s profile of Adelson in The New Yorker in 2008 also provides excellent into how he operates.
Tags: Foreign Corrupt Practices Act, fundraiser, Las Vegas, Macau, Mitt Romney, Paul Ryan, Sands, Sheldon Adelson, Yang Saixin
Authorities in China’s casino capital – Macau – are shocked, shocked to discover the gambling palaces have become a magnate for crime.
To combat a recent surge in violence, Macau police arrested 150 people in raids at casinos and hotels across the Chinese territory. The arrests were made after a series of brazen murders and attacks, threatened to scare off the many gamblers who flock to Macau. Ng Man-sun was beaten in a restaurant at a casino operated by his company. A Chinese woman was killed in a neighborhood near the Venetian Macau casino, and two men were murdered at the Grand Lapa Hotel, which is operated by Mandarin Oriental International Ltd
The surge in violence was over and above the usual crime that surrounds casinos. Indeed, Macau has a long history of criminal gangs dominating the casino industry there. “Crime comes inevitably with casinos,” Au Kam-sun, a Macau lawmaker, told Bloomberg News. “The police make a clean-up every now and then to keep the triads in check.”
In the late 1990s, deadly gang wars were the norm as criminal groups known as triads fought for control of casino VIP rooms and loan-sharking operations. In 1999, 40 people were killed in shootouts. (So much a night of fun and entertainment touted by casino operators and lawmakers.) ‘Broken Tooth’ Wan Kuok-koi was the leader of the 14k triad that was behind much of the violence. He was sent to prison in 1999 but his 15-year sentence is almost complete.
While the violence in Macau may be extreme, casinos in the U.S. also attract an increase in crime, studies have shown.
Tags: arrests, broken tooth, casinos, crime, Grnad Lapa Hotel, Macau, murder, Venetian Macau Casino
The booming casino market in the Macau region of China appears to be cooling off, impacting the profits of several major U.S. casino companies.
Las Vegas Sands Corp.’s earnings dropped 34 percent in the second quarter, due mainly to a slowdown in Macau, where the company has four casinos. Earlier, Wynn Resorts Inc. announced that its second quarter earnings dropped by 7 percent. Both stocks are down 30 percent since April.
The slowdown could spell trouble for the Sands, which has plans to keep building in Macau. The company, controlled by billionaire Sheldon Adelson, almost went bankrupt during the 2008 financial crisis. But the booming Macau market saved Adelson’s company and has been the main source of profits for the Sands and Wynn in recent years. The growth has also led to legal troubles for both companies, which are under federal investigation for possible violations of the Foreign Corrupt Practices Act. (See here and here.) New questions were raised last week in the probe of Adelson’s company.
Adelson has also emerged as the biggest Republican donor during this year’s election cycle, giving tens of millions of dollars to conservative causes and candidates, including Mitt Romney. Adelson traveled with Romney to Israel over the weekend, where there was a fundraiser and Romney upset Palestinians with his comments.
Tags: investigation, Macau, Sands, Sheldon Adelson, slowdown, Steve Wynn, Wynn
Gov. Martin O’Malley has spent the summer working behind the scenes on a deal to expand gambling in Maryland. His goal is to clear the way for MGM Resorts to partner with a local developer to build a large casino in Prince George’s County.
One issue that has not been addressed: MGM is partners with a family in China that has alleged ties to organized crime? Those ties were enough for New Jersey gambling regulators to balk at MGM’s co-ownership of a casino in Macau with Pansey Ho, the daughter of China casino magnate Stanley Ho who has been linked to organized crime in China.
An investigation by New Jersey gambling regulators did not accuse Pansey Ho of illegal activity but found her “unsuitable” as a business partner because of her financial dependence on her father, who provided 90 percent of the funds she contributed to the MGM casino in Macau. The scrutiny prompted MGM to sell its stake in an Atlantic City casino, choosing instead to keep doing business with Ho in more lucrative Macau.
The question raised by The Washington Post is whether Maryland gambling authorities would have the same concerns as New Jersey regulators. Some think it won’t be an issue, pointing to Las Vegas where MGM owns casinos.
Elected officials all talk about making sure that casinos avoid doing business with organized crime. But in Maryland, where casinos are just getting off the ground, the governor is working overtime to change the state laws to pave the way for a casino company with alleged ties to organized crime. That says all you need to know about how lawmakers look the other way when it comes to doing business with casinos.
Tags: Atlantic City, casino, Las Vegas, Macau, Martin O'Malley, MGM, mob ties, Pansey Ho, Prince George's County, Stanley Ho
When billionaire casino mogul Sheldon Adelson needed help expanding his casino empire in the Chinese territory of Macau he turned to Leonal Alves, a Macau legislator whose firm has been paid about $700,000 to serve as outside counsel to Las Vegas Sands, according to a report in Pro Publica.
The story sheds new light on how Adelson used a well-connected figure in Macau to help the Sands take advantage of the booming gambling market in Macau. One problem: the use of Alves raises questions as to whether the Sands violated the Foreign Corrupt Practices Act, which prohibits American companies from paying foreign officials to “affect or influence any act or decision” for business gain.
The story details various dubious billings Alves submitted on behalf of the Sands. For example, one invoice said Alves billed $25,000 for “expense” in Beijing but provides no further explanation. Alves denies any wrongdoing and said his ”legal services” were unrelated to his government positions.
“I would never use my public offices to benefit the company, nor have I been asked to,” Alves wrote in an email to Pro Publica.
But Alves’ public role clearly didn’t hurt. He sits on the local legislature; belongs to a 10-member council that advises Macau’s chief executive; and is a member of the Chinese People’s Political Consultative Conference, a group that advises China’s central government. Several Las Vegas Sands executives resigned or were fired after expressing concerns about Alves’ billings, including Las Vegas Sands’ general counsel and two top executives at Sands China, its Macau subsidiary, according to Pro Publica.
Tags: Foreign Corrupt Practices Act, Macau, Sands Las Vegas, Sheldon Adelson
Sheldon Adelson isn’t the only billionaire casino mogul giving tens of millions dollars to back efforts to defeat President Obama and elect Republicans to Congress.
Steve Wynn, until recently a Democrat, has been giving millions to Crossroads GPS, a political group founded by GOP strategist Karl Rove, according to Politico. Rove and other conservatives plan to spend $1 billion to defeat Obama, Politico reports.
The story details how Rove courted Wynn, who attended Rove’s wedding and provided a private jet to fly the newlyweds to Italy. Wynn’s lobbyist also has close ties to Mitt Romney. Rove divorced in 2009.
The casino companies controlled by Adelson and Wynn are both under federal investigation for violations of the Foreign Corrupt Practices Act, stemming from their lucrative casino operations in the wild west Chinese territory of Macau. Both casino moguls have emerged as two of the more high-profile GOP supporters who are upending election-year spending in the wake of the Supreme Court’s Citizens United decision that has opened the door to unlimited campaign giving from corporations.
Tags: casino, Crossroads GPS, Foreign Corrupt Practices Act, Karl Rove, Las Vegas, Macau, Politico, Sheldon Adelson, Steve Wynn