Inside Asian Gaming

May 2016 inside asian gaming 77 ruled it was overcharged before. Atlantic City has lost nearly 70% of it’s property tax base since 2010, as casino values plummeted after neighboring states themselves legalized casino gambling. Mayor Don Guardian is currently fighting a bid by the state government to take over Atlantic City’s finances, allowing it to sell city assets and cancel contracts with workers’ unions. To this end Guardian recently found US$1.8 million to make a debt service payment, although the city could still soon run out of money. “Financially, we’re running on fumes,” Guardian said. “We really are teetering on the edge.” In November New Jersey’s citizens will vote in a referendum on whether to allow two new casinos near New York city, ending Atlantic City’s state monopoly on gaming. Supporters of the proposal say extra tax revenue from the new venues can be used to help Atlantic City through its troubles. Critics say the American northeast’s growing problem with industry overcapacity will just get worse. Adelson concludes one legal action as another looms Las Vegas Sands agreed to settle a long-running bribery investigation into its Chinese operations. In a deal with the Securities and Exchange Commission (SEC) the operator will pay a US$9 million fine but won’t have to admit any guilt. In return the SEC will close its investigation into possible violations of the US Foreign Corrupt Practices Act (FCPA). According to Steve Jacobs, a former company executive who is suing his ex-employer for wrongful dismissal, Las Vegas Sands paid a well connected go-between named Yang Saixin more than US$62 million to hide its transfer of money to officials in the Chinese government. The SEC followed Jacobs’ accusation by launching its investigation in 2011. Ultimately it only found Sands guilty of not keeping required documentation of the payments. Sands will have to hire an independent consultant for two years to ensure future FCPA compliance, on top of its US$9 million penalty. Jacobs’ lawsuit is ongoing, with trial fixed to start on June 27 in Nevada. INTERNATIONAL BRIEFS In a separate development a court in Macau gave the go- ahead for a lawsuit against Sands initiated by Taiwanese businessman Martial Hao. Hao and his company Asian American Entertainment (AAE) are accusing Sands Chairman Sheldon Adelson of ditching him for another partner – Galaxy Entertainment – during their joint bid for a Macau gaming concession 13 years ago. According to the suit, Sands and Galaxy together then made “a near identical bid … using details that were exclusive to the previous partnership.” AAE wants US$5 billion from Sands for breaking the terms of their partnership, plus more than 70% of Sands’ profits from 2004 to 2022. Based on accounts filed until 2015, this would exceed US$8 billion. Sands had taken legal action to stop Hao’s suit, and maintains his claims have no merit. Hao’s lawyer Jorge Menezes told Reuters he expects a hearing to be scheduled in the coming months. Imperial Pacific appoints advisory committee Hong Kong-listed Imperial Pacific International Holdings said it has set up a three-man committee to advise the firm. Its members are all senior American ex- officials: former Governor of Pennsylvania Edward Rendell, former Governor of New York David Paterson, and former director of the FBI Louis Freeh (pictured). “The main function of the advisory committee is to provide the management of the company with sound strategic and tactical advice on issues that the group may face from time to time, including but not limited to business strategies and government relations,” said a company announcement. Imperial Pacific added, “The board has determined that the establishment of the advisory committee with members who have considerable experience of governmental and regulatory policies will strengthen the company’s corporate governance.” Freeh was hired by Steve Wynn to investigate his business partner Kazuo Okada, who at the time was the largest shareholder in their joint venture Wynn Resorts. The former Fed-chief concluded Okada had bribed officials in the Philippines to obtain a gaming license there, in violation of US anti-corruption laws. In 2012 Wynn used Freeh’s report to justify the ousting of Okada. Imperial Pacific currently operates a 48-table casino on Saipan in the US Commonwealth of the Northern Mariana Islands and last year started work on a US$500 million expansion there named Grand Mariana. In a recent interview with Inside Asian Gaming , the project’s CEO Mark Brown said trust in American regulators was a factor in attracting Chinese high rollers to gamble there.