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02/23/2012
Japanese gambling tycoon Kazuo Okada was accused Tuesday in a US lawsuit of paying off Philippine regulators and cheating his powerful Las Vegas partner.
The two regulators named are former Philippine Amusement and Gaming Corp. (Pagcor) chairman Efraim Genuino and incumbent chairman Cristino “Bong” Naguiat and their family members as the recipients of the payoffs which dated from 2008 until 2011.
Steve Wynn of Wynn Resorts said Okada spent more than $110,000 to
Foreign Corrupt Practices Act, jeopardizing Wynn’s own reputation in the process.
“Mr. Okada, his associates and companies appear to have engaged in a longstanding practice of making payments and gifts to his two chief gaming regulators at the Philippines Amusement and Gaming Corporation (Pagcor), who directly oversee and regulate Mr. Okada’s provisional licensing agreement to operate in that company,” the lawsuit said.
The suit, filed Tuesday in Las Vegas district court, said that Okada had sought a gaming license in the Philippines and made the payments despite Wynn’s telling him not to do so.
Okada, the Japan’s pachinko king and a director of Wynn, went behind the company’s back to develop business for his own Universal Entertainment group in the Philippines and broke US laws on foreign bribery, the lawsuit alleges.
Okada told a Wynn investigator that he had paid for Genuino’s trip to the 2008 Beijing Olympics, Wynn said.
“Okada’s conduct poses a direct assault upon, and a threat to, Wynn Resorts’ reputation for probity, which is central to maintaining its stature in the gaming industry as well as its current and future licensing.”
The lawsuit followed a lengthy internal investigation by Wynn, which hired former US Federal Bureau of Investigation chief Robert Freeh to conduct the probe.
Wynn said the probe found that Okada had used Wynn’s name to advance his own interests in the Philippines.
It also said the Okada, when asked about his actions by the Wynn board, insisted that it was “customary” to give gifts to officials in Asia, via intermediaries.
Universal, through Aruze USA, was one of four winners of provisional gaming licenses awarded by the Philippine government in 2008 to last year, 2011.
It broke ground for its Manila Bay Resorts casino on Jan.26, promising ultimately more than 2,000 guest rooms in three hotels, with the planned opening in the first half of 2014.
The Wynn lawsuit accused Okada of undermining its own business in Macau by seeking to attract Chinese high-rollers to the Philippines casino.
Pagcor confirmed Wednesday that top officials accepted free luxury accommodation from a Okada but denied these were bribes to ensure a new Manila casino was built.
The top officials’ relatives and associates were also beneficiaries, as was the current chairman’s nanny and the husband of then-president Gloria Arroyo, the suit alleged.
Pagcor Vice President Francis Hernando told AFP Wednesday that current Pagcor chairman Cristino Naguiat and other officials had accepted free hotel stays at Wynn’s Macau resort, but said this was standard business practice.
“They were complimentary rooms extended as a basic courtesy,” Hernando said.
“This is standard practice not limited to the casino industry, for the airlines, as well. For hotels (the hotel industry) it’s the same thing.”
The suit alleged that Naguiat, his wife, three children, nanny and company officials had a five-day trip to Wynn’s Macau resort in 2010 during which Okada met with the Pagcor chairman to discuss his Manila casino venture.