For business tycoon Sheldon Adelson it is the equivalent of salt in the wound.
After spending millions to try and thwart President Barack Obama’s reelection in 2012, Adelson’s
Las Vegas casino empire agreed this week to pay the U.S. government $47.4 million in fines to avoid criminal charges stemming from a money laundering investigation.
Las Vegas Sands Corp., which owns the Venetian Resort Hotel and Casino, agreed to the settlement with the U.S. Department of Justice on Monday night.
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For two years, the Justice Department gathered evidence showing that Chinese-Mexican businessman Zhenli Ye Gon had deposited $45 million in suspected drug money to the Venetian in 2006 and 2007 in a series of complex transactions designed to avoid detection.
Federal law requires that suspicious deposits be reported to U.S. authorities, but Ye Gon was the casino’s best customer, losing more than $90 million at the Venetian’s tables.
RICHARD DREW/AP
Chinese-born businessman Zhenli Ye Gon, who lost more than $90 million at Adelson's Venetian casino, deposited $45 million directly to the casino in 2006 and 2007 in transactions designed to avoid detection.
“For the first time, a casino has faced the very real possibility of a federal criminal case for failing to properly report suspicious funds received from a gambler,” U.S. Attorney André Birotte Jr., who represents the Central District of California, said in a statement.
“This is also the first time a casino has agreed to return those funds to the government,” Birotte said.
“All companies, especially casinos, are now on notice that America’s anti-money laundering laws apply to all people and every corporation, even if that company risks losing its most profitable customer.”
In his statement, Birotte said that the Sands admitted “in hindsight that it failed to fully appreciate the suspicious nature of the information or lack thereof pertaining to Ye Gon.”
While the fine is significant, many investors had anticipated that the Sands would have to settle for an even larger amount. Adelson, who is the CEO and chairman of Las Vegas Sands Corp., has a net worth of more than $20 billion.
The Sands is not out of the woods yet, however. The Justice Department and Securities and Exchange Commission are still conducting a separate investigation into whether the casino empire—which owns resorts in resorts in Macau, Singapore and Pennsylvania—may have violated the Foreign Corrupt Practices Act, the
Las Vegas Review Journal reported.
As the Florida Senate
completes plans to embark on a statewide road show to discuss the future of gambling in Florida, one of the most active players in the quest to bring resort casinos to Florida -- Las Vegas Sands -- has withstood some rocky publicity this week.
According to the
Wall Street Journal, and other news sources, the casino giant has agreed to pay more than $47 million and will accept U.S. Department of Justice's assertion that the company failed to report suspcicious financial activity by a customer who dealt only in cash, and who was later identified as a drug kingpin.
A Sands spokesman told the Wall Street Journal in its Wednesday papers that, "The company cooperated fully in the investigation, and that effort was recognized clearly by the government."
Under the agreement reviewed by the WSJ, Sands has agreed to refrain from using generic names on its customer accounts and must also conduct two years of reviews of its anti-money laundering policies and file periodic reports with the government.
The federal settlement is part of a two-year probe into possible money-laundering at the Sands, the newspaper reported. Investigators at the U.S. Treasury and Justice Department have been concerned that the practices may have enabled some of the casino's most lucrative customers to gamble using proceeds from illegal activities, federal officials said.
Sands officials also disclosed
in its annual report in March that after an internal probe into its casino operations in Macau, the company probably violated the U.S. Foreign Corrupt Practices Act.
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