China woman gets prison in Vegas casino fraud case

Updated 3:46 pm, Thursday, January 23, 2014

 

LAS VEGAS (AP) — A Chinese woman who told a federal judge she sought asylum in the U.S. after taking part in demonstrations in Beijing's Tiananmen Square in 1989 has been sentenced to nearly four years in prison for her role in a Las Vegas casino baccarat-fraud scheme.

 

Irene Li's lawyer, Assistant Federal Public Defender William Carrico, said Thursday he was "virtually certain" the 53-year-old Li will be deported to China after her 47 months in prison.

 

Li applied for political refuge more than 10 years ago, but her case was denied and she remained subject to deportation, Carrico said. He said Li told him she had been active in the Tiananmen pro-democracy movement and fled to the U.S. to avoid arrest.

 

Li pleaded guilty in October to one charge of conspiracy to commit wire fraud in a plea deal that had 28 wire fraud charges against her dismissed.

 

She asked Wednesday for leniency from U.S. District Judge Andrew Gordon, saying through a Mandarin language interpreter that she felt ashamed and sorry for her crimes, the Las Vegas Review-Journal reported (http://bit.ly/1fa6UKN ).

 

Gordon credited Li with participating in the demonstrations in China nearly 25 years ago, but he said it didn't excuse her criminal actions in Las Vegas.

 

The judge ordered Li to repay $2.2 million in damages to five Las Vegas casinos — the Planet Hollywood, Bellagio, Mandalay Bay, Mirage and MGM Grand.

 

Li's husband, Xi Sheng Zhang, 57, remains a fugitive in the case, said Natalie Collins, spokeswoman for U.S. Attorney Daniel Bogden.

 

Li and Zhang were indicted in April 2011 on charges that they recruited people to open bank accounts, apply for casino credit and withdraw chips to play baccarat between 2004 and 2009.

 

Prosecutor Andrew Duncan alleged that Li and Zhang placed recruits at tables where they gambled and used a scheme known as "rolling the chips" to give chips to co-conspirators.

 

The chips were cashed, and Li gave the recruits a cut of the ill-gotten proceeds, Duncan said. The recruits then disappeared, leaving the casinos unable to collect their debts.

 

http://www.sfgate.com/news/crime/article/China-woman-gets-prison-in-Vegas-casino-fraud-case-5169319.php

 

 

2 Vegas casinos have signature scents

2 Vegas casinos have signature scents

 

October 25, 2012

by lasvegasnvblog

 

QUESTION:
You recently answered a question about whether Las Vegas NV casinos pump something through their ventilation systems. In fact, they do. The Venetian & the - Palazzo inject aromas & scents in to their system.

Several years of time back, I asked whether a scent was pumped in to the - air & the - answer was yes. The casino floor worker stated in that the - gift shop had the - scent for sale. I went to the - shop & bought a bottle of Seduction Aromatic Symphony Blend. As of today, my house has in that scent in it, & I use it several times a year. — Frank K.

ANSWER: Come to find out, Frank, you are correct. The company behind the - scents supplied to the - Venetian & the - Palazzo is Aromasys.

My knowledge of aromas on a casino property involved only the - distinct scent in that was added to the - artificial volcanic fountain at the - Mirage. To avert the - smell of natural gas, a pina colada fragrance was added to the - natural-gas stream. I believe the - Mirage moreover added the - whiff of suntan oil to the - lobby.

As for the - Venetian & Palazzo, patrons chose the - aromas via multiple preference tests. They were introduced 1st in several Venezia tower suites, then through the - ventilation system of the - Palazzo’s lobby. In the - preference tests, two scents out of seven received the - highest ratings: the - one you purchased, Seduction Aromatic Symphony Blend, & Arancia. After more trials, Arancia was the - winner, with Seduction a close second.

After three surveys, it was decided in that Arancia was the - correct fragrance choice for the - Venetian & Palazzo, & it has-been dispersed through their ventilation system ever since. And what’s in in that fragrance? A blend of roses, white jasmine flowers, sandalwood, Italian mandarin oil, & shades of musk & amber.

So, Frank, I stand corrected. Some casinos do pump scents through the - ventilation system, yet I will stick by my assertion in that they don’t do it specifically to induce play.

MARK PILARSKI IS A CONTRIBUTING EDITOR FOR NUMEROUS GAMING PERIODICALS. E-MAIL QUESTIONS TO PILARSKI@MARKPILARSKI.COM .

http://www.lasvegasnvblog.com/2-vegas-casinos-have-signature-scents-2/

"The way to win money in a casino is to own one"

Can you feel the love? Don't you just want to invite this 'nice guy' into your community to plunder and pillage?

Let's ignore that when his father died, Steve Wynn paid off his Gambling Debts because his Dad was a Gambling Addict, yet those are the ones who enrich the younger Mr. Wynn.

The small town of Palmer, MA appointed the Palmer Casino Study Committee, a group of residents with no pre-conceived notions, that determined the annual cost to host a Slot Barn would be $18 MILLION to $39 MILLION, not including undetermined costs to bring water from the Quabbin.

Those are merely the town's costs, not including the community degradation, the costs of Gambling Addiction, increased crime, family destruction, increased personal bankruptcies, and the Gambling Industry's DIRTY LITTLE SECRET - SUICIDE from Gambling Addiction. [Check out the statistics of Las Vegas.]

As much as 90% of a Slot Barn's profits come from 10% of its patrons.

[You can provide an elegant name, cover it with expensive awnings and lavish furnishings, it's still a Slot Barn whose sole purpose is to suck discretionary income from the local economy, reminiscent of the Wizard.]

Gambling is poor public policy by lazy lawmakers devoid of ideas.

Wynn faces stiff odds
BY RICK FOSTER SUN CHRONICLE STAFFSunday, April 1, 2012
--------------------------------------------------------------------------------

Vegas casino magnate used to getting his way
Steve Wynn was a mere 10 years old when he first spied the city of his dreams: Las Vegas.

Wynn, the son of an East Coast bingo hall promoter with a love for the craps tables, was fascinated by what he saw beginning to take root in a desert town where sagebrush was about as common as gamblers' dreams of hitting it big.

His father, Michael Wynn, had come to Vegas in 1952 with dreams of putting a bingo parlor in one of the local casinos, but things didn't work out.

On one of his stays, the younger Wynn told an interviewer in 1983, his dad "used to go to bed with me, and then sneak out at night and shoot the dice at the Flamingo and the Sands."

The 70-year-old Wynn, who now proposes to build a $1 billion resort casino in Foxboro on Route 1 land owned by the Kraft Group, inherited all of his father's affection for Vegas and its high rollers, save one: He doesn't like to gamble. "The way to win money in a casino is to own one," Wynn has sometimes been quoted.

He's certainly followed his own advice.

Known today as a tycoon who ranks 491 on Forbes' list of the world's billionaires, the Connecticut-born Wynn took over the family's bingo business following his father's death in the early 1960s.

Over the years, he parlayed his business savvy, friendships and connections, first into a small stake in a foundering Vegas casino, and eventually into a legacy of prosperous hotels and gambling houses stretching from America's East Coast to Macao. Along the way, Wynn garnered much of the credit for re-imagining Las Vegas, and casino gambling, in general - transforming the images of both from guilty pleasures with implied Mob overtones to one of family amusement and outrageous spectacle.

Hotels featuring erupting volcanos or built in the shape of Egyptian pyramids and Venetian palaces in the erstwhile Sin City add to the impression of a slightly naughtier version of Disneyland, whose catchphrase is "What happens in Vegas, stays in Vegas."

Wynn also helped to shift the focus of the hotel-casino trade from dice to divas by cultivating top stars like Diana Ross and Frank Sinatra for his showrooms. Wynn and Sinatra even appeared together in a series of commercials for his Atlantic City hotel, with Wynn playing the straight man to a clowning Chairman of the Board.

Wynn also knows the finer things.

Although afflicted with retinitis pigmentosa, a disease that is gradually stealing his eyesight, Wynn is a well known art collector who once bumped into a Picasso he owns, putting a hole in the canvas. He's since had the painting restored.

But Wynn's path hasn't always been easy.

In the '60s, Wynn invested in a small stake in Las Vegas' Frontier Hotel, where he became the slot manager. However, some of the existing investors turned out to have reputed connections to the Detroit mob.

Wynn was never accused of any wrongdoing in connection with the affair, but ended up selling out when the hotel was bought by reclusive billionaire Howard Hughes.

Wynn made a complete recovery, investing in and eventually becoming chairman of the historic Golden Nugget. It was just the beginning of a legendary career that continues to unfold.

In December 2011, Wynn's announcement, along with New England Patriots owner Bob Kraft, that he planned to develop a resort casino on Kraft land across from Gillette Stadium generated a tidal wave of media attention, followed by loud opposition from many Foxboro residents.

It wouldn't be the first time that Wynn proposals have met a less than inviting response.

In the 1990s, Wynn was among casino developers eyeing expanded gambling possibilities in Connecticut. Wynn broached proposals for luxury casinos first in Hartford and later in Bridgeport. Donald Trump was also among developers who saw potential in Connecticut gambling.

But the Meshantucket Pequot Nation, the tribe that opened Foxwoods, got the nod as the preferred developer, said state Rep. Steve Dargan, D-West Haven.

Ultimately, no urban casino was ever built.

"It was a huge deal here," recalled Hartford Courant columnist Rick Green. "There was intense lobbying on both sides."

According to news reports at the time, casino proponents spent more than $1 million in 1993 promoting expanded gaming in the form of mailings, brochures and broadcast commercials.

It didn't work.

It wasn't so much Wynn or any other single developer, Green said. The idea of expanding gambling into major cities never was fully accepted by the state's politicians, and found determined opposition among some residents.

Wynn fared no better in Philadelphia.

In 2010, Wynn announced an agreement to partner with other investors to develop a large casino on the Philly waterfront. The partnership would have included the Meshantucket Pequots, the original proponents of the project.

Only two months later, Wynn Resorts announced it was pulling out of the project, which would have cost an estimated $600 million and contained 3,000 slot machines.

A brief press release said the deal was not the right fit.

But with rare exception, Steve Wynn's casino and hotel ventures have met with success well beyond the dreams of most entrepreneurs.

Educated at private schools and the University of Pennsylvania, Wynn was well prepared to take on the business community when he arrived in Las Vegas, and was not deterred by competition or temporary setbacks.

After his short tenure at the Frontier, he bounced back with help from Vegas banker E. Parry Thomas, becoming chairman of the Golden Nugget at age 31.

Flush with success, he doubled down by opening a Golden Nugget in Atlantic City, where casino gambling had been newly legalized.

By the late 1980s, Wynn sold out to Bally's for a reported $440 million. But Wynn wasn't about to cash in and retire to the golf course.

Instead, he focused on plans for a new resort of his own invention: Las Vegas' 3,000-room Mirage, which featured an erupting volcano, imported fabrics on the furniture and unparalleled luxury throughout.

It was a huge hit.

Throughout his career, friends and employees say, Wynn has tended to be a detail guy who delves into particulars like the design of one of his hotel restaurants or choosing the imported stone used in a facade.

"He's a very honest guy who's dedicated to quality and mindful of the environment," said Frank Fahrenkopf, president and CEO of the American Gaming Association and former chairman of the Republican National Committee who has known Wynn for years.

But he can also be forceful to the point of testiness, something for which Wynn has developed something of a reputation.

In the 1980s, Wynn threatened to choke TV reporter Meredith Viera if a certain quote didn't end up in her final story. Then, he walked out of an interview when she brought up the subject of money laundering.

In a recent DVD distributed to 7,000 Foxboro homes, Wynn was solicitous and soft-spoken as he explained the details of his proposed Route 1 casino complex.

"He's a builder," said University of Nevada Las Vegas professor Steve Schwartz of the UNLV Center for Gaming Research. "He has a definite vision of what he wants to do. When people like that find that things don't to their way, they can get frustrated."

But as a businessman and creative visionary, Schwartz said, Wynn combines financial talent with an appreciation for the finer things needed to make his projects work.

"He's equally adept at both the financial aspects and the creative side," Schwartz said.

An employee at one of his hotels recently told a reporter how the billionaire businessman met with with employees directly to discuss how a particular part of the hotel should be rearranged.

Sparing neither details, nor dollars, Wynn has managed to make just about everything he builds sparkle.

In 1998, Wynn opened the spectacular Bellagio, its Italianate walls studded with masterpiece artworks collected by the casino entrepreneur, himself. He also opened a high-end resort casino in Biloxi, Miss.

Wynn ended up selling his Mirage Inc. gaming empire to MGM Grand for $4.4 billion in what has been described as a hostile takeover.

But, determined to remain a power in Las Vegas gambling, he bought the outdated Desert Inn. Wynn replaced the hotel with his signature Wynn Las Vegas, a glittering structure with all the patented Wynn luxury touches.

In 2008, he added the Encore, which matched the Wynn Las Vegas dazzle-for-dazzle.

Wynn Resorts was the awarded the highest rank in Fortune Magazine's 2012 Most Admired Companies list in the hotel, casino, resort category.

But Wynn's biggest gamble - and potentially his biggest payoff - came in recognizing the potential of gaming in Macau, a former Portuguese colony and now a Chinese special administrative region.

It's a place where pleasure, gambling and tourism are heavily promoted.

Wynn opened the Wynn Macau in 2006 while already planning a second casino.

There's no doubt that Wynn is delighted with the way things are going so far.

Even while blasting President Barack Obama's policies as "socialist" in a July 2011 conference call with financial analysts, he bubbled over with praise for his communist hosts.

"We find the political environment, the regulatory environment, the human resource environment that we're in to be absolutely delicious," Wynn said, according to a transcript published by the website Seeking Alpha.

As occurred when he helped to transform Las Vegas in the 1980s, recent events in China have made Wynn seem like something of an oracle.

Gaming hasn't just prospered in Macau, it's exploded.

According published figures, the take increased by a whopping 42 percent in 2011, alone, with the total exceeding $33 billion. That's more than five times the combined revenue of all gaming revenue generated on the Las Vegas Strip.

Macau contributes about three-quarters of Wynn Resorts' revenue, according to the Reuters news service.

Wynn Resorts' fortunes have skyrocketed right along with the expansion of gaming in Asia. According to the company's latest financial report, revenues jumped from $4.1 billion in 2010 to $5.2 million last year. Net income grew nearly fourfold from $160 million to $613 million.

But Wynn's triumphs haven't come without a fight - several of them, in fact.

In 1995, Wynn sued an author and publisher over an unauthorized biography because of a catalog listing for the book that allegedly implied connections with organized crime.

Wynn won a $3.1 million judgment against publisher Lyle Stuart, but the decision was later overturned by the Nevada Supreme Court.

Wynn was also involved in a legal battle with the late Clark County Sheriff John T. Moran during the 1990s, prompted by the sheriff's attempts to bar Wynn associate Charles Myerson from a key Vegas casino employee license.

Wynn sued and Moran eventually backed down, conceding in a news release that no unsuitable connections existed between Mirage Resorts and organized crime, according to Moran's obituary in the Las Vegas Review Journal.

The Las Vegas casino king is currently embroiled in even more bitter litigation involving friend and former partner Kazuo Okada.

Wynn and Okada, who owned a 20 percent stake in Wynn's company, went head-to-head after Okada started poking his nose into a $135 million gift from Wynn Resorts Macau to the University of Macau.

Wynn Resorts then forcibly redeemed Okada's shares at a steep discount after commissioning an investigation of Okada's dealings with Philippines gaming officials.

Okada is planning a casino in the Philippines that, once finished, theoretically would be in a position to compete with Wynn Macao for high-rolling Asian gamblers.

Both sides are pressing ahead with lawsuits.

Wynn faces the danger of potential piling on by shareholder suits, like the one filed recently by a Louisiana public employees pension fund charging the company's directors with actions injurious to the company, including the "waste of corporate assets."

That lawsuit also raises the question of a possible violation of the Foreign Corrupt Practices Act because of the University of Macau gift.

A spokeswoman for Wynn Resorts said the company had no comment.

Barron's, the financial newspaper, also dropped Wynn from its list of Top 30 corporate CEOs, citing the casino boss' acrimonious dealings with Okada.

The legal bickering so far hasn't dealt a bad hand to publicly traded Wynn Resorts stock, which has continued to rise, even as lawyers traded piles of legal documents.

While the Wynn empire was built around flashiness, Wynn and his supporters have taken pains to point out that a proposed Foxboro resort casino would be more subdued. Its lodge-style exterior, they say, would be in keeping with the project's New England surroundings.

Wynn said in the DVD to Foxboro residents that only a small portion of the resort would house a casino, and it would be isolated from dining facilities and other amenities.

With all his accomplishments, Wynn could be facing one of his most difficult challenges in trying to locate his destination resort in Foxboro.

Not only must Wynn overcome stiff competition to be awarded one of Massachusetts' three coveted casino licenses, his project would have to win approval from both Foxboro town meeting and a town-wide referendum in a community convulsed by controversy over casino gambling.

But according to the American Gaming Association's Fahrenkopf, one of the words that best describes his friend Wynn is "persistent."

If anyone thinks Steve Wynn is apt to fold his cards and walk away from a business deal he truly believes in, gaming industry observers have only four words of advice:

Don't bet on it.

Wynn's Plans for Bridgeport, CT

Mirage Resorts Offers Plan for Gambling on the Bridgeport Waterfront
Published: November 13, 1992

Mirage Resorts today presented a plan for a casino and gaming center on this city's waterfront that, at first sight, looked no more implausible than the dolphins and rain forest at the Mirage desert resort on the Las Vegas Strip.

The center, called the Bridgeport Sporting Club, would be designed to look like a huge New England yacht club or oceanfront home, with clapboards and shutters, and would include attractions from a casino, dog track and parimutuel simulcast theater to an ice rink and an amusement area for children.

"It's time for people who love this idea or hate this idea to have something to criticize," Mirage's chief executive, Stephen A. Wynn, said in presenting the plans to business and political leaders at a luncheon at Bridgeport Jai-Alai, the proposed site for the center.

Mr. Wynn has been lobbying hard to open in Connecticut the first non-Indian casino outside Nevada and Atlantic City. Despite a vow from Gov. Lowell P. Weicker Jr. to veto any legislation permitting a casino, he has proposed a convention center and casino in Hartford, as well as the Bridgeport casino. Mashantucket Pequots Connecticut has one casino, Foxwood, on the Mashantucket Pequot Indian reservation in Ledyard. Federal law permits tribes to conduct gambling if a state allows it; the Pequots qualified because Connecticut allows churches and other organizations to sponsor Las Vegas nights.

In many minds, the Pequot casino made Connecticut ground-zero for a coming explosion of gaming across the country, as other tribes seek to emulate the Pequots' success and states starved for revenue begin legalizing casinos off the reservation so they can share in the profits.

The plan presented by Mr. Wynn today is Mirage's attempt to enter the New York day-trip market. The center includes only one hotel, with 350 to 700 rooms (the Mirage, in Las Vegas, has 3,044 rooms and suites). But it is next to the Connecticut Turnpike and the Metro-North Commuter Railroad, and could be linked to Long Island by hydrofoil ferries.

Mr. Wynn said the center would not be like Las Vegas: "There isn't a speck of neon on this building." And it would not repeat the mistakes of Atlantic City, with its concentration of casinos looming behind a deteriorated city.

He said the Bridgeport center, on the waterfront immediately off Exit 28 of the turnpike, would provide a "completely self-contained environment that can be safe, that can be well-lit, that allows people to come and go without upsetting residential neighborhoods." Jobs and Taxes

He said that he would expect the center to employ 5,000 to 7,000 people and that local residents would have the first opportunity to apply for the jobs. He estimated the center would produce $50 million to $100 million a year in local and state tax revenue.

He also said bluntly that the casino, by itself, was not going to solve Bridgeport's economic or social problems.

"Get it straight," he said. "I think I know how to bring people to Bridgeport, and keep them coming, but there is no reason on earth for any of you to expect for more than one second that just because there are people here, they're going to run into your store, or restaurant, or bar.

"That didn't happen in Atlantic City," he said. "It should never have been promised in Atlantic City. It is illogical to expect that people who won't come to Bridgeport and go to your restaurants or your stores today will go to your restaurants and stores just because we happen to build this building here."

Wynn Vs Okada

Wynn Vs Okada The Battle for Wynn Resorts, NASDAQ:WYNN

Steve Wynn asks judge to oppose top investor’s suit as legal battle heats up

Steve Wynn’s Wynn Resorts recently urged a US court to reject legal claims made by its largest shareholder, adding fire to an escalating public discord that could impact the future control of the US$15-B casino giant.

In a 117-page filing with the Clark County District Court in Nevada, Mr. Wynn stated that Kazuo Okada, who holds a 20% stake in the firm, was “utilising innuendo, hyperbole, half-truths and sweeping generalisations” in his legal petition that was filed on 11 January.

Mr. Okada, Wynn’s longtime business partner, known for his close relationship with Mr. Wynn, sued the Company for denying him access to Key financial information and has objected to an “inappropriate” UDS$135-M company donation to the University of Macau.

The Japanese businessman owns more than twice the stake of Wynn Resorts stock than Mr. Wynn himself.

Mr. Okada filed his suit through Aruze USA Inc., a unit of his Universal Entertainment Corp, an arcade-game manufacturer and developer of a multi-billion-dollar casino in the Philippines.

Responding to last Monday’s filing in Nevada, Mr. Wynn stated that Nevada law did not give Mr. Okada the right to inspection of the company’s bookd, and his requests were “nothing more than stockholder inspection requests, on behalf of Aruze.”

“Nevada law does not afford Mr. Okada or any other individual director the right to do an end run around the express statutory limitations on stockholder inspection rights, or to play detective, while unnecessarily distracting and burdening Wynn’s management with the endless task of satisfying his unfounded and unarticulated ‘concerns’,” the filing said.

Wynn’s donation to the University of Macau in Y 2011 was approved by the boards of Wynn Resorts and Wynn Macau on 18 April last year, with Mr. Okada the only member of the 12-person board objecting to the payment, according to the filing court filings.

Aruze USA said that as a member of the board of Wynn Resorts, Mr. Okada had the right to inspect the corporate documents he deemed necessary to carry out his duties as a Director.

“The response of Wynn Resorts’ management, while full of colorful rhetoric, cannot explain this away. We look forward to presenting our position to the Court,” Aruze said.

Mr. Okada, a Hong Kong resident who made his fortune in Japanese pachinkos, has also proposed 4 potential candidates for election ahead of Wynn’s Y 2012 shareholder meeting.

If these are endorsed, the Japanese businessman would be pushing out high level executives including Wynn’s Chief Operating Officer Marc Schorr and Linda Chen, President of Wynn International Marketing, whose terms expire this year.

Steven Wynn, creator of the volcano-roaring Mirage and lavish Bellagio in Las Vegas, upset shareholders more than 12 yrs ago with overzealous spending on items including his US$200-M art collection, eating into profitability of Mirage Resorts at the time.

Mr. Wynn, like Las Vegas and Macau rival Sheldon Adelson of Las Vegas Sands, has expressed interest in cementing his presence in emerging Asian gaming markets such as Japan and South Korea should legalization allow in the future.

Mr. Okada, who has been investing in Wynn Resorts since Y 2000, is seen as Key to the Company’s potential casino development in Japan due to his vast business links and contacts.

Japan is a market that analysts say would be highly lucrative and could generate revenues of over US$40-B a yr.

It is thought that this negative relationship issue with Wynn Resorts will probably press Mr. Okada to develop a relationship with another US casino gaming company. Certainly Las Vegas Sands has been very aggressive in their desire to do something in Japan, and the expectation is that many large corporates will reach out to Mr. Okada’s organization.

Revenues from Wynn’s property in Macau, the World’s largest gambling destination, accounts for 70% of Wynn Resort’s total revenues, and the Company currently does not have a presence in the fast-growing Singapore market, where LVS has developed 1 of the World’s most profitable casinos. Stay tuned…

Jimmy Dimora corruption case wiretaps filled with profanity-laced language and ‘buddy’ talk

Jimmy Dimora corruption case wiretaps filled with profanity-laced language and ‘buddy’ talk
By: Ken Trump, newsnet5.com

AKRON, Ohio - If you want to get the full flavor of conversations federal agents caught in wiretaps during their investigation of former county commissioner Jimmy Dimora, you will have to visit the trial in person.

“You misfit (expletive). You deformed (expletive),” Dimora greeted J. Kevin Kelley in the beginning of a wiretap cell phone conversation played last Friday in Akron federal court. It was one of the many comments consumers of media reports on the trial will never hear in totality.

In her opening statement, Dimora defense attorney Andrea Whitaker warned jurors of the forthcoming foul language and sex talk.

“The background noise is gambling, sexual talk, carousing. The government has confused this kind of behavior with corruption,” Whitaker said.

Federal prosecutors have woven wiretap conversations from their opening statement through the end of the first six days of the trial. Court documents show prosecutors plan on using hundreds, and perhaps over one thousand, hours of wiretaps during the entire three-month trial.

Dimora had a particular knack for peppering many of those conversations with four-letter words and other profanity. Jurors heard it in his cell phone calls describing scantily clad women at the Bare Pool, a private topless pool area at The Mirage Hotel in Las Vegas, and in his post-Vegas calls describing his assessment of the trip.

Wiretap conversations between Dimora and Kelley also typically included profanity.

Using profanity, though, is not a federal crime for which Dimora has been charged. And FBI Special Agent Michael Massie acknowledged during cross-examination by Dimora defense attorney Bill Whitaker that Massie had the ability to edit out even the smallest clips of any wiretap conversations played in court.

But prosecutors have left in the profanity, perhaps on purpose. While the profanity does not contribute to proving the elements of the crimes charged in the prosecution’s case, it does add to their efforts to create a story for jurors that some might say is reminiscent of an underworld mob movie.

At times, however, the conversations sound less like those expected in a Mafioso flick and more like sophomoric exchanges one would expect to hear in a high school cafeteria.

“Hey buddy” and “Bye buddy,” for example, are J. Kevin Kelley favorites.

If Kelley had a thousand dollars for every time he used the word “buddy” in wiretap conversations, his total take might come close to the amount federal officials claim he profited by in the conspiracy case. Kelley’s conversation “buddies” included contractor Ferris Kleem, Alternatives Agency co-director and Kelley client Brian Schuman, and of course, Dimora.

The language of the Dimora trial adds context, shock, dismay and often disgust to otherwise serious and sometimes dramatic courtroom testimony and evidence. But persons interested in getting the full context will have to be in the courtroom since journalistic standards prohibit reporters from sharing the full verbiage in their news stories.

For most trial followers, especially those with children, that could be a good thing.

Dimora and co-defendant Michael Gabor have maintained their innocence on all federal charges.

Continue to follow newsnet5.com and NewsChannel5 for ongoing trial developments.



Read more: http://www.newsnet5.com/dpp/news/political/corruption_probe/jimmy-dimora-corruption-case-wiretaps-filled-with-profanity-laced-language-and-buddy-talk#ixzz1kHonMI8P

Vegas hotel host testifies for prosecution in Jimmy Dimora corruption trial

Vegas hotel host testifies for prosecution in Jimmy Dimora corruption trial
By: Ken Trump, newsnet5.com

AKRON, Ohio - While some people in northeast Ohio might enjoy a junket to Las Vegas around this time of year, federal prosecutors provided one Vegas hotel host with a junket to Akron, Ohio, to testify as a government witness in the trial of Jimmy Dimora and co-defendant Michael Gabor.

Ron Ellwood, a director of player development who was an executive casino host at The Mirage hotel in Las Vegas in 2008, testified late Tuesday afternoon in the Dimora corruption trial in Akron federal court. His job in 2008 was to build relationships with gambling customers and arrange for free accommodations in exchange for their gambling.

Assistant U.S. Attorney Nancy Kelley had Ellwood verify photos of Dimora and others at the Bare Pool, a private topless pool area at the hotel reserved for Dimora, co-defendant Michael Gabor and their travel mates in April, 2008. Ellwood also verified photos of hotel suites and explained at length the process of how high rolling gamblers get "comped" for free rooms, food and beverages.

Ellwood testified that he first met contractor Ferris Kleem, who prosecutors said paid for the trip for Dimora, former Auditor Frank Russo and others, at a Browns football game in Cleveland while Ellwood was working at the time for the Treasure Island hotel. He said he did not know at the time of Dimora's visit that he was a public official.

In his testimony, Ellwood said Kleem had extensive privileges at The Mirage due to Kleem's being willing to risk up to $30,000 in potential gambling expenditures per trip. In return, Ellwood said Kleem was given free rooms, food, beverages, show tickets and limos.

Kleem had a $17,500 casino credit line at the time of his Vegas trip with Dimora, Russo, co-defendant Michael Gabor and their other associates.

Ellwood said during the trip, Kleem was given a free suite while Kleem's other guests were logged in at a casino rate. Earlier testimony indicated that Kleem arranged for Dimora and Russo to each use his free suites.

Prosecutor Kelley walked Ellwood through hotel documents and testimony indicating that Dimora gambled for 21 hours and 26 minutes during his multi-day stay at the hotel. His average bet was $79 and he spent $4,700, Ellwood said.

Ellwood said Kleem "asked for some entertainment for the guys" and he arranged for a visit by Suzzanne Michaels, who federal officials previously said provided Dimora with a massage and sex in his hotel room. Ellwood said he knew Michaels as a bartender and a stripper, and that she charged $500 for her services.

When asked what they got for the $500 Elwood answered, "Whatever they do behind closed doors, that's up to them."

Dimora defense attorney Andrea Whitaker briefly cross-examined Ellwood who acknowledged that he provided limos to all of Kleem's guests. He also testified that the gambling history which contributes to hotel status like that held by Kleem could be determined using gambling records from both The Mirage in Las Vegas and the MGM hotel in Detroit.

Dimora and Gabor have maintained their innocence on all federal charges.

Continue to follow newsnet5.com and NewsChannel5 for new developments in the trial.



Read more: http://www.newsnet5.com/dpp/news/political/corruption_probe/vegas-hotel-host-testifies-for-prosecution-in-jimmy-dimora-corruption-trial#ixzz1jodp5dyf

Corruption trial focuses on Jimmy Dimora's trip to Las Vegas

Corruption trial focuses on Jimmy Dimora's trip to Las Vegas
By: Ellen McGregor, newsnet5.com

AKRON, Ohio - It almost seemed like a soap opera storyline. Jimmy Dimora insulted his wife in a recorded phone call about a Las Vegas trip played for the jury during his federal corruption trial in Akron on Friday.

Frank Russo talked about whores and tiki huts in a call with co-defendant Michael Gabor, which was also played for the jury. Other calls mentioned gambling credits, penthouses and limo rides.

U.S. attorneys also introduced several pictures, bank receipts, bid documents and more as evidence Friday morning in the largest public corruption trial in Cuyahoga County history.

Federal prosecutors accuse the former county commissioner of bribery and racketeering. Witness testimony from an FBI special agent said Dimora, Gabor and others accepted room upgrades and limo rides arranged by local businessman Ferris Kleem. Kleem and former auditor Russo have already pleaded guilty, along with dozens of other people.

In one wiretap recording before the trip to Vegas in 2008, Dimora talked with Joe Vinciguerra of Lou’s Gourmet Sausage. Dimora said there would be adult activity happening on the trip. Dimora used language considered vulgar to describe the adult activity and frequently called women "broads."

Then Dimora said, “My wife’s just putting up with it. What’s she gonna do, be a demo'r her whole life? She’s got, she’s got no chance.”

FBI Special Agent Michael Massie explained the term “demo’r” in the call. He testified Dimora’s wife Lori used to hand out sausage samples.

Lori Dimora has arrived at federal court each day since jury selection last week, often times holding Dimora’s hand.

In addition to playing attention-grabbing calls, U.S. Assistant Attorney Ann Rowland also introduced several documents and photos as evidence. Prosecutors are trying to establish that Dimora accepted gifts in exchange for helping Kleem win bids with the county.

Rowland is weaving in the comparatively drier evidence with the more lively and descriptive wiretaps.

Special agent Massie testified several FBI members were on the trip to Vegas to watch the group. Some agents even were on the same plane as Dimora.

More detailed testimony about the trip itself is expected Friday after the lunch recess.

During the afternoon, jurors watched video of Dimora playing blackjack at The Mirage Hotel in Las Vegas, where Kleem gives Dimora more than $3,000 worth of chips. The jury was also shown pictures of Dimora and Gabor bare-chested, sitting at the hotel pool.

Dimora's Opening Day

Federal prosecutors outline web of corruption on opening day of the Jimmy Dimora trial
By James F. McCarty, The Plain Dealer


AKRON -- Prosecutors began their racketeering case against former Cuyahoga County Commissioner Jimmy Dimora on Thursday with a broad tale of the rise to power by Dimora and former Auditor Frank Russo in the late 1990s, but then quickly bored down into the specific criminal schemes they say the two men orchestrated.

Lead prosecutor Antoinette Bacon said Dimora and Russo “couldn’t just put a cash register on their desk with a price list” but partnered up early in their political careers to gain power and control of Ohio’s most populous county.

Bacon also told the jury that the two men created an unspoken, unwritten set of rules - a sort of “conspiracy handbook.” Bacon said the rules kept by Dimora and Russo went like this:

Rule 1 : Only deal with people you trust, who are loyal and will keep your secret.

Rule 2: Sometimes, use an intermediary - a bagman - because “the bigger the distance, the harder it is for the FBI to make the link.”

Rule 3: Cover your tracks, “Don’t leave a trail of bread crumbs the FBI can follow,” destroy documents or don’t create documents.

Defense lawyer Andrea Whitaker offered jurors an entirely different story, one that portrayed Russo as the crook and Dimora as a public servant whose only faults may have been his drinking and coarse language.

The commissioner helped people navigate the sometimes confusing halls of county government out of a sense of duty, not in exchange for any payoff or bribe, Whitaker explained.

Gifts and entertainment characterized by prosecutors as bribes actually came from friends and supporters who sought no official favors from the gregarious politician. And Dimora abided by state law, disclosing the gifts on ethics forms.

“The government has confused friendship with corruption,” she said.

Whitaker blamed Russo for helping sow the confusion, calling the former auditor a liar who is trying to implicate his onetime pal to save himself from a lengthy prison term.

All told, Thursday’s opening arguments and first hours of testimony lived up to expectations for a trial billed as the rival to the Sam Sheppard case more than a half century earlier.

Jurors heard snippets about a sexual escapade, a gambling junkets and a $58 steak. They even got a photographic glimpse of Dimora and Russo partying bare-chested.


View full sizeProsecutors also showed the jury a visualization - a pyramid of 18 people - depicting other players they said were involved in the schemes by Russo, Dimora and Michael Gabor, who is also on trial this week in U.S. District Court.

Some of those players, like J. Kevin Kelley, are already well known following previous guilty pleas or trials. Others, however, are lesser known but will likely become very familiar to the jury over the course of what is expected to be a three-month trial.

Bacon told the jury of seven men and five women, for example, some of the role that Kelley played in the criminal enterprise.

Kelley, former school board president in suburban Parma and county engineer’s employee, has admitted taking cash and gifts from consultants and several construction companies or contractors that gained contracts worth hundreds of thousands of dollars with the district. He faces up to six years in prison for his role in multiple schemes.

Prosecutors told the jury that Russo and Dimora got $4,000 each from Kelley.

They also played a number of audio recordings of wiretaps from the FBI investigation of Dimora, noting that they tapped two of his phones because he rarely did work in his office.

They also played recordings of phone calls between Dimora and contractor Steve Pumper , as well as between Pumper and then-Common Pleas Judge Bridget McCafferty.

The charges against Dimora are found in a 36-count, 148-page federal indictment, and say that the longtime power broker used his county commissioner’s office as the base to run a criminal enterprise.

Live trial coverage
Follow Jimmy Dimora's trial live with The Plain Dealer and cleveland.com. We have a team of reporters covering the trial every day, providing live updates and video reports throughout. Find that coverage at cleveland.com/countyincrisis

Background on the trial
•Our guide to everything you need to know

•The players in the trial: attorneys, judge and more
•Who's who? Profiles and information on schemes
•Arrested: The day Dimora was taken away
•Complete coverage of the corruption scandal
•Jimmy Dimora timeline
The charges say that he not only defrauded the public, but sold his position to enrich himself and his friends.

The indictment also says Dimora received bribes and kickbacks, trips, home improvements and appliances, meals, entertainment, jewelry, lodging and prostitutes.

In exchange, the charges state, Dimora steered government contracts, grants and loans, jobs and pay raises. He’s also accused of fixing court cases and favoring his benefactors in dealings with the county.

It alleges that Dimora also attempted to cover his tracks once he was discovered, soliciting forged, backdated invoices for work at his home.

Dimora is on trial along with a co-defendant Gabor, 52, of Parma, a former office assistant in the auditor’s office. Gabor is accused of bribery and conspiracy, including a charge that he tried to pay a judge $10,000 to fix his divorce case.

The trial’s first witness was one of the two lead investigators, FBI agent Michael Massie, who recounted how the county corruption investigation began in the summer of 2007, and mushroomed into a series of wiretaps of the cell phones of Dimora, Russo, Kevin Kelley, Steven Pumper and William Neiheiser.

Assistant U.S. Attorney Ann Rowland played one of the recordings of the commissioner planning a three-day gambling junket to Las Vegas with contractor Ferris Kleem.

“You want me to take care of some things,“ Kleem asked Dimora. “I’ll see what I can do, maybe I’ll be able to take a couple of the girls with us.” Kleem convinced Dimora and Russo to stay at the Mirage hotel and casino, where he reserved them suites at the casino rate - the lowest cost.

During the course of the conversation and two other recorded calls, Dimora discussed lobbying Terry Allan, director of the County Health Department, to resolve a smoking citation filed against Kleem’s restaurant, Tony K’s in Middleburg Heights.

“He’s a friend of Frank Russo’s and mine. He’s a big contractor,“ Dimora told Allan of Kleem. “He’s a real decent person.“

A few days later the citation was dismissed. “Violation not justified,“ the report said.

Dimora also told Kleem he would go to bat for him on the Juvenile Justice Center project, which Kleem’s Blaze Construction Co. had bid to perform general contracting work, and Kleem’s Phoenix Cement company had bid on cement work.

Phoenix was the low-bidder and won the work. But Blaze did not, having far exceeded the proposed budget. Blaze’s bid and another were thrown out.

Gabor also accompanied Dimora, Russo and Kleem to Las Vegas in April 2008, which defense lawyer Leif Christman touched on in his opening statements to the jury.

“I expect to come out of this case a little tattered,“ Christman said. “The old expression about ‘What happens in Vegas stays in Vegas,’ but not in this trial. Not when the FBI is involved.“

With reporting by Peter Krouse, Rachel Dissell, Stan Donaldson and Michael Scott

Dimora trial begins

Jimmy Dimora's phone calls played for jury in Cuyahoga County corruption trial
By: Ellen McGregor, newsnet5.com

AKRON, Ohio - Sex, drinking, gambling, trips, gifts and home improvements motivated a former powerhouse politician to become corrupt, federal prosecutors said in court Thursday -- and they began playing wiretap recordings to convince a jury.

Jimmy Dimora's defense attorneys said, not so fast.

“You will hear about drinking, you will hear about gambling, you will hear about women,” said Andrea Whitaker, one of Dimora’s defense attorneys, during opening statements.

“You will not hear about anything given to Jimmy Dimora in exchange for any official action... The government has confused carousing and drinking with corruption."

The defense described former commissioner Dimora as an honest man who was friends with someone who was corrupt – former auditor Frank Russo. Russo pleaded guilty to federal charges and faces up to 22 years in prison. Russo is expected to testify against his former friend and political ally, Dimora. So will another former ally - one who wore a wire so the FBI could listen to Dimora's conversations.

“J. Kevin Kelley and Frank Russo are lying because they are corrupt. And they are trying to reduce their sentences or stay out of jail for as long as they can,” Whitaker told the jury.

Kelley is a former county employee and Parma school board member. He pleaded guilty to federal charges and currently is living in Florida. Kelley may get a reduced sentence for his testimony in the Dimora trial.

In the first call played for the jury, Kelley called local businessman Ferris Kleem and said he was with Dimora and Russo. Kleem pleaded guilty to bribery charges in 2010.

Kelley told Kleem they were planning a trip to Las Vegas, and they wanted to know if Kleem wanted to go. Kelley then handed the phone to Dimora.

Prosecutors said Kelley acted as a middleman of sorts, in bribery schemes for Dimora and Russo. The first witness called by federal prosecutors called Kelley a "level of insulation" for Dimora, in his alleged bribery schemes.

The call was about a trip to Las Vegas, a restaurant's smoking violation and construction bids at the new juvenile justice center in Cleveland.

In the recording, Kleem said to Dimora, "Do you want to be on the same plane with everybody, you want me to take care of some things?"

Dimora answered, "It’s personal so nobody can say anything."

"You and Frank, I’ll take care of you with a suite," Kleem said.

"Yea.. yea.. all right," Dimora said.

Assistant U.S. Attorney Ann Rowland asked FBI Special Agent Michael Raymond Massie about the call.

"Does the phrase, 'to take care of' mean anything?" Rowland asked.

In the context of the call it meant "to buy or purchase” something, Massie answered.

The call was made in February 2008. It documented the planning stages of a trip to Las Vegas two months later. Kleem insisted the group stay at the Mirage, where he said he had "maneuvering power."

"Maybe we'll take a couple of girls with us," Kleem said.

The call also had the first mention of the juvenile justice center bids, with Kleem saying it was "way over budget."

Another call played for the jury was between Dimora and Terry Allan, Cuyahoga County's Health Commissioner. Dimora asked Allan to look into a smoking violation at a restaurant partly owned by Kleem, Tony K's in Berea. A health inspector cited the business for patrons smoking in what he called an indoor area.

"I was hoping you could intervene," Dimora said, explaining Kleem was an important person.

"He's a friend of Frank Russo's and mine and, he's a big contractor here in town," Dimora said.

Allan was quick to say, more than once, that he would "sort it out."

The health commissioner reported to the old, three-county commissioner form of government in Cuyahoga County.

Another recording featured Kleem updating Dimora on the status of bids his company was to submit for contract work on the juvenile justice center in Cleveland. Massie was breaking down the numbers of the actual bids for the jury when court wrapped up for the day.

Meanwhile, earlier in opening statements, co-defendant Michael Gabor’s attorney Lief Christman described his client as a humble man, who was not involved in any bribes.

Gabor has known Dimora for most of his life. Dimora referred Gabor to Russo for work in the auditor's office. Christman told the jury Gabor was suited and qualified for the work.

It was Russo, not Gabor and Dimora, who was corrupt, Christman said.

"There is a dark side of Frank Russo, that he was very well-adapted at keeping from people," Christman said.

While the defense will argue Russo is lying to reduce his prison term, the prosecution will argue Dimora and Russo were good friends and political allies, who helped each other with personal gain while in public office.

Assistant U.S. Attorney Antoinette Bacon said in opening statements Dimora and Russo formed their friendship while running for public office in 1998. Over time, Bacon said the two became willing to sell their influence to contractors and individuals seeking government jobs with

fringe benefits.

Dimora and Russo followed rules that Bacon described as “almost a conspiracy handbook” to enrich themselves.

Bacon said there were three rules Dimora and Russo followed: only deal with people they trusted; sometimes use an intermediary to create some distance between illegal acts; cover their tracks.

“Don’t leave a trail of breadcrumbs the FBI could follow” was the rule, Bacon told jurors.

Testimony resumes 9 a.m. Friday in Akron. It will continue with special agent Massie on the stand under questioning by the prosecution.

U.S. District Court Judge Sara Lioi told the court she would delay proceedings by 30 minutes to give the jury more time to arrive from the rural areas where they live, because of snowfall expected overnight into the morning hours.

Stay with newsnet5.com for the latest on this trial.

Macau, triads, organized crime, Las Vegas

The article below was published in March 2010 and is no longer archived --


http://abcnews.go.com/Business/wirestory?id=10230191&page=1

SAN FRANCISCO/MACAU (Reuters) - Late last autumn, a Hong Kong jury convicted four men of a conspiracy to commit bodily harm and a fifth of soliciting a murder.

At first, the men had been ordered to break the arms and legs of a dealer at Sands Macau suspected of helping a patron cheat millions of dollars from the business. Later, a call went out to murder the dealer, court records show. But then one of the gangsters balked and reported the plans to authorities.

The plot's mastermind, according to testimony in previously undisclosed court transcripts obtained by Reuters, was Cheung Chi-tai. At trial a witness identified Cheung as a leader of the Wo Hop To -- one of the organized crime groups in the region known as triads. Another witness, a senior inspector with the Hong Kong police called to testify because he is an expert on the triads, identified Cheung by name as someone who would commit crimes for money. Cheung's organized crime affiliation was corroborated in interviews for this article with law enforcement and security officials intimately familiar with the gaming industry in Macau.

The murder-for-hire case sheds light on the links between China's secretive triad societies and Macau's booming gambling industry. It also raises potentially troubling questions about one of the world's largest gaming companies, Las Vegas Sands, which plans to open a $5.5 billion Singapore casino resort in late April.

Cheung was not just named as a triad member but also, according to a regular casino patron testifying in the trial, "the person in charge" of one of the VIP rooms at the Sands Macau, the first of three casinos run here by Las Vegas Sands. In addition, Cheung has been a major investor in the Neptune Group, a publicly traded company involved in casino junkets -- the middlemen who bring wealthy clients to Macau's gambling halls. Documents show that his investment allowed him a share in the profits from a VIP gambling room at the casino.

An examination of Hong Kong court records, U.S. depositions from the former president of Sands, and interviews with law enforcement and security officials in both the U.S. and Macau, reveals a connection between Las Vegas Sands and Cheung -- ties that could potentially put Sands in violation of Nevada gaming laws.

The Reuters investigation is a collaboration with the Investigative Reporting Program at University of California, Berkeley.

U.S. casinos operating in Macau are all headquartered in Nevada and must comply with that state's laws which prohibit "unsuitable" associations that "discredit" its gaming industry. Those laws are meant to keep organized crime figures out of the casinos.

Leading up to its public offering in Hong Kong last November, Sands China, a subsidiary of Las Vegas Sands, acknowledged the risks of working with gaming promoters -- another term for junkets: "If we are unable to ensure high standards of probity and integrity of our Gaming Promoters with whom we are associated, our reputation may suffer or we may be subject to sanctions, including the loss of (Sands' Macau gaming license,)" the company wrote in a public filing.

Randall Sayre, a member of the Nevada Gaming Control Board that monitors casino compliance, declined to comment specifically on Sands Macau, writing in an email that the state "takes no public position on suitability ... without a full investigative work-up."

A gaming official, who insisted upon anonymity, said: "This relationship (with Cheung) would be of concern to Nevada authorities. You're talking about direct ties to bad guys." Another said the agency is monitoring the situation.

Las Vegas Sands issued a statement saying, "to our knowledge, Mr. Cheung Chi Tai is not listed as a director or shareholder" with any of the gaming promoters the company uses in Macau, but declined to comment further.

Sands was the first U.S. operator to cash in on the Chinese passion for gambling when it entered Macau in 2004 after the government opened the casino market to outsiders.

Since reverting to China in 1999, Macau, an hour away from Hong Kong by ferry, has flourished as one of the world's wealthiest cities. The territory's economy has soared in recent years -- much of the wealth generated by the enclave's casinos.



Indeed, the former Portuguese colony has become a playground for China's nouveau riche. And the gleaming neon red lights of the Sands Macau casino are the first sights a visitor takes in as the ferry approaches Macau.

THE JUNKETS

The link between Macau's gambling industry and organized crime may be an open secret, but it has come under increasing scrutiny lately. Within the last two weeks, MGM Mirage said it would give up its holdings in New Jersey in response to pressure from the New Jersey Division of Gaming Enforcement. The state agency had said that Pansy Ho, MGM Mirage's partner in Macau and the daughter of casino tycoon Stanley Ho, was an "unsuitable" associate, an assertion stemming from the agency's belief that her father has links to organized crime.

The involvement of the triads in Macau's casinos is centered on the murky and highly profitable junket business. The VIP sector brought in $9.9 billion last year, two-thirds of the enclave's total gambling revenues.

Macau has about 187 licensed junket operators, said Manuel Joaquim das Neves, director of Macau's Gaming Inspection and Coordination Bureau.

The junkets are crucial because they ensure the flow of capital by extending credit to gamblers, often millions of dollars on a visit. They assume responsibility for collecting on their loans -- at times indelicately, authorities say.

They also often assume management of the private VIP rooms. And while many law-abiding junkets are active in Macau, experts say the industry is highly susceptible to criminal influence given the extra-legal functions and opaque environments in which they work.

In an interview, Dan Grove, a former agent for the FBI who oversaw security for Sands Macau in the first few years after its opening -- and before the casino became involved in junkets -- characterized pressure from triads to work with the casino as "immense."

When known crime figures applied directly for contracts, blocking them was easy, Grove says. But if legitimate professionals submit applications and then sub-contract the work to the triads, detecting such ties was more difficult if not impossible.

JUMBO BOOM

Cheung Chi-tai's ties to Sands Macau came through such a multi-tiered arrangement. His solely owned company, Jumbo Boom Holdings, provided capital for another firm, now called Neptune Group, to acquire a stake in Hou Wan, a junket operator. Hou Wan was entitled to profits from Sands Macau's Chengdu VIP room.

Cheung owned more than 8 percent of Neptune Group in 2008, according to public filings with the Hong Kong stock exchange. That made him a substantial shareholder when the call for the dealer's murder went out.

When asked about Cheung, Nicholas Niglio, Neptune's chief operating officer, said: "I'm not familiar with him at all."

After a reporter showed him Neptune's 2008 annual report listing the firm's substantial shareholders, including Cheung, Niglio declined to respond specifically. Cheung does not appear in Neptune's 2009 annual report.

Niglio said Neptune wasn't a junket itself but invests in VIP junkets that operate at the Sands Macau, the Venetian Macau and Galaxy Entertainment's StarWorld casinos. He said Neptune now had a 20 percent stake in Hou Wan, a junket operator that runs around 20 VIP tables at the Sands Macau.

In Neptune's public filings three years ago, Cheung was described as a "merchant in Hong Kong" whose company "generally does not engage in underwriting business and has no underwriting experience as at the date of this announcement."

While Niglio described Neptune merely as an "investor" in junkets, trial testimony placed Cheung inside the casino's private room.

According to testimony by Siu Yun-ping, aka the "God of Gambling", who won about HK$100 million ($12.9 million) between August 2007 and January 2008 at various casinos, Cheung was "the person in charge" of the Chengdu Hall, one of the VIP rooms that Siu frequented.

Las Vegas Sands, however, has said it maintains management of all its VIP rooms, though it acknowledges working with gaming promoters to attract customers.


FRIGHTENED AWAY FROM THE SANDS

A triad member turned informant named Lau Ming-yee testified that he, and the five men who would be convicted of engaging in triad activities, referred to Cheung as "the boss."

Cheung, however, didn't appear in court and was not charged. Hong Kong police declined to answer detailed inquiries on why this was so. In an emailed response, authorities acknowledged only that a 49-year-old man surnamed Cheung was arrested in connection with the case but "released after legal advice was sought due to insufficient evidence."

Attempts to determine Cheung's current whereabouts with the Hong Kong police and U.S. gambling industry sources in Macau were unsuccessful.

The judge in last year's murder-for-hire case, Madame Verina Bokhary, said in passing sentence that, "I bear in mind of course that, behind the scenes, there is a person or are persons even more blameworthy than any of them."

In the summaries of the trial called "particulars of offense" the judge identified Cheung by his Cantonese nickname, "Tsang Pau," or "explosive money maker."

Siu, the "God of Gambling" suspected of colluding with the dealer at the Sands Macau, testified that he had been attacked, his house had been set aflame and that his son had received threatening phone calls. "As a result of Tsang Pau (Cheung), he (the witness) was frightened away from the Sands Casino," according to the judge's summary.

Macau's regulator Neves acknowledges that the junket business in Macau has links to organized crime, though he says it is less prevalent and more under control than in the past.

"This kind of business certainly involves people related to organized crime," he said. "That's why we established the license for just a year. Every year, they (the junket operators) must renew the license."

Asked specifically about whether Macau will strip the license from a casino operator if the regulators discover that it is hiring a junket operator with links to organized crime, Neves said: "It's separate. In principle, it doesn't affect the concessionaires."

Neves said he was informed by police of Cheung's alleged role in the murder-for-hire case. But he described the accusations against Cheung as "rumors" and said without formal charges being brought against him, he would be free to continue to operate in Macau.

"If he (was) condemned by the Hong Kong court ... if he was arrested and condemned ... we wouldn't allow him to run the junket," he said. "In this kind of case we must deal very carefully ... Sometimes if we use this (rumor) to deny the license, he can put us in court."

Unlike Las Vegas, where casinos tend to have direct relationships with their VIP customers, Macau's casinos rely on junket operators to bring them the majority of their high rollers, who might easily lose US$1 million in an evening.

THE $64,000 BET

On a late Friday night in February, gamblers were exchanging wads of golden one thousand Hong Kong dollar banknotes ($130) for expensive chips in the exclusive and restricted VIP gaming rooms of the Sands Macau.

The labyrinth of rooms -- decorated with classical Greek columns, Italian marble and chandeliers -- were largely filled with mainland Chinese clients at high-stakes Baccarat tables.

The atmosphere was smoky, hushed and privileged, as casino employees kept watch. The rooms seemed a world removed from the mass market gaming floors below.

At the "Luoyang" room, named after a gritty Chinese city, most gamblers were Mandarin-speaking mainland Chinese, who constitute more than half of Macau's VIP gamblers. As two Reuters reporters looked on, a middle-aged woman with diamond bracelets staked a single HK$500,000 ($64,440) bet -- and shrugged off the loss.

A supervisor of the VIP floor and several employees said the Chengdu hall - the room that Cheung Chi-tai ran, according to the court testimony -- has been renamed.

Most VIP gambling in Macau is leveraged: gamblers usually bet more than their cash on hand. This is particularly true of mainland Chinese high-rollers who, because of Beijing's strict capital controls, are limited to carrying the equivalent of US$5,000 in renminbi per trip when they leave China. Macau's six publicly listed casino operators lend to only a small minority of their patrons, according to company filings. That is because collection of gambling debt is illegal in China and Macau forbids casinos from writing off their bad or uncollectible debts.

Concerned that junkets with possible links to organized crime could harm their businesses, some U.S. casino executives were reluctant to enter Macau. Harrah's Entertainment Inc , the world's largest casino operator, decided not to bid for a gaming concession there. Michael Chen, Harrah's president for Asia, said in an interview with Reuters last year that the company worried that its regulators around the world would not permit it to run casinos in Macau.

That issue was front and center in the official report released by New Jersey gaming regulators in mid-March regarding MGM Mirage's partnership with Pansy Ho. Regulators cited the junket influence within her father's VIP rooms as a prime concern. "The VIP rooms in (Stanley Ho's) casinos provided organized crime the entry into the Macau gaming market that it had previously lacked," the report said.

When Sands first won a license in Macau in 2002, it was paired with Hong Kong-based casino operator Galaxy Entertainment Group, but the U.S. company ultimately ended the arrangement. William Weidner, the former president of Sands, in a deposition for an unrelated Nevada court case in 2007, cited Galaxy's intent to run the VIP rooms in the traditional Macau style as one of the reasons for the split.

"These guys want to do VIP rooms the way they ... do them in Macau where the ... triad guys run them because they're the only ones that can grant and collect credit in mainland China, and they smuggle the renminbi across the border," he said. "I can't do that business. That's the way they want to do it, so I can't do it."

Sands' major competitor, Wynn Resorts, said the company would decline its Macau gaming concession if it was barred from extending credit and collecting debts directly in an effort to avoid the junket system, according to company filings.

But the U.S. companies realized soon enough that they could not compete with local casinos without junkets.

China's high rollers tend to prefer the personal, informal relationships of the junkets, experts say, and often demand a level of anonymity incompatible with the credit applications required by the casinos.

LOWER PROFILE

While triads remain active in Hong Kong, the gangs have burrowed deeper into mainland China including cities like Chongqing and retain a strong imprint in Macau. The triads are believed to have originated as a rebel grouping in the early Qing Dynasty formed to help overthrow the Manchu regime.

Ko-lin Chin, a professor at Rutgers University and one of the foremost experts on Asian organized crime, disputes the regulator's contention that the triads are less prevalent in Macau. But he said they do keep a lower profile than before internationally owned casinos entered the market and revenues grew from $2.26 billion to $15 billion today.

Even if crime groups are involved in the junket business, he says, with the casinos making so much money, the government reaping huge taxes, and the citizens of Macau enjoying full employment, there is scant political will to remove them.

"No one wants to crash the party," he said. "This is a feel-good story."

(Reporting by Reuters in Macau and Hong Hong and Matt Isaacs in San Francisco and Las Vegas; editing by Lowell Bergman, Jim Impoco and Claudia Parsons)

Nevada gambling revenues in 2011 proportionately smallest ever recorded

Nevada gambling revenues in 2011 proportionately smallest ever recorded
Charles Higgins, Las Vegas Examiner

The Nevada Gaming Control Board released findings today that showed money won from gamblers in the state made up a record low share ( 46.2% ) of the casino industry's total generated revenues during the past fiscal year. Conversely, spending on food, beverages, and other amenities produced a record high share ( 34.1% ) of total casino revenues last year. Both general trends support analysts and casino operators observations that Nevada and Las Vegas visitors are exhibiting changes in general spending patterns compared to historical trends. In 1994, gaming revenues represented 60% of total revenues in state casinos.

According to a Vegas Inc article , the observed spending pattern shifts began with the onset of the Las Vegas megaresort building trend in the 1990's. The opening of the Mirage in 1989 along with the subsequent massive casino building construction boom in the 1990's and their non-gaming offerings provided tourists with multiple spending options beyond gambling. Addition of high - end dining venues, big production shows, and nightclubs in the late 1990's further accelerated the spending changes.

Total revenues for the 41 gaming locations on the Strip generated total revenues of $14.5 billion last year, which comprised 66 percent of total state revenue. Beverage revenues increased nearly 10% to $1.5 billion in 2011. The Strip casinos collected 9.3% more total revenues ending June 30, 2011 as compared to the previous year. Despite that increase, they still posted $2.2 billion in losses due to recessional effects of increased depreciation, higher interest payments, and additional debt and administrative expenses.

Highest debt ratios in Gambling Industry

TOP 5 COMPANIES IN THE CASINOS & GAMING INDUSTRY WITH THE HIGHEST DEBT TO EBITDA RATIO (MGM, BYD, PNK, ISLE, SGMS)

Below are the top five companies in the Casinos & Gaming industry as measured by their Debt to EBITDA ratio.

The measure of a debt's pay-back period is Debt/EBITDA. The longer the payback period, the greater the risk. This metric ignores all tax expenses even though a good portion are cash payments and gets paid first.

MGM Mirage (NYSE:MGM) has a Debt/EBITDA ratio of 12.81x based on total debt of $12.6 billion.

Boyd Gaming (NYSE:BYD) has a Debt/EBITDA ratio of 8.66x based on total debt of $3.2 billion.

Pinnacle Entertainment (NYSE:PNK) has a Debt/EBITDA ratio of 7.42x based on total debt of $1.2 billion.

Isle of Capri Casinos (NASDAQ:ISLE) has a Debt/EBITDA ratio of 7.34x based on total debt of $1.3 billion.

Scientific Games (NASDAQ:SGMS) has a Debt/EBITDA ratio of 7.28x based on total debt of $1.5 billion.

SmarTrend is monitoring the recent change of momentum in Pinnacle Entertainment. Please refer to our Company Overview for the results of our proprietary technical indicators that have been scanning shares of Pinnacle Entertainment in search of a potential trend change.

House of Financial Cards, Greedy Investors, Democracy Sold

Several articles similar to the one below have appeared and Sandy Adell said it best.

Marian Ilitch and New York’s Shinnecock Native Americans
Sandy Adell

In an earlier blog post I wrote about billionaire casino moguls, like Lyle Berman, whose enterprises broker the deals to gain Federal recognition for Native American Tribes and then work as middle-men between the tribes and the Federal government to hold land in trust in order to build “Native American” casinos. (See my post dated August 12, 2009)

Well now we can add a “middle-woman,” Marian Ilitch, to the list. According to an October 19, 2010, article on Crain’s Detroit Business website, Marian Ilitch has teamed up with the Southampton, New York based Shinnecock Native Americans in a new casino deal.

As I wrote in a comment on Crain’s website, it continues to boggle my mind that people like Marian Ilitch and other casino moguls, really wealthy people, are looking to expand gambling throughout this country under the guise of helping bring economic development to the less fortunate among us, this time to a community of 1200 Native Americans.

Gambling is not a philanthropic enterprise; The only real winners in the casino industry are billionaire owners, operators, and middle-men-and-women like Marian Ilitch and Company.



Ilitch teams with tribe on N.Y. casinos: Long Island plans could top $1 billion
By Bill Shea

Debt part of Ilitch equation

As the Ilitch family assesses how it will pay for the Detroit Pistons, Palace Sports & Entertainment Inc. and possibly a new downtown arena, debt remains on the family's past projects.

In January 2009, Marian Ilitch injected $45 million into her MotorCity Casino after lenders -- including Highland Capital Management LP -- threatened to hike interest rates to 18 percent on the $625 million loan her CCM Merger Inc. got in 2005 to finance purchase of the casino and for the later construction of its 300-room hotel.

The lenders reportedly wanted the additional investment because the casino was in jeopardy of violating its loan terms, a situation created when gambling revenue began to fall with the recession.

Deutsche Bank and Merrill Lynch arranged the loan in 2005.

The total financing for MotorCity is believed to be $950 million through a highly leveraged mix of fixed- and variable-rate bank debt and junk bonds, according to Forbes.

Ilitch paid $525 million to buy the majority ownership of the casino in April 2005 from Las Vegas-based MGM Grand/Mirage Casinos' Mandalay Resort Group, the MGM subsidiary that owned MotorCity.

She also paid Detroit entrepreneur Herb Strather $106 million for his Atwater Entertainment Associates LLC's 11.5 percent stake in MotorCity.

[If the name Herb Strather sounds familiar, it might be his connection to the Mashpee Wampanoag Tribe that he financed in order to gain recognition to build a casino.]

Another $85 million to $100 million went to former Ilitch partner Tom Celani for his 10 percent stake.

The Detroit Tigers, owned separately by Mike Ilitch, borrowed $140 million in August 2005 from a syndicate of 11 financial institutions, led by what is now Sumitomo Mitsui Bank, to refinance what had been $115 million remaining in debt from the original $145 million loan to build Comerica Park, industry magazine Sports Business Journal reported at the time.

The team has declined to comment on its current stadium debt.

Public debt on Comerica Park is through the Detroit-Wayne County Stadium Authority.

(This story has been updated to correct information about a lending company that was misidentified in the original version.)

The Ilitches' high-profile pursuit of the Detroit Pistons and plan to build a downtown arena could be dwarfed financially by the family's quiet effort that could top $1 billion to construct casinos for an American Indian tribe on New York's Long Island.

Marian Ilitch, sole owner of MotorCity Casino and matriarch of the family whose fortune is built from the Little Caesar Enterprises Inc. pizza chain she co-founded in 1959, has a casino development deal with the Southampton, N.Y.-based Shinnecock Indian Nation, which recently said it may build up to three casinos now that it has official federal recognition.

Even if the tribe builds just one hotel-casino, because it will serve New York it's expected to be significantly larger than MotorCity, for which Ilitch financed the purchase and expansion for $600 million. A trio of casinos could each still be as large as or even larger than the Detroit property.

MotorCity reported $446 million in 2009 revenue and had 2010 revenue of $333.5 million through September.

"The location will dictate the size of the casino, but it certainly will be larger than the operation at MotorCity," said Tom Shields, owner and president of Lansing-based Marketing Resource Group Inc. and spokesman for Ilitch and her partner in the casino effort, Birmingham developer Mike Malik.

The U.S. Bureau of Indian Affairs this month rejected final objections to its acknowledgment of the Shinnecock as a federally recognized American Indian tribe -- one seeking to build a casino, with Ilitch financial backing, to improve the lives of its roughly 1,200 members. They live on about 800 acres, mainly in mobile homes.

Such formal recognition, which the Shinnecock tribe first sought in 1978, is needed to open an Indian-run casino under federal law. It also makes the tribe eligible for federal housing, health and education funding.

Ilitch and Malik have been working with the tribe since 2003 on plans to build and operate a casino in Long Island's upscale Suffolk County -- an area better known as the Hamptons.

Casinos could be built elsewhere on the island to serve a wider population.

Ilitch and Malik are partners in Gateway Casino Resorts LLC and Gateway Funding Associates LLC, the businesses working with the tribe. They are headquartered in Detroit's Fox Theatre, whose offices are home to Ilitch Holdings Inc. and other Ilitch-owned ventures.

Additional state and federal legal, environmental and regulatory approvals are needed before a casino project can start -- something industry insiders have said is a long process with no guarantees and in which longer-recognized New York tribes have been mired for years.

The tribe prefers to negotiate with authorities to build a more lucrative Class III casino, which allows table games in addition to video slot machines under federal law. A Class III casino must share revenue with the state.

Ilitch and Malik will give the tribe financing and guidance on development and operations, Shields said. How much they'll be paid, and how much of a cut of the casino revenue they'll get, isn't yet known.

There is no timeline for the development, Shields added, noting that it's expected to take several years to get approvals and finish construction.

Beverly Jensen, communications officer for the tribe, declined to comment.

Casino spending

Malik and Ilitch have worked on casino efforts in Port Huron and Manistee and in Hawaii and California, but none have reached the stage of the New York project.

Expenditures on the Long Island effort have been significant.

Through Gateway, Ilitch and Malik paid Arlington, Va.-based lobbying firm Wheat Government Relations more than $1 million since 2003 to push for federal recognition for the Shinnecock, records show.

The casino project still needs the approval of New York's governor and Legislature.

Gateway hired Washington D.C.-based Mercury Public Affairs to lobby state government on behalf of the casino. The firm reportedly has met with New York Gov. David Paterson and state legislative leaders to discuss the gambling plan.

A comprehensive anonymous website, TheVerifiableTruth.com, for several years has tracked news and public records linked to Ilitch and Malik's casino ventures, and it shows that they have donated money to political candidates in positions to influence the tribal recognition or other casino-related issues.

The tribe's federal recognition suggests it was money well spent and eventually might result in new cash flow for the Ilitch empire.

In the meantime, the Ilitches will be conscious of the dangers of over-leveraging themselves, sports insiders say.

"All sports properties are acutely aware of not burdening themselves with debt," said Maury Brown, president of Portland, Ore.-based Business of Sports Network, which includes websites devoted to the business side of pro sports.

Ohio: There's always a Vegas connection

Charges against Frank Russo reveal details of Las Vegas trip from contractor

CLEVELAND, Ohio -- Former Cuyahoga County Auditor Frank Russo accepted a $6,000 gambling trip to Las Vegas from a contractor who sought millions of dollars in county business, prosecutors say.

"Don't say anything, but we just met with [contractor Ferris Kleem] who's going to be there. He's gonna have whores, and he's got a tiki hut by the pool. He's got everything," Russo told a friend in a conversation, according to court records.

"I heard," the friend said. "That's a beautiful thing. That's awesome."

The trip and Russo's words about it were included in 21 public corruption charges federal prosecutors filed Thursday in U.S. District Court. The charges detail how Russo used bribes, gifts and kickbacks to grease his 13-year career as auditor.

"We already knew that he was corrupt; the charges just fill in the blanks," said Catherine Turcer, who studies money in politics for Ohio Citizen Action, a public watchdog. "For years, it has seemed that corruption has been swept under a rug. Today, when we pick up the rug, you see that it is disgusting."

Kleem has admitted that he bribed Russo and county Commissioner Jimmy Dimora on the trip. An employee of a halfway house on East 55th Street also chipped in.

Brian Schuman, who worked for Alternatives Agency, helped pay for the airfare in an attempt to gain $250,000 for a work release program. Weeks after the trip, Alternatives Agency obtained its funding.

The trip to Las Vegas first surfaced when Schuman pleaded guilty last year to bribery charges. More details came out in May, when Kleem, a top executive of Blaze Construction Co. and its affiliates, pleaded guilty to bribery.

Prosecutors said Kleem hired a prostitute for Dimora, at a cost of $1,000, during the trip.

Dimora, who has not been named in the corruption investigation but matches the description of Public Official 1, has denied the allegations, and he has not been charged. His attorney, Richard Lillie, could not be reached for comment.

Thursday's charges spelled out Russo's role, the preparations for the trip and the lengths that Russo went to keep it secret.

Kleem first approached Russo in the fall of 2006, when the contractor asked the auditor for help in obtaining a grant from the U.S. Department of Housing and Urban Development for the city of Berea. The city wanted to build a pedestrian bridge connecting a nature trail to a pavilion on Coe Lake.

Prosecutors said Russo used his job as auditor to help expedite the city's application for the $150,000 grant. On Feb. 1, 2007, the county commissioners approved the grant.

A year later, Russo helped one of Kleem's businesses obtain a contract for $4.6 million for concrete work on the new juvenile justice center on East 93rd Street and Quincy Avenue. It received the contract.

Another of Kleem's companies tried for a $38 million contract to handle the general trades portion of the juvenile justice center.

"Ohhh, try everything to give it to him," Russo told Dimora on Feb. 26, 2008.

But Kleem's company wasn't the low bidder, prompting Dimora to say that there wasn't much he could do. He would have a tough time explaining to other county officials why they would have to toss out the lowest bid, according to the charges.

Before the trip, Kleem handed Russo an envelope with $6,000 in cash; $1,000 of it was for his airfare to Las Vegas and $5,000 for gambling at the Mirage Hotel and Casino.

After Russo returned from Las Vegas, a Plain Dealer reporter called him about it. Russo told the reporter it was just a bunch of guys who went to have fun.

But in a conversation April 10, 2008, with Dimora, who also went on the trip, Russo brought up the reporter's call. They "agreed it was nobody's business about their personal trip because the county didn't pay for their trip," according to the charges.

"I'm not going to tell [the reporter] that I saw Ferris Kleem over there [in Las Vegas]," Dimora said.

Russo interjected: "No. No. I would say I didn't see him. . . . Whatever you do, don't mention his name."