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Sheldon Adelson’s casino company pays $7M penalty

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Latest MoneyWatch headlines 01:10

LAS VEGAS - Billionaire Sheldon Adelson’s casino company is paying almost $7 million to U.S. authorities to end a more than five-year corrupt practices investigation of the firm’s former relationship with a consultant in Macao and China, company and federal officials said Thursday.

With the agreement, Las Vegas Sands (LVS) resolved twin probes of more than $60 million paid to an unnamed agent retained in 2006 to acquire a Chinese basketball team, plus other business dealings that include a Beijing real estate deal to promote casinos on the Cotai Strip of Macao, U.S. Justice Department and FBI officials said.

The $6.96 million penalty was in addition to a $9 million civil payment the company made in April to settle a U.S. Securities and Exchange Commission investigation that found some payments to the consultant weren’t properly authorized or documented, the government said.

Las Vegas Sands wasn’t charged with a crime and did not admit guilt in either case.

Sands spokesman Ron Reese characterized the payment announced Thursday as a monetary penalty and said the nonprosecution agreement made no criminal finding.

“The company is pleased that its cooperation and long-term commitment to compliance were recognized in reaching this resolution,” he said, and that “all inquiries related to these issues have now been completely resolved.”

The government said none of the people whose conduct was described in the agreement work for Sands any longer. It also credited the company with undertaking extensive remedial measures.

But it offered a scathing summary of alleged wrongdoing in a statement about Thursday’s settlement.

“Certain Sands executives knowingly and willfully failed to ... adequately ensure the legitimacy of payments” to the consultant, the government said, and “continued to make payments to the consultant despite warnings from its finance staff and an outside auditor that the business consultant had failed to account for portions of these funds.”

In fact, the Sands finance department employee who raised concerns about the payments was fired, the government said.

The SEC and Justice Department probes were announced at the same time, in 2011, and stemmed from the same alleged acts during Sands’ efforts to become a major player in Macau, a former Portuguese colony that has become a gold mine for U.S. casinos.

Adelson last September opened a fifth company property, the $2.9 billion Parisian Macao, on the Cotai Strip. The company’s Sands Macau opened in May 2004.

In the U.S., Sands owns the Venetian and Palazzo resorts on the Las Vegas Strip, and Adelson is a major donor to Republican party candidates. His family also owns the largest newspaper in Nevada, the Las Vegas Review-Journal, and is involved in efforts to build a $1.9 billion domed stadium to attract the NFL’s Oakland Raiders to move to Las Vegas.

Reese dismissed any link between the unsuccessful effort to acquire a pro sports franchise in China and Adelson’s pledge that Sands Las Vegas would pay $650 million toward the Las Vegas stadium.

“One has absolutely no bearing on the other,” the company official said.

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