It’s turning out to be a very busy summer for theLas Vegas Sands legal team.
Sands, led by billionaireSheldon Adelson, has already been defending itself against a wrongful termination suit by a former executive and is also entangled in a Chinese bribery scandal. Now the Wall Street Journal reports that the gaming giant is embroiled in a money laundering probe.
The WSJ wrote that the U.S. Attorney’s office in Las Vegas is looking into whether Sands and its executives violated U.S. anti-money laundering laws by failing to report suspicious activity by two big-spending gamblers.
The investigation involves Zhenli Ye Gon (who has been indicted on counts of trafficking methamphetamine ingredients) and Ausaf Umar Siddiqui, (a former executive of Fry’s Electronics who went to jail on bribe charges) who wired tens of millions of dollars to the Sands Venetian casino in Las Vegas during the mid-2000s.
According to the WSJ, the government is investigating whether the Sands ignored the wire transfers or failed to have the right systems in place to flag sketchy activity. Sands chief Sheldon Adelson is not under investigation. Sands spokesman Ron Reese did not comment on the current allegations but did tell the Journal: “The company believes it has acted properly and has not committed any wrongdoing.”
The case is one more legal headache for Sands CEO Adelson, a major Republican donor who has given more than $10 million to the Super PAC of Republican presidential candidate Mitt Romney andpledged to give a “limitless” amount of money to defeat Barack Obama.
Adelson has been locked in a court battle with his former CEO of Sands China, Steve Jacobs. As I wrote earlier, Jacobs is suing Sands for breach of contract and alleging he was let go after refusing orders from Adelson to break the law. He has since accused the Sands of promoting prostitution, working with mafia figures, bullying banks and potentially violating the Foreign Corrupt Practices Act by putting a government official on its payroll. Jacobs is reportedly seeking roughly $100 million in damages. The suit also kicked off a Federal investigation into whether the Sands broke the Foreign Corrupt Practices Act by bribing Chinese officials in Macao where Sands runs a lucrative gaming empire. Sands and Adelson have denied all charges.
After remaining silent about the suit Adelson spoke to Forbes about the allegations saying: “[Jacobs] is abusing the court and the court system to protect himself while he sues us for a hundred or two hundred million dollars that he obviously doesn’t deserve.”
These days what’s bad for Adelson is also bad for Romney. News of the bribery and prostitution investigations had many political groups, most famously the National Jewish Democratic Council, calling on Romney to give back any donations from Adelson. Although Adelson has not been named in this latest laundering charge, it strikes another blow to Adelson and the Republicans. Romney supporters will likely question whether the timing of the U.S. Attorney’s investigation is a just political move set to damage the image of the Republican’s “limitless” money man.