Business

US-owned casinos in China with mob ties?

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Michael Bastasch Energy Editor

Loosely based on a WikiLeaks model, the website Casinoleaks-macau.com has been working to bring closer scrutiny to casinos on the Chinese island of Macau over possible connections between their U.S. owners and China’s criminal underworld, according to ABC News. The website says it uses publicly available financial documents to expose connections between U.S. companies and criminals. One of the firms they scrutinized is Las Vegas Sands Corporation, run by the billionaire backer of Republican presidential candidate Newt Gingrich, Sheldon Adelson.

Adelson and his relatives have donated over $10 million to the Gingrich campaign, and he has indicated that he may give up to $100 million to influence the election. Adelson has also been under investigation for over a year by the Department of Justice and the Securities Exchange Commission for alleged bribery of foreign officials, according to corporate documents obtained by ABC.

Also, in a separate civil lawsuit, a former company executive alleged that Adelson ordered him to keep quiet about sensitive issues at company casinos on Macau, including the alleged “involvement with Chinese organized crime groups, known as Triads, connected to the junket business” at those casinos. The Triads are a Chinese crime syndicate allegedly involved in high stakes gambling junkets for wealthy Chinese travelers.

A 2011 report by the U.S. Congressional-Executive Commission on China described the areas where Las Vegas Sand casinos operate as areas where corruption is “a major and growing problem.”

The commission found:

“The growth of gambling in Macau, fueled by money from mainland Chinese gamblers and the growth of U.S.-owned casinos, has been accompanied by widespread corruption, organized crime and money laundering.”

Adelson, denies these allegation, saying at a gaming forum last year that the lawsuit “is not a serious case” and that the federal case is built on a “foundation of lies.”

“When the smoke clears, I am 1,000 percent positive that there won’t be any fire below it,” Adelson said.

Casinoleaks.com goes into heavy detail about the corporate and private ownership of government licenses to operate VIP gambling rooms on Macau. The website further details how the concessions allow the license holders to operate junkets for mainland Chinese gamblers to special high-roller rooms inside casinos, including those owned by American firms MGM Grand, Wynn Resorts and Las Vegas Sands.

Junkets are responsible for organizing tours for Chinese gamblers, overseeing the gambling rooms and collecting debts from the owed by the gamblers.

Jeffrey Fiedler, who helped launch Casinoleaks.com with the backing of the International Union of Operating Engineers (IUOE), sent a letter to the Nevada Gaming Commission and the Nevada Gaming Control Board relaying his concerns about the casinos’ involvement with criminal syndicates.

“We believe that the issues we raise are urgent public policy concerns that cannot be ignored given the huge sums of money involved and the danger that criminal involvement in gaming poses for the people of the United States,” Fielder wrote.

In the letter, Fiedler also specifically references the Neptune Group, which Fiedler alleges has “deep and continuing relationship” with a notorious Chinese gang leader.

“We urge you to undertake a thorough investigation into the operation of the Neptune Group and its affiliated organizations to determine their suitability to do business with licensed casino operators in Nevada who also do significant business in Macau,” he wrote.

The Hong Kong-based Neptune Group’s spokesman hasn’t responded to an email seeking a comment.

The Triads pose a significant problem for China and the gambling industry there. “The triads are making a ton of money off the gambling industry,” said Ko-lin Chin, a Rutgers University criminal justice professor and a leading expert on Chinese organized crime. “They are still there, they are still very active.”

Casinos and their possible criminal connections, however, won’t go unwatched. The International Union of Operating Engineers is the tenth largest union in the AFL-CIO and has emerged as a watchdog for casino companies, including some that employ the union’s members.

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