Sheldon Adelson’s Sands Casino to pay $47 million fine for failing to report deposits from alleged drug trafficker

2013-08-28

The Sands failed to report that Chinese-Mexican businessman Zhenli Ye Gon, who is under investigation for drug trafficking, deposited more than $45 million into the Venetian casino in 2006 and 2007.

■Las Vegas Sands Corp, which is owned by U.S. billionaire Sheldon Adelson, signed a settlement with the U.S. Justice Department on Monday, agreeing to pay $47.4 million in fines stemming from a money laundering investigation.

For business tycoon Sheldon Adelson it is the equivalent of salt in the wound.

After spending millions to try and thwart President Barack Obama’s reelection in 2012, Adelson’s Las Vegas casino empire agreed this week to pay the U.S. government $47.4 million in fines to avoid criminal charges stemming from a money laundering investigation.

Las Vegas Sands Corp., which owns the Venetian Resort Hotel and Casino, agreed to the settlement with the U.S. Department of Justice on Monday night.

For two years, the Justice Department gathered evidence showing that Chinese-Mexican businessman Zhenli Ye Gon had deposited $45 million in suspected drug money to the Venetian in 2006 and 2007 in a series of complex transactions designed to avoid detection.

Federal law requires that suspicious deposits be reported to U.S. authorities, but Ye Gon was the casino’s best customer, losing more than $90 million at the Venetian’s tables.

■Chinese-born businessman Zhenli Ye Gon, who lost more than $90 million at Adelson's Venetian casino, deposited $45 million directly to the casino in 2006 and 2007 in transactions designed to avoid detection.

“For the first time, a casino has faced the very real possibility of a federal criminal case for failing to properly report suspicious funds received from a gambler,” U.S. Attorney André Birotte Jr., who represents the Central District of California, said in a statement.

“This is also the first time a casino has agreed to return those funds to the government,” Birotte said. “All companies, especially casinos, are now on notice that America’s anti-money laundering laws apply to all people and every corporation, even if that company risks losing its most profitable customer.”

In his statement, Birotte said that the Sands admitted “in hindsight that it failed to fully appreciate the suspicious nature of the information or lack thereof pertaining to Ye Gon.”

While the fine is significant, many investors had anticipated that the Sands would have to settle for an even larger amount. Adelson, who is the CEO and chairman of Las Vegas Sands Corp., has a net worth of more than $20 billion.

The Sands is not out of the woods yet, however. The Justice Department and Securities and Exchange Commission are still conducting a separate investigation into whether the casino empire—which owns resorts in resorts in Macau, Singapore and Pennsylvania—may have violated the Foreign Corrupt Practices Act, the Las Vegas Review Journal reported.

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