The U.S. Department of Justice and Las Vegas Sands Corp. have been engaged in settlement negotiations involving a DoJ probe into possible money laundering violations committed by the casino company.
DoJ attorneys let it be known in August that they were investigating the relationship between Mexican national Zhenli Ye Gon and the Sands after Ye Gon reportedly lost $125 million in Nevada casinos in recent years. The DoJ allege Ye Gon to be a supplier of methamphetamine and that he transferred some $85 million to the casinos from Mexican currency exchanges, according to the Wall Street Journal and later reported by CalvinAyre.com. Such huge transfers are normally red flagged by casino executives, but apparently failed to make any Sands’ lists of questionable financial transactions. The DoJ also saw fit to investigate $100 million in transferred funds to Las Vegas casinos from Ausaf Umar Siddiqui, the former VP of Fry’s Electronics who received a conviction in 2009 for taking kickbacks from suppliers of the electronics company.
The deal being brokered between the Sands and DoJ reportedly calls for the Sands to pay an undetermined fine and to be more wary of multi-million dollar transfers. The agreement would allow the casino company to avoid an indictment and a possible conviction that could cost more than $100 million in forfeitures and fines. The settlement discussions are still ongoing. If a deal should not be reached, the Sands would be the first casino company to face criminal rather than civil charges since a 2003 mandate requiring the filing of transactions of a suspicious nature.
The Sands is also under investigation for possible violations of the Foreign Corrupt Practices Act in deals made with Asian public officials. That probe is unrelated to the money laundering allegations that Sands’ executives tried unsuccessfully to get the DoJ to drop last week.
Click here to read Godwin Maidment’s recent blog on HSBC, money laundering and greed.