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Chris Sieroty
 

Wynn Resorts: SEC concludes inquiry, not planning to recommend enforcement action

9 July 2013

By Chris Sieroty

LAS VEGAS -- Wynn Resorts, Limited said Monday that the U.S. Securities and Exchange Commission has concluded its inquiry into allegations that the Las Vegas-based gaming company made an improper donation to the University of Macau Development Foundation.

In an 8-K filing with the SEC, Wynn Resorts informed shareholders that the investigation, which began Feb. 8, 2012, had concluded.

“On July 2, the company received a letter from the (commission) stating that the investigation had been completed with the (SEC) not intending to recommend any enforcement action against the company by the SEC,” Wynn Resorts said in its filing.

Speaking to The Associated Press from his boat on the Spanish island of Ibiza on Monday morning, CEO Steve Wynn said he never had any doubt federal investigators would clear the company.

“We were so sanguine that we never paid any attention to it; we had no exposure. It was a nonevent except for the damn newspapers,” he said.

The accusations of an improper $135 million donation to the University of Macau in 2011 stem from a business dispute between former friends and business partners Wynn and Kazuo Okada.

Okada, CEO of Tokyo-based Universal Entertainment Corp. and its subsidiary Aruze USA, used to be Wynn Resorts’ largest shareholder, but the company forcibly bought back his 24.5 million shares for a $1.9 billion note maturing in 2022. Okada and Universal Entertainment officials were unavailable for comment Monday.

Okada suggested that the donation may have violated the Foreign Corrupt Practices Act, a federal law that bans U.S. companies or executives associated with them from paying off officials to win business overseas.

Okada suggested that the donation coincided with the company’s request to develop a third property on the Cotai Strip.

The Macau government approved Wynn Resorts’ $3 billion, 51-acre Cotai resort-casino project in May 2012.

Wynn repeatedly denied the allegations and said Okada himself had approved the donation as a director on the company’s board.

Okada is now under investigation by the U.S. Department of Justice for possible FCPA violations in the Philippines associated with Universal Entertainment’s construction of a multibillion-dollar resort-casino in Manila Bay.

In February, the Nevada Gaming Control Board concluded its own investigation into the donation and found no evidence of wrongdoing.

Shares of Wynn Resorts were down 10 cents, or 0.08 percent, to close at $126.98 on heavy trading of 1.43 million shares on the Nasdaq.