Adelson Being Investigated for Foreign Bribes


ProPublica, a non-profit news organization, has been doing some of the best investigative journalism in the country, winning Pulitzer prizes each of the last two years. This article is a great example of that excellent work, showing that Republican financier Sheldon Adelson may well be guilty of bribing foreign officials to get rich in Macau.

Now, some of the methods Adelson used in Macau to save his company and help build a personal fortune estimated at $25 billion have come under expanding scrutiny by federal and Nevada investigators, according to people familiar with both inquiries.

Internal email and company documents, disclosed here for the first time, show that Adelson instructed a top executive to pay about $700,000 in legal fees to Leonel Alves, a Macau legislator whose firm was serving as an outside counsel to Las Vegas Sands.

The company’s general counsel and an outside law firm warned that the arrangement could violate the Foreign Corrupt Practices Act. It is unknown whether Adelson was aware of these warnings. The Foreign Corrupt Practices Act bars American companies from paying foreign officials to “affect or influence any act or decision” for business gain.

Federal investigators are looking at whether the payments violate the statute because of Alves’ government and political roles in Macau, people familiar with the inquiry said. Investigators were also said to be separately examining whether the company made any other payments to officials. An email by Alves to a senior company official, disclosed by the Wall Street Journal, quotes him as saying “someone high ranking in Beijing” had offered to resolve two vexing issues — a lawsuit by a Taiwanese businessman and Las Vegas Sands’ request for permission to sell luxury apartments in Macau. Another email from Alves said the problems could be solved for a payment of $300 million. There is no evidence the offer was accepted. Both issues remain unresolved.

According to the documents, Alves met with local politicians and officials on behalf of Adelson’s company, Las Vegas Sands, to discuss several issues that complicated the company’s efforts to raise cash in 2008 and 2009.

The key fact here is that Adelson’s own general counsel and the CEO of his company both said, in writing, that the payments to Alves were a violation of the Foreign Corrupt Practices Act — but the payments were made anyway and both of those officials were removed from their positions.

The then-general counsel of Las Vegas Sands warned that large portions of the invoices submitted by Alves in 2009 were triple what had been initially agreed and far more than could be justified by the legal work performed.

“I understand that what they are seeking is approx $700k,” the general counsel wrote to the company’s Macau executives in an email in late 2009. “If correct, that will require a lot of explaining given what our other firms are charging and given the FCPA,” the Foreign Corrupt Practices Act.

Adelson, described by Forbes Magazine as the largest foreign investor in China, ultimately ordered executives to pay Alves the full amount he had requested, according to an email that quotes his instructions…

Several Las Vegas Sands executives resigned or were fired after expressing concerns about Alves’ billings. These include Las Vegas Sands’ general counsel and two top executives at Sands China, its Macau subsidiary.

Adelson could get nailed here, but it would likely do little damage. He still has his casinos in Macau and they’re bringing in money hand over fist, which he’s using to fund the Republican campaign to the tune of a hundred million dollars — and maybe more.

Comments

  1. Stevarious says

    I can’t imagine any conservative actually caring about this. It’s not like he was bribing real people Americans. Every conservative knows that it’s perfectly acceptable – no, encouraged – to mistreat foreigners in any way they can, as long as Step 3 = Profit!

  2. dingojack says

    I’m a foreigner, can you arrange for the Rmoney campaign to ‘mistreat’ me to the tune of $700,000 too?
    Greedily,
    Dingo

  3. Stevarious says

    Sure! I’m sure all it will take is a phone call to convince them to bribe a government official in your government (with $700,000) to look the other way while a Romney-owned business mistreats you.

    Or is that not what you meant?

  4. dingojack says

    So the people receiving the bribe are really secret Americans, because they received a bribe.
    Therefore offering bribe money to someone coveys that someone with US citizenship. Hmmm, sounds about right.
    Send the check to Lord Downer of Baghdad C/o [my address], no need to mark it ‘not negotiable’.
    :) DIngo

  5. cptdoom says

    Rachel Maddow did an amazing piece about this the other night – complete with comparisons of the population within 5 hours travel time from Macau vs. Vegas (hint, it’s about 6 times as large, and the people around Macau have almost no other option for gambling), which explains the cash cow on which Adelson is sitting. What is most remarkable about the $700,000 is that it was, IIRC, for 4 months work. One accounting form Maddow showed had a line item “expenses in Bejing” with $200,000 as the amount, with no other explanation. That pretty much fits the definition of something that would require a lot of explaining.

  6. Stevarious says

    @dingojack

    So the people receiving the bribe are really secret Americans, because they received a bribe.

    Well, when you replace ‘American’ with ‘Rich Man’ in all Republican rhetoric, it all makes sense. A bribed foreign official is temporarily ‘rich’ and therefore more ‘American’ than most Americans.

    @fastlane

    So, Romney’s even outsourcing his corruption?

    Oh, I really want to hear that line in an Obama campaign commercial.

  7. Michael Heath says

    cptdoom writes:

    One accounting form Maddow showed had a line item “expenses in Bejing” with $200,000 as the amount, with no other explanation. That pretty much fits the definition of something that would require a lot of explaining.

    For how long? I had a middle manager working for me in Hong Kong and that cost my dept. about $25K/mo., not including his compensation. I can easily envision executive expenses hitting $200K/week for a business trip there.

  8. says

    “For how long? I had a middle manager working for me in Hong Kong and that cost my dept. about $25K/mo., not including his compensation. I can easily envision executive expenses hitting $200K/week for a business trip there.”

    Was he working for a law firm named Alves? {;>)

    Seriously, I was recently visiting with my brother in Colorado and he was in China for several weeks a few months back. He said that his expenses, in the manufacturing enclave of Szuchou were about the same as they would have been in Longmont, maybe a bit less. He did say that taxis were unbelievably cheap. In the event, when an invoice item is $200K for expenses, with no detail, if it’s not part of a bribe it’s an incredibly stupid gaffe to have allowed it into the bill in that guise.

    I’m gonna lean towards fuckwaddery.

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