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 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.