PH payments give US casino regulators new focus in Wynn-Okada feud

Posted at 11/16/12 5:50 PM

TOKYO - U.S. gaming regulators are investigating millions of dollars paid by affiliates of Japanese billionaire Kazuo Okada's Universal Entertainment Corp. to a former consultant for the Philippine gaming authority around the time the company was lobbying to win concessions for a $2 billion Manila casino.

A Universal subsidiary made a $5 million payment in May 2010 to Rodolfo Soriano, a close associate of the former head of the Philippine gaming regulator, according to a Reuters examination of bank records, corporate filings, court documents and records prepared by Universal staff. The payment was made via a shell company in Hong Kong and was part of $40 million in transfers made by Universal's U.S. affiliate Aruze USA that are now a focus for investigators.

The document trail connecting Soriano to the $5 million payment has not been previously reported.

It's not clear whether Okada, 70 and ranked 18th among Japan's wealthiest by Forbes, personally approved the payments. Universal, more than two-thirds controlled by Okada and his son through Okada Holdings LLC, has filed suit against three ex-employees saying they acted without proper authorization in channeling $15 million of the total through Hong Kong-registered Future Fortune Ltd.


The revelation of the contested payments is the latest twist in a bitter falling out between Okada, who made his fortune making and marketing pachinko machines - a mix of slot and pinball machines - and Las Vegas casino magnate Steve Wynn. Okada was Wynn's partner and largest investor until Wynn charged this year that Okada had broken compliance rules - and possibly U.S. law - by paying some $110,000 in entertainment and other expenses for gaming regulators from the Philippines and Korea.

The investigation of the much larger payments by Okada's company threatens to complicate Universal's attempt to get a U.S. federal court to reverse Wynn's decision to redeem Okada's Wynn Resorts shares at a discount. It could also complicate Universal's push to complete the casino on Manila Bay that it began building in January and has promoted as a VIP-destination resort for China's newly rich, some critics say.

"I don't have any illusions that it is going to be stopped, but there has to be accountability," said Teodoro Casino, a Philippine congressman who has urged the government to suspend the Universal project.

Universal referred questions to Yuki Arai, the lawyer who is representing the company in lawsuits against former employees. His office had no comment as of Friday.

Soriano could not be reached for comment. A woman at his home in Manila said he no longer lived at that address. She declined to say how he could be reached. An attempt to reach him at a Manila business operated by the family of his wife was also unsuccessful.