Gov't may cancel Okada's casino license if bribery proven

Posted at 11/19/12 5:54 PM

MANILA, Philippines - The Philippine government on Monday said it may cancel the provisional license to operate a casino given to Japanese billionaire Kazuo Okada's group, if allegations of bribes given to a former Philippine Amusement and Gaming Corp. (Pagcor) consultant are proven. 

This comes after US gaming regulators have said they are investigating the alleged $5 million bribe given by Okada's company to former Pagcor consultant Rodolfo Santiago, during the time it was lobbying to win concessions for a $2 billion casino.

Presidential spokesperson Edwin Lacierda said the government will not think twice in revoking Okada’s casino license if this was obtained via bribery.

"If there's a proof that the license was obtained through bribery, then there may be reasons to consider cancelling the contract... It is something that we will not countenance. However, we must remember that there should be due process there," Lacierda said in a press conference.

Lacierda said the Department of Justice has already been asked to investigate whether bribes were paid in relation to the project being developed by Okada's Universal Entertainment 

In a statement, Pagcor said it was asking the DOJ and National Bureau of Investigation to coordinate with the Federal Bureau of Investigation in the United States on the probe. 

"The group of Mr. Okada is a major investor in the Philippines and this is the reason why PAGCOR is giving them a chance to address all the issues... If the group of Mr. Okada will be proven beyond reasonable doubt that they have violated Philippine laws and they fail to comply with the provisions of the provisional license issued to them, they cannot commence their casino operations," Pagcor said. 

Earlier on Monday, Pagcor chief legal counsel Jay Santiago said the agency will cooperate with the US Federal Bureau of Investigation (FBI) probe into the bribery allegations.

"Kami din ay nasopresa na grabe pala talaga ang nangayari... Ang gagawin natin ay magpapatulong tayo sa DOJ at NBI para makipag-coordinate sa Federal Bureau of Investigation, para malaman ang report, kung kailangan ng aksyon," he said, on dzMM's Failon Ngayon. 

Okada's Tiger Resort Leisure and Entertainment Inc. is one of the 4 groups given a license to operate a casino in Pagcor's Entertainment City. Okada is planning to build a $2-billion world-class resort-casino complex in Entertainment City. 

Last Friday, Reuters reported that an Okada-led Universal subsidiary made a $5 million payment in May 2010 to Soriano, a close associate of the former head of the Philippine gaming regulator, according to documents. 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.

However, the report was not clear whether Okada, ranked 18th among Japan's wealthiest by Forbes, personally approved the payments. 

'Strengthens case vs Genuino"

Meanwhile, the Pagcor believes the new allegations of bribery  will help strengthen its plunder case against Soriano and former Pagcor chairman Efraim Genuino, which was filed in 2011.

The case stems from the misappropriation of at least P186 million in questionable deals with Batang Iwas Droga Foundation, Inc. (BIDA) and other BIDA entities from 2003 to 2010. These deals, which were entered into during Genuino's term, did not go through public bidding.

Pagcor noted Universal Entertainment also has to resolve the issue over land ownership in their proposed site at Entertainment City, since it violates constitutional restrictions on foreign ownership.

"Pagcor already advised the group of Mr. Okada that until such time that they have resolved the land ownership issue, they cannot open their casino operations," the agency said. - 

Congress to probe bribery allegations 

Separately, a Philippine congressman who has urged the government to suspend the Universal casino project called for a legislative hearing on the matter. Rep. Teddy Casino had previously submitted a resolution calling for an investigation. 

"We will have to include new pieces of evidence unearthed by Reuters news agency that can help complete the picture of corruption in PAGCOR," Casino said in a statement. 

Sen. Miriam Santiago also called for a Senate investigation of the reported payment to Soriano, citing the Reuters report. 

Okada has been seeking to have a U.S. court reverse an earlier move by Wynn to redeem his shares in Wynn Resorts Ltd at a 30 percent discount after the board determined he was an "unsuitable" shareholder. 

That finding was based in part on Universal's record of paying for entertainment and lodging expenses for PAGCOR officials, including Soriano and Genuino, Wynn said at the time. 

Both Soriano and Genuino are the targets of a corruption case brought by the Aquino administration in 2011. PAGCOR said on Monday that the report of payments to Soriano would "strengthen its plunder case" against the two men. 

Soriano and Genuino could not be reached for comment. 

On Friday, one of the U.S. law firms representing Okada withdrew from the lawsuit against Wynn.

Paul Spagnoletti, an attorney with the New York offices of Davis, Polk, Wardwell LLP, said his firm had stopped representing the Japanese businessman. Spagnoletti would not cite a reason for the sudden withdrawal. - With reports from Reuters and Willard Cheng, ABS-CBN News