GOP-donation machine Sheldon Adelson's casino company is being investigated over its role in two high-profile money laundering cases, according to the Wall Street Journal. Investigators aren't looking at Adelson for any wrong doing, but his company, Las Vegas Sands, is being looked at over suspicious transfers made by two "whales" that could be considered money laundering.
Zhenli Ye Gon is Chinese-born Mexican businessman who owned a pharmaceutical company. Ye Gon was arrested in 2007 on suspicion of moving chemicals across the border with the intent of turning them into meth. Ye Gon was a regular customer at the Venetian, the Sands' prize casino in Vegas, and he bragged about playing $150,000 hands of baccarat there. He also alleged the casino gave him a Rolls Royce. Investigators think Ye Gon's use of Mexican currency-exchange firms to transfer $85 million into the U.S. should have been a red flag for the casino, and they should have alerted authorities. At the time, no one knew of Ye Gon's drug charges. The company alleges they thought he was legitimate. He's no stranger to money laundering scandals, though. Ye Gon's name also came up in a money laundering investigation involving HSBC.
Ausaf Umar Siddiqui is the other businessman suspected of using the Sands casinos to launder money. His money laundering strategy was a bit more complex:
Sands received more than $100 million from Mr. Siddiqui through a circuitous route, according to court filings in a later criminal case against him for taking kickbacks from Fry's vendors. Filings in that case indicate that Mr. Siddiqui created a company called PC International LLC to receive kickbacks, then wired more than $100 million to two Sands companies, Venetian Marketing Inc. and WDR LLC, over a three-year period ending in 2008. That company also wired about $20 million to Destron, an MGM Resorts subsidiary, according to the filings.
Siddiqui was a vice-president at Fry's electronics with a documented salary of $200,000. He had a good relationship with the Venetian too, receiving "huge lines of credit, free luxury hotel suites and free private-jet rides," according to the Journal's report.
What the Department of Justice has to prove is that the casino company willfully ignored any warning signs that the money the two men transfered was in any way illegal. Casinos are treated the same as banks: they can be charged for ignoring warning signs the money they're dealing with was obtained illegally.
Sheldon Adelson has been extremely active in this year's campaign, pledging to donate over $100 million to the cause. The Journal's report says the investigation might lead to the Department of Justice being criticized for trying to discredit a major Republican supporter, but the Sands are already being investigated for violations of the Foreign Corrupt Practices Act. Just add this one to the list.