Probe Pagcor 'bribes,' Miriam urges Senate
MANILA, Philippines - Sen Miriam Defensor Santiago has pushed for a probe on the reported bribery by the a casino operator vying for incentives from regulatory officials of the Philippine Amusement and Gaming Corporation (Pagcor).
On Monday, November 19, Santiago filed a Senate resolution to investigate allegations that former Pagcor consultant Rodolfo "Boysee" Soriano received about $5 million from Universal Entertainment Corp., a firm led by Japanese billionaire Kazuo Okada.
Universal is one of the 4 groups awarded the right to develop and operate casino and entertainment operations at the up-and-coming Manila Bay complex. The US gambling operator is also investigating transactions between Universal's Nevada-based unit, which is covered by the US Anti-Foreign Corrupt Practices Act, and Soriano.
Santiago said the Senate investigation will determine if the Pagcor officials violated the Anti-Graft and Corrupt Practices Act.
She explained that this probe was triggered by news reports that Soriano was allegedly former Pagcor chair Ephraim Genuino's "bagman" who received millions of dollars from Universal Entertainment at the time the Okada-led firm was lobbying the government for tax breaks and ownership-related concessions for its planned casino on Manila Bay. These alleged money transfers happened in the final months of the Arroyo administration in 2010.
The lady senator said she was "aghast" that a mere consultant such as Soriano represented Pagcor in the negotiations with Universal for its $2-billion casino-entertainment project. Consultants in government-owned and –controlled corporations should not transact on behalf of their agency or the Philippine government, Santiago said.
Business and politics
In her resolution, Santiago described Soriano as one who "operated at the nexus of business and politics in Manila and often networked over rounds of golf at the Wack Wack Country Club, one of the country’s oldest golf courses."
Citing Manila-based lawyer Manuel Camacho who used to represent Universal in the Philippines, Santiago said "it was understood that Soriano was an agent for Okada on the Manila casino project even as he worked for Pagcor as a consultant. Camacho even claimed that Soriano is Okada himself."
Santiago wrote that Camacho, who also spoke to investigators, "claimed that money he was paid by Universal was diverted by his former law partner, Genuino’s son, Erwin, and sent as a payoff to local officials to win clearance for road building."
Santiago cited the Reuters report that followed the money trail for a portion of the alleged $40 million total payments made by various Universal corporate units to Soriano-led companies during the remaining months of the Arroyo administration in 2010.
The Reuters report zeroed in on the $5-million payment to Soriano in May 2010, two months before the Arroyo-appointed Pagcor officials would step down from their posts.
Santiago's resolution said Univeral's US affiliate transferred the funds to the HSBC account of Future Fortune, a shell company in Hong Kong run by Universal employees. From Fortune, the funds were transferred to Soriano's firm, People’s Technology Holding Ltd, which was only established the previous year.
The senator noted that Reuters described these series of payments to Future Fortune as both “consulting fees” and, in one case, an “increase in capital,” while the $5-million payment to Soriano’s People’s Technology was described as an “advance payment.”
The remaining $35 million balance was reportedly paid from January to May 2010 and coursed through a firm called Subic Leisure and Management, Santiago said, citing records.
The lady senator described Subic Leisure as a British Virgin Islands company registered only in September 2008, "weeks after Universal acquired reclaimed land on Manila Bay and announced plans to build Asia’s largest aquarium, a Ferris wheel and a 2,050-room hotel and casino."
These different tranches of $40 million payments were reportedly on top of the $300 million payment Universal has previously made to acquire the land values at the Manila Bay project. This payment followed Pagcor's official grant of a provisional license so Universal could operate a casino business there.
"Universal continued to lobby for its casino to be exempt from corporate tax and for an exception to rules requiring that Philippine investors own 60% of the venture, according to 3 former employees involved in the project," Santiago wrote in the resolution.
Pricey hotels, dinners
Santiago also included Soriano's and Genuino's visits to various hotels and casinos where Okada has stakes in. Soriano and his wife reportedly stayed free at various Wynn resorts 5 times between 2008 and 2010, the senator said.
Santiago highlighted that, "on a June 2010 trip, Soriano traveled with Efraim Genuino to Wynn Macau where Universal covered their expenses of $2,974.70, including $25 for Soriano to watch a movie."
Wynn Resorts have branches in Nevada and Macau. Okada, who used to have stakes in Wynn Resorts, is now entangled in legal disputes with his friend-turned rival Steve Wynn. Okada has since been ousted from the Wynn Resorts board.
Santiago also cited the investigation report of former Federal Bureau of Investigation (FBI) director Louis Freeh, a product of months-long investigation commissioned by Wynn Resorts, that disclosed that "both Soriano and Genuino were guests at Wynn resorts with their expenses paid for by Universal when Okada was a major Wynn shareholder and Genuino was Pagcor chairman.
The Freeh report also said that Okada made 3 dozen improper payments and gifts over 3 years worth over $110,000 to regulators outside the US.
The Freeh report also revealed that people associated with former Pagcor chair Genuino have served in positions in companies controlled by Okada, providing corporate links between Okada's business interests and those of Genuino's."