Pagcor: Wynn charges ‘uninformed, reckless’

MANILA, Philippines – The government’s chief casino regulator has issued a blanket denial of wrongdoing when he accepted freebies from a casino operator that he is overseeing.

In a statement released on Friday, February 24, Philippine Amusement and Gaming Corporation (Pagcor) chair and CEO Cristino Naguiat Jr  said the lawsuit filed by casino operator Wynn Resorts Ltd. against one of its former members of the board, Japanese businessman Kazuo Okada, “is a business dispute into which I have been dragged.”

“I have done nothing wrong and have not violated any laws,” Naguiat said.

Wynn’s suit cited alleged improper payments and gifts to Filipino regulators as Okada’s violations of the Foreign Corrupt Practices Act, a law that punishes illicit payments to government officials who decide over businesses of US companies overseas.

This was based on a year-long investigation by former Federal Bureau of Investigations (FBI) director Louis Freeh, who focused on the visits of the Philippine delegation to Wynn’s facilities in Las Vegas and Macau.

Of the over US$110,000 costs charged to the corporate account of Okada in Wynn over a 3-year period, the bulk, or over $50,000, was booked in September 2010, when Naguiat and his family and Pagcor colleagues visited Wynn Macau.

Over $100,000 charges
 
“I know nothing about the reported $110,000 in ’payments’ supposedly made to Philippine regulators since 2008 and certainly did not receive any such ’payments’,” Naguiat said.

He then refuted the details of the trip that were made public when Wynn filed the case against Okada in a Nevada court.  

“The facts are that I and a group of Pagcor officials, with approval of Pagcor’s board, visited Macau in September 2010 to meet with key gaming industry players and examine their operations.  The then Vice Chairman of Wynn Resorts, Mr. Okada, invited the group to meet with executives of Wynn Macau and stay at their resort in VIP quarters, compliments of Wynn Macau.”

According to the Freeh report, Naguiat stayed in a hotel suite reserved only for “high rollers” and costs $6,000 a night (est. over P250,000). He stayed in the suite for 4 nights and was later joined by his wife, kids and nanny.  

The Freeh report cited that Okada’s associates bought a Chanel bag for Naguiat’s wife based on the request of the regulator.

“The much commented upon Chanel bag was left in my room as a gift and on seeing it, I had it immediately returned,” Naguiat said.

On the reported $1,673 dinner tab charged to Okada’s room or his corporate account, Naguiat explained that the dinner “included not just the Pagcor delegation but a number of business associates of Mr. Okada who were meeting with Pagcor at the time.”

On the $20,000 cash advance and $5,000 credit allocation for the Filipino group charged against Wynn’s account, he said, “I only learned of the supposed $20,000 cash advance from Wynn Macau from media reports. Subsequent inquiries by PAGCOR revealed that the advance was drawn by Mr. Masato Araki, a business associate of Mr. Okada’s at the time. I found out about the reported $5,000 credit allocation from the Freeh report.”

“The PAGCOR delegation was never aware of any such allotment, nor was any offer or request made during the trip,” he said.

Thus, he said that these allegations against him are “outrageous, politically motivated and untrue.”

Ethics

Okada’s Universal Entertainment Inc. is one of the 4 casino operators that Pagcor had awarded a provisional franchise to build and operate casino-entertainment establishments at the grand Las Vegas-style complex that will soon rise in Bagong Nayong Pilipino – Pagcor Entertainment City in a reclaimed area in Manila Bay.

While Pagcor has a dual and conflicting role as a regulator and casino operator, it is the regulator of the Entertainment City project.  

Naguiat has earlier stressed that he accepted the invitation as part of “standard industry practice” among casino operators. He said they do the same thing–offer free transportation, hotel accommodation, other incidentals–when their foreign counterparts visit Manila.

The Palace, through Presidential Spokesperson Edwin Lacierda, had echoed this explanation, further stressing that the government actually saves on costs when Pagcor follows this ‘industry practice.’

“At the time of our visit, Mr. Okada’s Philippine gaming license had already been approved by the prior Pagcor management. Any insinuation that the complimentary accommodations extended to me and my family, who subsequently joined me for the weekend, were a bribe is untrue and just plain wrong.”

All government officials are required to observe the Revised Penal Code and the Code of Conduct for public employees. They prohibit them from accepting gifts from people or businesses regulated by government.

In a press briefing on Friday, February 24, Lacierda said President Aquino has decided to form a committee, likely to be headed by Executive Secretary Paquito “Jojo” Ochoa Jr,  to investigate Naguiat.

Naguiat and President Aquino are friends and former classmates at the Ateneo de Manila University. – Rappler.com