Global gaming conglomerate Las Vegas Sands Corp. was hit Thursday with a $9 million fine under US anti-foreign bribery laws for poorly documented payments the company made involving China investments.
The Securities and Exchange Commission (SEC) said the company, which owns leading casinos in Las Vegas, Macau and Singapore, had improper controls over and insufficient records of payments made to a frontman helping it buy a Chinese basketball team and invest in Beijing real estate in the 2000s.
That violated the US Foreign Corrupt Practices Act, the SEC said of a broad law aimed at preventing American companies from engaging in corruption abroad.
In chasing the deals -- neither of which ultimately went through -- the SEC added, Las Vegas Sands had little solid documentation for more than $62 million in payments to a "consultant," also called a "beard," helping arrange the China business.
"Despite concerns by some employees that the real estate purchase was solely for political purposes, approximately $43 million in payments were made to the consultant without research, analysis, or proper approval," the SEC said.
In addition, it noted large payments for "property management fees" when no property management services were performed, and $1.4 million for "arts and crafts" when no art was ever bought.
Although the consultant was not identified, widespread reports from 2009-2012, when allegations of bribery first came out, identified the company's key China agent as the well-connected businessman Yang Saixin.
The SEC, which began investigating the case in 2011, said the fine was for failing to implement adequate controls over payments.
The case cast a shadow over the Chinese business of Las Vegas gambling tycoon Sheldon Adelson, Las Vegas Sands Corp. chairman and chief executive, a powerful supporter of conservative causes in US politics.
The company stressed in a statement that it did not admit or deny the probe's findings, but agreed to the fine and to strengthen internal controls and record-keeping.
"The SEC made no finding of corrupt intent or bribery by Las Vegas Sands," it said.
"The projects were orchestrated through a consultant whose activities under a former company president and other former employees were not sufficiently monitored," it added.
The company also said the SEC probe arose from claims made in a lawsuit against it by Steven Jacobs, who headed its Macau operations before being fired in 2010.
The two sides are still fighting that legal battle in a Las Vegas court.