SUIT TAGS PAGCOR CHIEF WRONGDOING
MANILA, FEBRUARY 25, 2012 (TRIBUNE) Malacaang considers the
Philippine Amusement and Gaming Corp. (Pagcor) as just a collateral damage in an
internal corporate conflict between two giant casino magnates as a top Palace
official yesterday turned the tables on former First Gentleman Jose Miguel
Mike Arroyo whom he said should explain as to why a private person like him
met with casino magnates Steve Wynn of Las Vegas and Kasuo Okada in Macau.
Presidential spokesman Edwin Lacierda, in a press briefing, said Pagcor
Chairman Cristino Naguiat should not be persecuted for being dragged into the
internal corporate conflict between Wynn and Okada, who have been fighting over
the control of the company that owns and operates the Wynn Resorts and Casinos
worldwide.
This is a controversy; this is a huge intra-corporate controversy between Mr.
Steve Wynn and Mr. Okada... So obviously this is a fight between two gaming
titans. The Philippines has become and Pagcor has become a collateral damage
there, he added.
Maintaining that Naguiat did nothing illegal, Lacierda said it is the
former First Gentleman who should be investigated, adding Arroyo has no business
dealing and representing Pagcor with the executives of Wynn Resorts and Casino
since hes neither a Pagcor executive nor a government official.
I think the former First Gentleman should answer that. He is not a member or
an official of the Pagcor, the Palace official added.
It is up to (former Pagcor head) Mr. (Ephraim) Genuino and the First
Gentleman to answer that. (But) as far as we are concerned, as far as Mr.
Naguiat is concerned, he has not profited personally from this alleged
accusation.
As to how Pagcor was dragged into it, Lacierda explained that the
investigation conducted by former director of the Federal Bureau of
Investigation (FBI) Louis Freeh showed some alleged anomalies, which saw Naguiat
attending a casino convention in Macau.
But he (private investigator hired by Mr. Wynn) failed to mention that Mr.
Bong Naguiat was there not as a casino regulator but as a casino operator. And
when he went to Macau, there was a gaming convention of casino operators and, if
you know how it goes, casino operators are provided accommodations elsewhere. If
they come here as casino operators, the casino operator is also given the same
accommodation. There is no ethical violation because he was there as a casino
operator, not as a casino regulator, Lacierda added.
Again, he couldnt go there as a casino regulator because the provisional
agreement has already been signed in 2008 and he was there talking to several
casino operators. Let us remember that Pagcor operates several casinos Casino
Filipino and all the Pagcor casinos so he was there as a casino operator. So the
impression being laid down just because he was given accommodations is on the
basis that he violated federal laws. But we have not seen any suit against Mr.
Naguiat. Even in the States, its a suit against Mr. Wynn against Mr. Okada and,
again, we are collateral damage here, he added.
When asked to expound on the alleged bribe, Lacierda said: Now, as to the
amount that is being said, again Chairman Naguiat has no knowledge of what the
value of that the room that he stayed in. So, again, he was also surprised at
the amount of the alleged room per day.
He, however, admitted that Naguiat indeed took his family along even as he
claimed that the Pagcor chief paid for the travel fare of his family.
Lacierda went on the defend Naguiat whom he claimed that the travel abroad in
which Naguiats name has been dragged was an official function.
Well, right now, he is there as a casino operator and, in the gaming
industry, you provide accommodations to fellow casino operators and it was a
gaming convention that he attended. It was business for Pagcor. It is a business
a function of Pagcor, not a personal trip by the chairman. It was
work-related. Fernan J. Angeles
Pagcor chief: I'm collateral damage in tycoon war
By Helen Flores (The Philippine Star) Updated February 24, 2012 12:00 AMComments
(17)
[PHOTO - Pagcor Chairman Cristino Naguia and former Pagcor chairman
Efraim Genuino. INQUIRER FILE PHOTO]
MANILA, Philippines - Philippine Amusement and Gaming Corp. (Pagcor) chairman
and chief executive officer Cristino Naguiat Jr. yesterday said he has become
"collateral damage" in the widening legal battle between two casino giants.
Naguiat also expressed concern on the possible effects of the bribery issue
on the agency's $5-billion Entertainment City project in Manila Bay.
Wynn Resorts Ltd. chief executive Steve Wynn on Monday filed a lawsuit
against his partner, Japanese gambling tycoon Kazuo Okada, for violating the US
Foreign Corrupt Practices Act.
Okada, who has a $2-billion investment in Entertainment City in Manila Bay,
allegedly spent more than $110,000 to curry favor with Pagcor officials.
"Basically it is a battle between two tycoons and I'm the collateral damage
here," Naguiat told select members of the press. "It's a corporate battle,
naiipit kami dito (We are caught in the middle)."
Naguiat did not deny receiving freebies from Wynn Resorts during his five-day
visit to Macau in September 2010 but stressed that this was limited to
complimentary hotel accommodations from a casino investor.
He also stressed that giving hotel accommodations is an acceptable industry
practice.
Naguiat also denied that his wife received a Chanel bag from Wynn Resorts
Ltd.
"It (bag) was returned, but it was not mentioned in the news report," Naguiat
clarified.
'Industry practice'
Malacañang also defended Naguiat on the accusations that he received perks
and privileges from a Japanese gambling tycoon.
"Insofar as chairman Naguiat is concerned, there was no cash gift granted to
(him)," presidential spokesman Edwin Lacierda said.
Lacierda said only hotel accommodations were granted to the Pagcor chief,
which he said was 'industry practice.'
"Again, it's an industry practice as long as you don't profit from it
personally... it's a practice that you provide accommodations for each other,"
he added.
He said such practices are allowed and pose no problem with President Aquino
since it would save the government the costs of attending international
conventions in New York, Japan or London that are usually expensive.
"It would be more expensive for us to pay for all the expenses and since it's
already an industry practice and Mr. Naguiat never profited from it personally,
this is something that is peculiar to the gaming industry," Lacierda explained.
"We (who are) outside of the gaming industry would view this as sort of
unique but, again, this is something that's common in the gaming industry," he
stressed.
Malacañang also defended Naguiat on reports that his wife, three children and
a nanny were accommodated in a five-star hotel in Macau when he attended a
convention sponsored by a Japanese casino operator.
"It's a weekend. His family came on Friday and chairman Naguiat wants to see
his children too," argued Lacierda, adding that the transportation expense of
his wife and family "was paid for by Mr. Naguiat."
He also said the family's "accommodation was in the same room" – reportedly a
suite – that Wynn had provided to Naguiat, being a VIP guest.
"It was a gaming convention that he attended. It was business for Pagcor. It
is business, a function of Pagcor, not a personal trip by the chairman. It was
work-related," Lacierda asserted.
Destroying the credibility
Naguiat said Wynn apparently was not in favor of Okada's project in the
Philippines.
"They want to hit the credibility of the Pagcor project of Okada here," he
said.
Naguiat said Okada, who owns slot machine manufacturer Universal
Entertainment, wants to create a name in the gaming industry.
"If Japan opens casinos, he (Okada) can say that he has the experience," he
said.
Naguiat also explained the $110,000 alleged cash gifts mentioned in the
lawsuit covered the period 2008 to 2011 and all casino regulators worldwide.
"By destroying the credibility of Pagcor, you're destroying the credibility
of the entire Entertainment City," he said.
Asked if he thinks Okada's investment in the project is now in trouble
because of the controversy, Naguiat said: "As of now it is not in jeopardy."
"His problem is to look for a Filipino partner," he said.
Lacierda yesterday confirmed there were negotiations for a meeting between
President Aquino and Wynn but that it "never pushed through."
"Most likely, if business people would come over, it would be to express to
the President their investment commitments. That's normally when business people
would come, pay a courtesy call and inform the President this is what we intend
to do," he related.
Lacierda said it was a non-issue between Pagcor and Wynn even in the wake of
payoff accusations.
Lacierda said this is the position that was taken by no less than the
President himself.
"He (Aquino) was made aware (of the issues). That's precisely what he said,
the explanation given by chairman Naguiat. It's an industry practice," he said.
"In that perspective where we're able to save on cost and it's an industry
practice, that's what he mentioned. In the matter of being able to save on
costs, that is beneficial to the government and Naguiat never profited from it
personally," he justified.
Pagcor awarded Okada's group a contract to build a hotel-resort complex in
Entertainment City during the Arroyo administration that ended in June 2010.
An investigation in the US also revealed former first gentleman Mike Arroyo
and former Pagcor chairman Efraim Genuino received benefits, which were then
extended to Naguiat, who took over in June 2010.
"I cannot speak for Mr. Genuino or the former first gentleman," Lacierda
clarified.
Genuino's counsel Ramon Esguerra denied his client received travel privileges
from a Japanese gambling operator in 2008 during the Arroyo administration.
Esguerra said Genuino did not travel on the dates mentioned in the
controversy involving Pagcor and Wynn Resorts.
"Look at the dates – Genuino did not travel in 2008. Even Malacañang is
saying there is nothing wrong (in the privileges)," Esguerra said.
"He has not gone out of the country since 2008. The travel documents of the
Bureau of Immigration (BI) will bear him out," Esguerra told reporters yesterday
at the sidelines of the Corona impeachment case where he is also one of the
lawyers.
He said the alleged gifts were nothing, and that some perks could be part of
reciprocal arrangements, echoing the Palace statement.
Aside from accusing Okada of improper payments to foreign gaming regulators,
Wynn also forcibly bought back Okada's 20 percent stake in the casino company at
a hefty discount.
Okada was also asked to resign as a director of Wynn Resorts, the company
said, adding that it will also recommend that he be removed as director from the
board of its Hong Kong subsidiary, Wynn Macau Ltd.
Naguiat, however, remains optimistic that the controversy would not deter
possible investors in the country.
He said two proponents, namely Bloomberry's Solaire and SM Consortium's Belle
Grande, are expected to open by 2013.
The project is expected to generate one million jobs and one million
tourists, Naguiat said.
The 12-hectare Pagcor Entertainment City in Manila Bay is touted as Manila's
equivalent of the Las Vegas strip.
Universal Entertainment's subsidiary is Tiger Resorts, Leisure and
Entertainment Inc.
Probe
Bayan Muna Rep. Teddy Casiño asked the House of Representatives yesterday to
look into the issue.
Casiño said the House should look into whether Naguiat and his predecessor
Genuino violated the Anti-Graft Law and the Code of Ethical Conduct and
Standards for Public Officials and Employees.
Casiño said he would not be surprised if Genuino accepted gifts, but "for the
appointment of the administration with an election campaign promise of
anti-corruption and matuwid na daan (straight path) to do this is alarming."
"Naguiat could have politely declined the offer of free accommodation and
meals so that everything is aboveboard. Even if they say that this is common
industry practice, a government official must ensure that he is beyond
reproach," he said.
He pointed out that Naguiat's acceptance of free hotel accommodation may be
industry practice, but it does not mean it is not prohibited under the country's
laws.
Three militant groups, on the other hand, said it would be "lawful and
politically correct" for President Aquino to cancel the contract between Pagcor
and Okada.
The $2-billion contract for a Las Vegas type entertainment center is
allegedly "tainted
with corruption and highly contrary to public interest and marine
environment," said the joint statement issued by Pambansang Lakas ng Kilusang
Mamamalakaya ng Pilipinas (Pamalakaya), the Koalisyon Kontra Kumbersyon ng
Manila Bay (KKK-Manila Bay) and Anakpawis-Manila Bay. – With
Delon Porcalla, Christina Mendez, Jess Diaz, Ding Cervantes
US suit tags Pagcor execs Naguiat, Genuino deny
wrongdoing By Daxim L. Lucas Philippine Daily Inquirer 12:17 am |
Thursday, February 23rd, 2012
The chairman of state-owned Philippine Amusement and Gaming Corp.
(Pagcor) on Wednesday denied allegations made by an owner of US-based casino
giant Wynn Resorts that he had received undue perks and favors from a Japanese
businessman.
Cristino Naguiat Jr., also the Pagcor CEO, said his name was being dragged
into a boardroom fray between two gaming magnates.
Naguiat said he did not receive a pricey Chanel bag meant for his wife from
pachinko tycoon Kazuo Okada during a visit to Macau in September 2010.
He acknowledged that he found a Chanel bag delivered to his room after his
return from one of his business meetings, but said that he returned it promptly
to his hosts.
Naguiat explained that he had casually told his liaison—one of Okada's
staffers— that he wanted to surprise his wife with a Chanel bag and was
astonished to find one delivered to his room later on.
"I was there to meet officials of Wynn Resorts and Mr. Okada was the vice
chairman of Wynn," Naguiat said in an interview with the Philippine Daily
Inquirer. "Maybe the staffer was just trying to impress his guests. In any case,
I had the bag returned immediately."
The allegation about Naguiat receiving the bag in return for favors to
Okada—an investor in Pagcor's $4-billion Entertainment City project—was
contained in a report prepared by a former Federal Bureau of Investigation
director, Louis Freeh.
The investigation was commissioned by Wynn Resorts, whose owner has had a
public falling out with Okada, his former partner.
"I'm the victim of a boardroom battle between giants," Naguiat said, adding
that he is being used by one side as ammunition against the other. "This is a
fight between giants."
US lawsuit
Okada was accused on Tuesday in a US lawsuit of paying off Philippine
regulators and cheating his powerful Las Vegas partner, Wynn Resorts chief
executive Steve Wynn.
In the lawsuit, Wynn Resorts said Okada, a director of Wynn, went behind the
company's back to develop business for his own Universal Entertainment group in
the Philippines and broke US laws on foreign bribery.
Wynn said Okada spent more than $110,000 to curry favor with two Philippine
officials in apparent violation of the US Foreign Corrupt Practices Act,
jeopardizing Wynn's own reputation in the process.
"Mr. Okada, his associates and companies appear to have engaged in a
longstanding practice of making payments and gifts to his two chief gaming
regulators at Philippine Amusement and Gaming Corp., who directly oversee and
regulate Mr. Okada's provisional licensing agreement to operate in that
company," the lawsuit said.
The suit, filed in a Las Vegas district court, said Okada had sought a gaming
license in the Philippines and made the payments despite Wynn's telling him not
to do so. It named Naguiat, former Pagcor chairman Efraim Genuino and their
families, as the recipients of the payoffs, which dated to 2008.
Okada told a Wynn investigator that he had paid for Genuino's trip to the
2008 Beijing Olympics, Wynn said.
Wife, kids, nanny
The suit alleged that Naguiat, his wife, three children, nanny and company
officials had a five-day trip to Wynn's Macau resort in 2010 during which Okada
met with the Pagcor chairman to discuss his Manila casino venture.
Okada's Universal Entertainment broke ground for its Manila Bay Resorts
casino on January 26, promising more than 2,000 guest rooms in three hotels,
with the planned opening in the first half of 2014. Universal, through Aruze
USA, was one of four winners of provisional gaming licenses awarded by the
Philippine government in 2008.
The Japanese gambling tycoon allegedly ordered that Naguiat be given the most
expensive accommodations at the resort—a $6,000-a-night villa normally reserved
for high rollers—as well as use of the casino's best butler.
More than $50,000 was spent on Naguiat's visit, including about $20,000 in
cash given to the Filipino delegation for shopping and gaming, the suit alleged.
Naguiat also requested and received a Chanel designer bag worth 15,000 Macau
patacas ($1,878) for his wife, according to the suit.
Malicious
Naguiat—a friend of President Benigno Aquino III who was actively involved in
the 2010 presidential campaign—decried the reports about him in the foreign
media as "malicious."
Naguiat said that the probe report which mentioned his name as part of the
Chanel bag issue was quoted liberally by foreign journalists, while excluding
the footnote at the bottom of the page—in fine print—which mentioned that he
did, in fact, return the bag.
He said he received reports that at least one of Wynn's publicists had called
up journalists whom they felt did not press on the Chanel bag issue enough.
Free accommodations
Naguiat did admit, however, that he enjoyed free accommodations at a Wynn
Resorts suite in Macau during that visit which was provided by his hosts.
He disputed the $6,000-a-night price tag ascribed to the hotel room, saying
the particular suite he stayed in had no published rates as it was used only to
accommodate the resort's VIP guests.
"You can't book that room as a walk-in guest even if you wanted to," he said.
"So I don't know how they got that figure."
The Pagcor chairman said it was standard operation procedure in the
hospitality industry to provide free accommodations to guests invited to engage
in official business with their hosts.
"Here in the Philippines, when we invite guests, we shoulder their
accommodations, we assign a car to bring them around and we assign a 24-hour
security detail to them if they are VIPs," he said.
His wife and children paid for their own expenses during that trip, Naguiat
said.
He added that he never received the $20,000 expenses supposedly credited to
his visit by his hosts, adding that this may have been credited to his room or
his liaison, possibly used to acquire the Chanel bag.
'Fight it out'
Naguiat said he had briefed Palace officials about the issue and that he had
been advised to "fight it out" if he believed that he did not do anything wrong.
Malacañang expressed confidence that Naguiat would be able to clear his name.
"(T)he point really here is, did he benefit personally?" presidential
spokesperson Edwin Lacierda told reporters as he reiterated the Palace stand
that it did not see anything wrong with Naguiat's acceptance of hotel
accommodations from Wynn Resorts as it was industry practice and saved costs for
the government.
Lacierda confirmed that Naguiat had arranged a meeting between President
Aquino and Steve Wynn but it did not push through. The aborted meeting had to do
with a possible business investment, according to Lacierda.
"There's nothing wrong with that. There are many business people who want to
inform the President that they are bullish about the Philippines," Lacierda
said. "This is not a special case."
Lacierda said Pagcor was envisioning to build a Pagcor City that was not
purely for gambling but also one that would provide entertainment to families.
Pagcor vice president Francis Hernando said the Wynn suit would not adversely
affect Okada's plans for Manila. "It's full steam ahead as far as its execution
is concerned," he said.
A member of the House committee on games and amusement found nothing
irregular in the accommodations and perks given by Okada to Pagcor officials.
"Pagcor is just collateral damage in the corporate dispute between Okada and
his partners at Wynn Resorts. I think the two should settle their dispute before
Pagcor should entertain their proposal," Eastern Samar Representative Ben
Evardone said in a text message.
Latest step
The suit was the latest step in the acrimonious fight between Steve Wynn and
his longtime partner Okada. On Sunday, Wynn's board voted to force out Okada,
who controls a 20-percent stake in the company, which owns casinos in Las Vegas
and Macau.
The board also moved to redeem Okada's 24 million shares at a 30-percent
discount and payable in 10 years, held through Aruze USA Inc., a Universal
subsidiary.
In a statement on Sunday, Universal branded the board's action outrageous,
saying the investigation had been rushed. "Universal Entertainment will take all
legal actions necessary to protect its investment and prevent a forced
redemption of its shares," it said.
$135-M donation
The row between Wynn and Okada burst into the public spotlight in January,
when the Hong Kong-based businessman sued Wynn, intending to gain access to
records surrounding a $135-million donation the company made to the University
of Macau.
Okada, Wynn Resorts' largest shareholder, sued Wynn Resorts in January for
denying him information about the donation, which he called "inappropriate."
The US Securities and Exchange Commission is looking informally into the
issue. With reports from AFP, Reuters, Christine O. Avendaño
and Gil C. Cabacungan
Chief News Editor: Sol
Jose Vanzi
© Copyright, 2012 by PHILIPPINE HEADLINE
NEWS ONLINE
All rights reserved
PHILIPPINE HEADLINE NEWS
ONLINE [PHNO] WEBSITE
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