PH officials deny casino graft

by Cecil Morella, Agence France-Presse

Posted at Feb 23 2012 06:30 AM | Updated as of Feb 23 2012 04:49 PM

MANILA (UPDATE) - Philippine authorities confirmed Wednesday that top gaming officials accepted free luxury accommodation from a Japanese tycoon but denied these were bribes to ensure a new Manila casino was built.

US-based Wynn Resorts filed a suit on Tuesday accusing Kazuo Okada of spending more than $110,000 in travel expenses and gifts on the officials so that his mega-gaming venue in the Philippine capital went ahead.

The suit against Okada, a director of Wynn with a 19.7-percent stake in the firm, alleged the suspect payments were made to two chairmen of the Philippine Amusement and Gaming Corporation (Pagcor) from 2008 to last year.

The top officials' relatives and associates were also beneficiaries, as was the current chairman's nanny and the husband of then-president Gloria Arroyo, the suit alleged.

Pagcor, the Philippines' gaming regulator, awarded a license to Okada's Universal Entertainment in 2008 to build a gaming resort on the shores of Manila Bay featuring 2,000 guest rooms and three hotels.

Philippine President Benigno Aquino's spokesman and the gaming regulator confirmed Wednesday that current Pagcor chairman Cristino Naguiat had accepted free hotel stays at Wynn's Macau resort.

But they said this was standard procedure in the gaming industry, with foreign casino chiefs receiving free accommodation in return when they visited the Philippines.

"It's the gaming industry. There's a practice, that's an industry practice," presidential spokesman Edwin Lacierda told reporters, emphasising that the government believed Naguiat did not profit personally from the favours.

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 allegedly ordered that Naguiat be given the most expensive accommodation 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.

Pagcor Vice President Francis Hernando told AFP Wednesday that the allegations of cash payments and gifts were false.

"The insinuation that there were other things given beyond the standard reciprocity is malicious. They were not given anything else," he said.

The suit also alleged that Naguiat's predecessor at Pagcor, Efraim Genuino, had expenses paid for during a 2010 visit to Macau, and that Okada covered his trip to the Beijing Olympics in 2008.

Then president Gloria Arroyo's husband, Jose Miguel Arroyo, also enjoyed a week-long stay at the Wynn Las Vegas resort in 2009 that cost Okada's company $4,642, the suit alleged.

The Wynn suit said it had rejected Okada's repeated requests to form a joint partnership partly because corruption was "deeply ingrained" in the Philippines gaming industry.

It also said payments and perks such as those allegedly made by Okada may have violated the US Foreign Corrupt Practices Act, jeopardising Wynn's own reputation in the process.

Pagcor's Hernando said he could not comment directly on the allegations made against Filipino officials during Arroyo's term, which ended in June 2010.

But he said the allegations made by Wynn in its suit would not impact Okada's plans for Manila, with his casino due to open in 2014.

"It's full steam ahead as far as its execution is concerned," Hernando said.

Wynn's board earlier this week announced it was buying out Okada's stake in the company at a steep discount from the market price, prompting a furious reply from the Japanese tycoon.

"Universal Entertainment will take all legal actions necessary to protect its investment and prevent a forced redemption of its shares," a company statement said.

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