Nevada gaming officials have been investigating Wynn Resorts Ltd. Over the course of the last several years, and that investigation has finally come to an end. It was originally asserted by a Japanese billionaire that the casino operator and made improper donations to the University of Macau, and complain that unfair practices were being conducted by the company. However, at this time there was no evidence of wrongdoing. In addition to this, the company stated in federal court granted its motion to dismiss the shareholder complaint against the company related to the donation, and no wrongdoing was found at the time. The regulatory body stated that there was no legal basis for the investigation to continue.
The accusations actually come from an ongoing personal battle between two former friends and business partners. The previously mentioned Japanese billionaire is Kazuo Okada, who had a very well known falling out with the company CEO Steve Wynn. At one point, Okada used to be the single largest shareholder in the company. He tried to forcibly purchase back all of the shares after it was found that the Japanese billionaire had made unlawful payments to overseas gambling regulators, in an effort to distance the company from those activities. Since that time, the two have continued to trade accusations with one another, alleging nefarious activities and improper payments across the board. This, combined with several ethical complaints, have made this a very heated battle between the two former friends.
At this point, Wynn is looking to remove Okada from its board, a position that he still holds from when he was the largest shareholder within the company. With a meeting coming up on 22 February, the company is looking to have him removed from the board before that time. Okada have filed suit in the Nevada federal court to halt the meeting, while the other issues play themselves out. The company responded by saying that they had already deemed him unsuitable for the board, after a lengthy investigation by the former director of the FBI Louis Freeh, uncovered evidence of improper conduct in connection with a number of companies in dealings that he had dealt with previously. On Monday, Wynn stated that Institutional Shareholder Services Inc, which operates as a major proxy advisory firm, issued a report recommending that the board was able to remove Okada from all future proceedings. Shares for the company fell $.11 to a total of $126.26 in morning trading after this news was released by major media sources.
It will be interesting to see how the argument between the company and their former lead investor, play out in the future. It is clear that the two have had a bitter rivalry since the original findings, and it will be interesting to see if Okada is able to salvage his reputation in the wake of these findings. Although there have been many accusations of unethical conduct in the past by individuals connected to this industry, it has never pitted two industry giants against one another in the same way that this circumstance has.