Updated July 9, 2018 - 12:46 pm
Las Vegas police are conducting a criminal investigation into the handling of $90,000 worth of Southwest Airlines gift cards secretly purchased by the Las Vegas Convention and Visitors Authority, the Review-Journal has learned.
Detectives from the Metropolitan Police Department’s criminal intelligence section showed up June 28 at the office of Ed Finger, the convention authority’s chief financial officer, and left with records related to an audit that found that the agency had misused the airline cards, informed sources said.
Police are looking at possible theft and embezzlement charges, one of the sources said.
“It’s bothersome, but when the law gets involved, you want to do the right thing,” Clark County Commissioner Lawrence Weekly, who chairs the authority’s board, said Monday. “We’re just making sure that everybody answers whatever questions that need to be answered.”
Bill Noonan, who chairs the board’s audit committee, said the panel viewed the audit as a serious matter.
“As such, we will cooperate fully as an audit committee with any request for information,” he said.
Authority executive Brig Lawson hid the gift card purchases, and auditors could not account for more than $50,000 worth of the cards, an audit report showed last month. The tourism agency’s CEO, Rossi Ralenkotter, used $16,207 in cards to take personal trips with his wife. Weekly also used about $700 in travel cards for a trip with his daughter.
Lawson has since resigned as the authority’s senior director of business partnerships, and both Weekly and Ralenkotter reimbursed the authority for the cards they used. Ralenkotter is now considering retirement after 14 years at the helm of the publicly funded agency.
Convention authority spokeswoman Jacqueline Peterson on Monday would not discuss the police investigation.
“We are committed to transparency, and of course we respond to questions and requests for information,” she said. “You will need to direct inquires for specific information to Metro.”
Lawson and his lawyer could not be reached for comment. A Southwest Airlines spokesman declined an interview, and police did not respond to a request for comment.
Last month, the convention authority board tightened controls in response to the Southwest Airlines purchases, which occurred between 2012 and 2017.
Noonan ordered the travel gift card audit in February amid a Review-Journal investigation into lavish spending at the agency and perks for board members and staff.
The Review-Journal requested employee gift and travel records more than a year before the board hired the auditors, but the authority did not provide any records of the airline cards. It maintains that there was no process in place at the time to track usage of the cards.
In funding requests, Lawson said the gift card purchases were for promotional events with Southwest. He did not disclose that the requests were for the cards, the audit showed. Lawson also instructed Southwest employees not to mention the cards in invoices submitted to the convention authority, the report showed.
Lawson told auditors he did not know that Ralenkotter had used the cards for personal travel, and auditors did not uncover evidence that Ralenkotter knew that Lawson had bought the cards with agency funds.
Ralenkotter indicated during the audit that he thought the cards were given to the authority for promotional purposes. The agency’s travel coordinator told auditors that Ralenkotter, whose annual compensation and benefits package approaches $1 million, kept Southwest gift cards in his office desk.
Ralenkotter has apologized for his personal use of the Southwest cards. The convention authority no longer allows the cards to be used for personal travel.
Attorney Todd Bice, who oversaw the audit, told board members last month that because of poor record keeping, it would cost more than the $50,188 in missing cards for auditors to try to find out what happened to them. Based on Bice’s recommendation, the board closed the audit last month.
Bice declined to comment Monday.
On Tuesday, the board will discuss possible payment of up to $200,000 to Bice’s law firm for its work with auditors.
Another major company, Delta Airlines, gave the authority thousands of dollars in travel certificates in return for being included in the agency’s ad campaigns and receiving shared space at trade shows. The authority also agreed to list Delta as a “preferred partner” on its website, auditors said.
But the trade was done in the open, and the agency did not book any flights for business or personal use with the certificates, the audit showed.
The Review-Journal is owned by the family of Las Vegas Sands Corp. Chairman and CEO Sheldon Adelson. Las Vegas Sands Corp. operates the Sands Expo and Convention Center.