Sands Corp. has many eyes watching

The issues are complex and riddled with ominous overtones, but by now some of the controversial names associated these days with Las Vegas Sands Corp. ought to sound familiar.

You're forgiven for confusing the multiple federal investigations of the Las Vegas-based casino giant. It isn't often in Nevada's history that a publicly traded gaming company has been compelled to balance doing business in a competitive marketplace with separate Department of Justice investigations into possible money laundering and violations of the U.S. Foreign Corrupt Practices Act. But that's just another day in the life of Las Vegas Sands.

The investigations come at a time Las Vegas Sands Chairman Sheldon Adelson has made headlines as a multimillion-dollar donor to Republican Party causes and the presidential campaign of Mitt Romney.

The company's balancing act grew all the more intriguing with the news from The Wall Street Journal on Monday that its lawyers have been in discussions with federal prosecutors in an attempt to settle the money-laundering probe. The story reports that representatives of both sides spoke as late as last Thursday after a July meeting in which prosecutors made clear, according to the paper, "they could indict Las Vegas Sands on charges of conspiracy to commit money laundering and possibly charge a company executive in the case."

A settlement prior to indictment, conversely, could result in a fine and an agreement to change the way it handles customer money, the newspaper reported. Sands officials, meanwhile, have consistently maintained that no improper actions have taken place and the company is cooperating with the money-laundering investigation involving controversial former casino high rollers Zhenli Ye Gon and Ausaf Umar Siddiqui.

Ye Gon is the Shanghai-born Mexican national suspected of playing an integral role in an international methamphetamine operation associated with the Sinaloa drug cartel.

In what has been described as the largest single drug cash seizure on record, in March 2007 Drug Enforcement Administration agents and Mexican law enforcement authorities recovered approximately $207 million in cash from Ye Gon's Mexico City home. In the days that followed, it was reported that the founder and legal representative of Unimed Pharm Chem Mexico had gambled more than $100 million at The Venetian and other casinos. Ye Gon in part used storefront cash-exchange shops in Mexico to transfer funds, the newspaper reported.

Did the casino company conduct sufficient due diligence? Did the government investigate potential money laundering violations in a timely manner?

How much player information can a casino company reasonably be expected to collect? Where does respecting player confidentiality stop and practicing "willful blindness" begin?

While I'm asking questions: Why is the U.S. attorney's office in Los Angeles leading a federal money-laundering probe with so many obvious Las Vegas ties?

While Ye Gon fights extradition to Mexico, former Fry's Electronics Inc. official Siddiqui's gambling and criminal biography is better established. Siddiqui used his position with the electronics company to extort millions in kickbacks from vendors. Some of that money went to pay his mounting casino debts with The Venetian and other casinos. He embezzled more than
$65 million from the company and is serving a six-year prison sentence.

As if that weren't more than enough to keep corporate lawyers and Nevada gaming regulators busy, there's also the pesky matter of the ongoing Justice Department and Securities and Exchange Commission investigations into whether Las Vegas Sands during its monumentally successful casino expansion in Macau violated American laws against bribing foreign officials.

At the Gaming Control Board, officials can't be blamed if they're feeling a little overwhelmed. Recently appointed control board Chairman A.G. Burnett reassured skeptics the state's casino regulatory agency is closely scrutinizing all developments in the federal investigations.

"Obviously, we're in contact with all the federal authorities," Burnett said. "Our position is that we monitor the litigation, and if there's any settlement we'll get it and analyze it and determine how we'll proceed, if at all."

Sounds like the control board will have plenty of monitoring to do in the coming months.

John L. Smith's column appears Sunday, Tuesday, Wednesday and Friday. E-mail him at Smith@reviewjournal.com or call 702-383-0295. He blogs at lvrj.com/blogs/Smith