Enforcement Action

 

Docket or Case Number:    N/A

Court:    N/A

Initiation Date:    01/19/2017  Information

Prosecuting Agency:    US Department of Justice

Name of Prosecuting Attorneys:   

  • David M. Fuhr, Trial Attorney, Fraud Section, Criminal Division

Assisting Agencies:    Undetermined , Federal Bureau of Investigation , Department of Justice- Criminal Division’s Office of International Affairs , United States Attorney's Office - Nevada

Type of Action:    DOJ Criminal Proceeding

Origin of the Proceeding:    N/A

Whistleblower:    Unknown

Case Status:    Resolved


Summary

Las Vegas Sands Corporation (LVSC) was a Nevada-based casino and resort company which operated through a network of subsidiaries, casinos, and gaming facilities in the United States, Macao, and Singapore. During the period of the alleged misconduct, LVSC's shares were publicly traded on the New York Stock Exchange, and the company therefore was an "issuer" within the meaning of the FCPA.

From 2006 through 2009, LVSC, through wholly foreign-owned enterprises based in China that were owned and incorporated by LVSC, transferred approximately $60 million to a Chinese consultant for the purpose of promoting LVSC's business and brands. Approximately $5.8 million was paid to the consultant without any discernable legitimate business purpose. The consultant had represented to LVSC that he was a former PRC government official, and had advertised his political connections with PRC government officials as a primary qualification to provide assistance to the company.

On January 19, 2017, LVSC entered into a non-prosecution agreement (NPA) with the DOJ. Purusant to the terms of the NPA, LVSC agreed to pay a $6.96 million criminal penalty, which reflects a 25-percent reduction off the bottom of the applicable U.S. Sentencing Guidelines fine range. LVSC also agreed to enhance its compliance program, and to report to the department on the implementation of its enhanced compliance program. The DOJ cited a number of factors in support of this resolution, including the company's cooperation and extensive remedial measures. The company did not receive voluntary disclosure credit because "it did not voluntarily and timely disclose to the Fraud Section the conduct described in the Statement of Facts."

In related proceedings, on April 7, 2016, the SEC filed a cease and desist order against LVSC, pursuant to which LVSC agreed to pay a civil penalty of approximately $9 million.

Country(ies) involved:    China

Sanction to Bribe Ratio:    $6,960,000 / $5,800,000 = 120.00 %

Sanction to Revenue Ratio:    N/A

Sanction to Profit Ratio:    N/A

Number of Related Enforcement Actions (Including This Enforcement Action):    2

Country(ies) involved:    China

Total $ Bribery Payments:    $62,000,000

Total $ Revenue Generated from Bribery:    N/A

Total $ Profit Earned or Expenses Avoided from Bribery:    N/A

Total $ Monetary Sanctions:    $15,960,000

Sanction to Bribe Ratio:    $15,960,000 / $62,000,000 = (25.74 %)

Sanction to Revenue Ratio:    N/A

Sanction to Profit Ratio:    N/A

Name:    Las Vegas Sands Corp.

Place of Incorporation:    United States

HQ Country(ies):    United States

Entity Type:    Public Company

FCPA Claims:    Books & Records, Primary, Issuer (15 U.S.C. § 78m (b)(2)(A)) ; Internal Controls, Primary, Issuer (15 U.S.C. § 78m(b)(2)(B))

Related Claims:    N/A

Statutory Basis for FCPA Jurisdiction:    Issuer

Period of Challenged Conduct:   2006 - 2009

Total Bribery Payments:    $5,800,000

Total Revenue Generated from Bribery:    N/A

Total Profit Earned or Expenses Avoided from Bribery:    N/A

Country(ies) involved:    China

Officials Potentially Influenced (Name; Title; Organization): 

Defendant-Related Entities Involved in the Misconduct:    Unnamed Las Vegas Sands Corp. Wholly Foreign-Owned Enterprise - Subsidiary

Third-Party Intermediary:    N/A

Types of Improperly Recorded Expenses:   Recording of Money

Cash, Wire or Check:    No Available

Purpose of Bribe:    Other beneficial outcomes

TRANSACTION OVERVIEW
Payments to Consultant

Period of Challenged Conduct:   2006 – 2009

Total Value of Challenged Conduct   N/A

Country(ies) involved:    China

Officials Potentially Influenced (Name; Title; Organization):  

    N/A

Defendant-Related Entities Involved in the Misconduct:    Unnamed Las Vegas Sands Corp. Wholly Foreign-Owned Enterprise - Subsidiary

Third Party Intermediary:    N/A

Types of Improperly Recorded Expenses:   Recording of Money

Cash, Wire or Check:    No Available

Purpose of Bribe:    Other beneficial outcomes

Misconduct by Subsidiary?  No


M&A Negotiated or Completed During Misconduct, Investigation, or Resolution?     No

Re: Las Vegas Sands Corp.

  • Inadequate internal controls or auditing

Mitigating Factors Referenced by the Government (Company Defendants):

Defendant Self-Report Cooperation Voluntary Remedial Measures Misconduct Limited to Low Level Individuals Other factors
Las Vegas Sands Corp.    

Aggravating Factors Referenced by the Government (Company Defendants):

Defendant Insufficient Cooperation Insufficient Remedial Measures
Las Vegas Sands Corp.    

Total Monetary Sanctions for the Action:    $6,960,000

Case Status:    Resolved


Disposition:    Non-Prosecution Agreement

Date of Disposition:    01/20/2017

Las Vegas Sands Corp.

—  Total Monetary Sanctions for Defendant:    $6,960,000

—  Organizational Probation:    None

—  Compliance Obligation:    Yes

—  Reporting Obligation:    Hybrid

—  Admission of Guilt/Acceptance of Responsibility:    Yes

No Document Title Date Category