PAGCOR Officials Flunk Straight-Path Test!

by Joseph G. Lariosa

CHICAGO (jGLi) – When Noynoy Aquino launched his presidential campaign in 2010, he mesmerized the people with a promise to be a Pied Piper that will lead the country toward a straight path.

No doubt, the Filipino people agreed with his message loud and clear when they gave Aquino a chance by electing him president.

Unbeknownst to Mr. Aquino, even non-Filipinos are closely watching if his campaign can separate his administration from the graft-ridden ways of outgoing President Gloria Macapagal Arroyo (GMA) as the Philippines languishes as the 129th among the 185 countries in the Corruption Perceptions Index as ranked by Transparency International since 1995. (The United States is 24th.)

Apparently, some members of Aquino official family are not yet ready to tread the daang matuwid (straight path).

Perhaps, what Noynoy needs is to give his official family a rigid anti-graft sensitivity re-orientation before they are ushered into the well of the Philippine Senate for confirmation.

When Japanese Kazuo Okada, one of the directors of Wynn Resorts based in Las Vegas, Nevada, a world-class developer of destination resort casinos, learned of opportunities of “creating a casino resort in Manila Bay,” Okada tested the waters if Stephen A. Wynn, chairman of Wynn Resorts and other members of the board would be interested.

When Mr. Wynn and other members of the board noticed that Mr. Okada was straying off the straight path by employing shady tactics in pursuing his dream to build the “Entertainment City Manila,” they reminded Mr. Okada that he should instead abide by Wynn Resorts’ Code of Business Conduct and Ethics and the Foreign Corrupt Practices Act.


After investing US$300- to $400-million while planning to set up the 30-hectare Manila Bay resort city, Mr. Okada had obtained “four provisional gaming licenses without public bidding” from the Philippine Amusement and Gaming Corporation (PAGCOR) chair under GMA’s Efraim C. Genuino in 2008.

Undeterred by rejection, Okada, who owns 19.66 percent of Wynn Resorts, owners of Wynn Las Vegas, LLC (WLV) thru Wynn Macau, Ltd. (WM), a Cayman Islands company, publicly traded on the Hongkong Stock Exchange, went ahead with his pursuit of his “personal agenda” to put up casino resorts in Manila under the Aquino administration.

But his plan would put Mr. Okada in direct conflict with Wynn Macau, which is partly owned by Mr. Okada. Wynn Resorts does not want Mr. Okada to use its “trade secrets” and its own resources in running the Manila casino resorts.

Wynn is also questioning that the corporate ownership structure of the Manila casino resort of Mr. Okada, who is putting up dummy corporations to circumvent the law, limiting maximum foreign ownership at 40 percent.

Okada earlier announced he and his Aruze USA, Inc. and Universal Entertainment Corp. planned to lure high-limit, VIP gamblers from China to its Manila Bay resort-casino, the same customer base of Wynn Macau.

Universal purportedly intends to construct two casinos and three hotels in Manila by December 2013; intends to open those facilities in early 2014; intends to spend $2.3-billion in the projects; and hopes to turn $2-billion in sales in its first year of operation. Okada plans to open more casinos in 2015 in Asia, presumably South Korea. According to the court filings by lawyers James J. Pisanelli, Paul K. Rowe and Robert L. Shapiro before the District Court of Nevada in Las Vegas obtained by this columnist, at one instance, Okada’s Aruze company wired retainer funds to the bank account of Mr. Manuel M. Camacho’s firm, an account controlled jointly by Mr. Camacho and Erwin Genuino, son of former PAGCOR chair. Later, Mr. Camacho discovered that all or most of these funds had been withdrawn by Erwin Genuino. When Camacho questioned the withdrawal, he was eventually told by Mr. Rodolfo Soriano and/or then, PAGCOR Chair Genuino that the funds had been withdrawn to be used as “cash payoff” to the “mayor of the municipality in which the entertainment city of Manila project is located.”


The “cash payoff” was to “facilitate approval of the use of some plots of land to build roads need for Mr. Okada’s casino project.”

This lack of transparency, like the lack of public bidding, is a business practice that Wynn Resorts is tying to avoid.

Despite the cold shoulder shown by Wynn and company on Okada’s plan at a board meeting last year (Feb. 24, 2011), Mr. Wynn told the board that he had been invited by Okada to meet President Aquino. But the independent board of directors “advised Mr. Wynn” against meeting with Mr. Aquino.

But what really got the board’s goat was Okada’s remarks that third parties (“consultants”) may make payments to government officials, which is direct violation of the Foreign Corrupt Practices Act and the Wynn Resorts’ Code of Conduct and other policies.”

Because Mr. Okada appeared to be ducking the awareness training against paying government officials among the board, the board hired the services of former Director of the Federal Bureau of Investigation, Louis J. Freeh, who deposed Mr. Okada in Tokyo, Japan. The  board accused Mr. Okada of engaging in “acts that would render him unsuitable under Nevada gaming regulations, and, breaching the fiduciary duties he owed to Wynn Resorts.” The board is seeking punitive damages against Mr. Okada.

In other words, if Mr. Okada were a professional boxer and if he were found to be guilty as “unsuitable under Nevada gaming regulations,” Mr. Okada can no longer fight as a professional boxer in Nevada. Or he could no longer engage in casino business in Nevada.

As to the $110,636 that was spent by Okada to entertain PAGCOR officials so he can put up his casino business in the Philippines, it includes $1,870 from former PAGCOR chief Efraim C. Genuino for his stay in Wynn Macau from June 6-9, 2010, three weeks before he bowed out of office. But as to the expenses Genuino’s group incurred when Mr. Okada invited the group to Beijing Olympics, investigation is still underway on this matter.

But what was unconscionable was the acceptance by new PAGCOR chair, Cristino L. Naguiat, of Okada’s invitation to sample the Wynn Macau, where Mr. Naguiat requested that his presence was supposed to be “incognito” in violation of Macau law that requires “all room occupants be registered … in advanced of or at the time of registration.”

I think, this is a fire code requirement just in case there is a fire in the hotel and there is a fatality in the room, it is faster to identify a victim.

When Mr. Naguiat, his wife, Teresa Socorro Naguiat, their three children and their nanny occupied the most expensive hotel room at Wynn Macau at US$6,000 a day, Mr. Naguiat should have clarified first with Mr. Okada as to who would foot for the bill.

Mr. Naguiat’s family, who was provided with US$20,000 shopping money, and some of the 13 other members of the party given US$5,000 each for a total of US$50,000, are now likely to pay for refund as Mr. Okada had denied providing them the luxury accommodation and advancing the $50,000 shopping money.

If Mr. Okada will affirm his testimony before former FBI Director Freeh in court, it is going to be a king-size embarrassment for Mr. Naguiat for exercising poor judgment in accepting Mr. Okada’s invitation, without clarifying as to who will pay for their VIP treatment.

If Mr. Aquino will just look the other way, it will speak volumes of his tuwid na daan (straight-path) mantra that could make the Philippines a butt of jokes in the international community.

Mr. Naguiat, his predecessor, Ephraim Genuino, and other PAGCOR officials and other freeloaders and even former First Gentleman Jose Miguel “Mike” Arroyo, who signed their hotel accommodation checks at Wynn Las Vegas and Wynn Macau for a total of $110,636 without paying should hope and pray that Mr. Okada be declared to be suffering from Alzheimer disease so that Mr. Okada’s company, Universal and Aruze City Ledger will cover for their perks! (

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