Saturday, September 29, 2012

WMR: Romney "family values" campaign cash siphoned from Chinese gamblers

WMR has discovered that the campaign of GOP presidential candidate Mitt Romney has been receiving campaign cash donations from U.S.-owned casinos in the Macau Special Administrative Region, mostly though the auspices of Republicans Abroad, which maintains a large and active chapter in Hong Kong that also covers expatriate Republicans in Macau and the Guangdong province of southern China.

Three of the six casino operators in Macau are American-owned: Sheldon Adelson's Sands China, Steve Wynn's Wynn Resorts casino, and MGM, which is owned by private investors. Gambling is legal in Macau and the casinos draw millions of visitors from countries where gambling remains illegal: China, Hong Kong, Taiwan, and a number of other countries in the region. Adelson and Wynn are supporters of the Republican Party.

Although Macau has instituted a "responsible gaming" program that seeks to deter gambling addicts, the Chinese are avid gamblers and the number of pawn shops in Macai attests to the fact that many Chinese and Hong Kong residents will hock everything from their wedding rings to expensive wristwatches to hit it big at the casinos.

Romney frequently talks about his commitment to "family values," yet his campaign is flush with money from Chinese gamblers whose addictions have broken apart families through divorce and even suicide.

Although Macau gaming authorities ensure that the casinos pay 42 percent tax to the Macau government, there are no tax declarations, such as those required by the Internal Revenue Service in the United States, made by casino winners, including high-stakes gamblers, at the Macau casinos.

In a variation of the infamous 1960s-era Las Vegas "skim," which saw the Italian mob pocket before-tax casino profits, the Macau skim that profits the Romney campaign is through tax-free winnings by high-stake gamblers in super-private VIP rooms. The unreported cash winnings are laundered through the maximally-allowed donations from southern China's Republicans Abroad, which is based in Hong Kong.

What is even more astounding is that the FBI's Legal Attache's office in Hong Kong is aware of the unique skim.

An agent from the FBI's Hong Kong office frequently travels to Macau to meet with security officials of the U.S.-owned casinos. WMR has learned from Hong Kong intelligence sources that the FBI has an arrangement with the Adelson-owned casinos to conduct covert surveillance operations of high-value guests, including senior Chinese government officials.

In return, the FBI has looked the other way as taxable cash "won" by Republicans abroad is funneled into the Romney campaign as legal "private" donations.

One ex-FBI agent who headed up security for the Sands Macau at its start-up in 2004 left his job after discovering certain practices that he termed "scary."

Adelson has been a multi-million dollar donor to the presidential campaigns of Romney and Newt Gingrich. However, partly as a result of the Supreme Court's Citizens United decision that recognizes corporations as people as far as political donations are concerned, campaign cash can be derived from a variety of sources, although foreign donations remain illegal.

What has been established in Macau is a virtual foreign cash source for Romney, one that has the appearance of legality through Republicans Abroad, but which is, nevertheless, illegal.

Adelson and Wynn have been at the center of an investigation over the payment of bribes to Macau officials.

The Adelson matter arose from charges made by the former CEO of Sands China, Steve Jacobs, after he was fired by Adelson. Jacobs charged that Adelson wanted to increase the availability of prostitutes at his Macau casinos: The Sands, The Venetian, the Sheraton Cotai Central, and The Plaza, to increase profits, which are generally down in Macau.

However, WMR found no evidence of rampant prostitution at Sands properties. Sands security appears to run a tight ship on the prostitution angle.

Some Democrats, charged that Adelson was profiting from prostitution in Macau. Adelson sued the National Jewish Democratic Council for libel in response to the Democratic group's charges that Adelson approved of prostitution at his casinos in Macau. WMR's investigation found no evidence of Sands' casinos permitting or profiting from prostitution, which, although legal in Macau, is deterred in the increasingly "family friendly"-themed casinos in the former Portuguese "anything goes" territory.

Democratic groups were quick to accuse Adelson of facilitating prostitution at his casinos. The only sign of prostitution in Macau is from the cards and flyers that are strewn on Macau sidewalks and pedestrian bridges.

While Adelson can be cited for many things, prostitution at his Macau casinos is not one of them. The only pick-up WMR witnessed was a Chinese female with a stack of chips, who appeared legitimate, scored a customer at the bar at The Sands.

But as Sands China security told WMR, the freelancers are hard to combat although efforts are made to eject them from the casinos.

However, the modified "Macau skim" that directly aids the Romney campaign is a serious issue that threatens to upend American democracy.

exclusive copy: Wayne Madsen Reports
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