Regulators leery of problems in Macau

UFA

Nevada gaming regulators are concerned that Strip developers Steve Wynn and Sheldon Adelson could enter a troubled business, political and legal climate in Macau.

The Desert Inn and Venetian owners head two of the three groups that were chosen as semifinalists by Macau officials to build casinos in the $2 billion gambling market that is controlled by mainland China.

The former Portuguese colony, which borders southeastern China and juts into the South China Sea, is a popular destination for Asian gamblers and has a centuries-old reputation for lawlessness that is reflected in reputed links between organized crime and government officials.

Macau’s gaming properties are money makers for prostitutes and loan sharks, who openly conduct business in the casinos. Law enforcement officials believe protection money is often paid to organized crime triads and political leaders to ensure peaceful operations, although Chinese government officials have said that is all about to change.

“I’m concerned because the history of Macau is somewhat jaded in respect to regulated-type activities,” Nevada Gaming Control Board Chairman Dennis Neilander said. “You have to do a substantial amount of due diligence (or background research on people and businesses) to reach some comfort level.”

But it is difficult, Neilander noted, to guarantee the accuracy of the information gathered on potential Chinese and Macau-based partners.

“The whole political and cultural environment for doing due diligence is far different from in the United States,” Neilander noted.

Macau is a one-hour, high-speed boat ride from Hong Kong. Like the former British colony, it was returned to Chinese rule in 1999 when it was given the semi-independent status of special administrative region.

The city of 438,000 people attracted 10.3 million visitors last year, or more than a quarter of the total that came to Las Vegas.

Last year, the Chinese government opened the …