Legal woes continue to be a thorn in the side of American gaming companies. Wynn Resorts
Bribery and deals of questionable legality are nothing new in Macau. Stanley Ho, who used to have a monopoly on gambling there, was often tied to organized crime. His ties even forced MGM Resorts
Jacobs, former head of Macau operations for Las Vegas Sands, is trying to uncover documents he says he kept in a folder labeled "Outrageous," according to The Wall Street Journal, documents that highlight the prostitution strategy, deals with organized crime members, and hiring of illegal construction workers, among other things. At the very least, we know that prostitution was reported on a widespread level at The Venetian Macau because 100 suspected prostitutes were arrested while Adelson was visiting in 2010.
What it means for you
The mudslinging between Adelson and Jacobs has been going on for two years and with the SEC and Department of Justice involved it will be at the very least a nuisance for the company going forward. That will place a cloud over Las Vegas Sands, but I see it as highly unlikely the company will be meaningfully affected by any lawsuits.
Macau has had all kinds of questionable practices and both family and political connections play a much larger role than they would in a more open market. Just look at gaming companies: Melco Crown's
It's a tangled web in Cotai and right now Las Vegas Sands is at the center of the mess. It isn't a reason to sell right now, but it will be worth keeping a close eye on.