Wynn Resorts Contemplating Appeal Over $35.5M Fine Levied by Massachusetts Gaming Commission
Posted on: May 13, 2019, 08:58h.
Last updated on: May 13, 2019, 08:58h.
Wynn Resorts officials say they are reviewing an appeal of their $35.5 million in fines issued against the company by the Massachusetts Gaming Commission (MGC).
The state gaming regulator announced the fines earlier this month for the company’s alleged failure to properly disclose knowledge of sexual misconduct claims against its founder and former CEO during its 2013 bidding for the Boston casino license.
At the time, the company was deemed suitable for licensure, and Steve Wynn “highly ethical” who is “a perfectionist who is passionate about everything he does.”
Then came January 2018. News broke via The Wall Street Journal that detailed decades of alleged sexual wrongdoings at the hands of the billionaire. Mr. Wynn denies he ever took advantage of female staffers, but has since resigned from the company he founded and sold off his entire stake.
The MGC fined Wynn Resorts $35 million, but allowed it to keep the $85 million casino license. The company plans to open the $2.6 billion Encore Boston Harbor next month.
The MGC additionally fined Wynn CEO Matt Maddox $500,000 for “his clear failure to require an investigation about a specific spa employee complaint brought to his attention.” The gaming agency is also requiring the chief executive to undergo various leadership training.
During the company’s earnings call last week, Maddox revealed the board is considering appealing the fines.
We are still reviewing the decision as it relates to some of the secondary and tertiary conditions imposed by the commission,” Maddox explained. “We do not believe if we choose to appeal if that will impact our ability to open the project at the end of June.”
Encore Boston Harbor is slated to open June 23. The casino resort will feature 242 table games and 3,100 slot machines.
The MGC says its conclusions are final, and Wynn Resorts is not entitled to “any further review from the commission’s determination of suitability.” That’s actually good news for the casino giant, as it means no court can revoke its license for the Boston complex.
“There was no impact on the suitability of the company, or its key employees to hold a gaming license in the state,” Maddox told investors and analysts. However, Wynn Resorts can appeal the fines issued by the MGC through an appellate court.
In Nevada, state gaming regulators issued Wynn Resorts a $20 million fine for “a failure of corporate culture to govern itself.” It’s the costliest penalty ever issued by the Nevada Gaming Commission in the state’s long gaming history.
Wynn Resorts fell short of financial Wall Street expectations in Q1. Operating revenue totaled $1.65 billion, slightly below the $1.67 billion consensus among analysts.
Elaine Wynn – the former wife of the billionaire casino tycoon who cofounded Wynn Resorts in 2002 – says she plans to stay on with the company. She owns a nine percent stake in the organization, which makes her the largest individual shareholder. “I am team Wynn,” the 77-year-old told the MGC last month.