* U.S. regulators also investigating Philippine payments
* Philippine regulator reviewing Okada casino plan
* Universal shares drop 11 pct to nine-month low
By Kevin Krolicki and Rosemarie Francisco
TOKYO/MANILA, Nov 19 Prosecutors in Manila will
investigate whether bribes were paid in relation to the $2
billion Manila Bay casino being developed by Japanese
billionaire Kazuo Okada, a spokesman for Philippine President
Benigno Aquino said on Monday.
Edwin Lacierda, a spokesman for Aquino, told reporters the
country's Department of Justice had been asked to investigate
whether bribes were paid in relation to the project being
developed by Okada's Tokyo-based company Universal Entertainment
"If there's a proof that the licence was obtained through
bribery, then there may be reasons to consider cancelling the
contract," Lacierda said. "Obviously, it is something that we
will not countenance."
Shares in Universal sank to a nine-month low on Monday after
Reuters reported U.S. gaming regulators were investigating
payments from its affiliates to an associate of the former head
of the Philippine gaming regulator. Shares in
the Tokyo-based company closed down 11 percent on Monday and
have lost nearly 30 percent of their value this year.
Reuters reported on Friday that a Universal subsidiary made
a $5 million payment in May 2010 to Rodolfo Soriano, a close
associate of the former head of the Philippine Amusement and
Gaming Corp., the country's gaming regulator which is known as
The payment to Soriano was made at a time when Universal was
lobbying to win concessions for its casino from the
administration of then-Philippine President Gloria Macapagal
PAGCOR issued a statement on Monday saying the Reuters
report contained "serious allegations." The agency said it was
asking investigators to "get to the bottom of this alleged
payoff" and asked Philippine authorities to work with the
Federal Bureau of Investigation in the United States.
"The group of Mr. Okada is a major investor in the
Philippines and this is the reason why PAGCOR is giving them a
chance to address all the issues," the regulator said.
It added, if "they have violated Philippine laws and they
fail to comply with the provisions of the provisional licence
issued to them, they cannot commence their casino operations."
Universal spokesman Nobuyuki Horiuchi said the company had
no immediate comment.
The company, which is controlled by Okada, has been
developing a casino resort in the Philippines aimed at
high-rollers from China since 2008. Okada, who serves as
Universal's chairman, founded the company and remains an owner
of almost 70 percent of its shares through a family trust.
Monday's decline in Universal shares was the biggest one-day
percentage drop since Feb. 20 when Las Vegas titan Steve Wynn, a
former partner, said Okada's company had acted improperly in
paying for about $110,000 in entertainment expenses to foreign
gaming regulators, including officials from the Philippines.
Separately, a Philippine congressman who has urged the
government to suspend the Universal casino project called for a
legislative hearing on the matter. Rep. Teddy Casino had
previously submitted a resolution calling for an investigation.
"We will have to include new pieces of evidence unearthed by
Reuters news agency that can help complete the picture of
corruption in PAGCOR," Casino said in a statement.
Philippine Sen. Miriam Santiago also called for a Senate
investigation of the reported payment to Soriano, citing the
Okada has been seeking to have a U.S. court reverse an
earlier move by Wynn to redeem his shares in Wynn Resorts Ltd
at a 30 percent discount after the board determined he
was an "unsuitable" shareholder.
That finding was based in part on Universal's record of
paying for entertainment and lodging expenses for PAGCOR
officials, including Soriano and former PAGCOR chief Efraim
Genuino, Wynn said at the time.
Both Soriano and Genuino are the targets of a corruption
case brought by the Aquino administration in 2011. PAGCOR said
on Monday that the report of payments to Soriano would
"strengthen its plunder case" against the two men.
Soriano and Genuino could not be reached for comment.
On Friday, one of the U.S. law firms representing Okada
withdrew from the lawsuit against Wynn.
Paul Spagnoletti, an attorney with the New York offices of
Davis, Polk, Wardwell LLP, said his firm had stopped
representing the Japanese businessman. Spagnoletti would not
cite a reason for the sudden withdrawal.