30-second summary
- The Nevada Gambling Commission has fined Wynn Resorts a record $20m?
- The fine is punishment for failing to deal with the alleged sexual misconduct of their founder Steve Wynn
- It revolves around numerous alleged incidents involving Wynn from over the years, including one that ended in a $7.5m settlement
Details of this fine
Wynn Resorts is the company founded by Steve Wynn. The Nevada gambling regulator has now hit the company with a record fine of $20m (￡15m).
The fine was levied because of the company’s failure to conduct a proper investigation into claims of alleged sexual misconduct made against Steve Wynn. Shortly after these accusations came to light, Wynn resigned as chairman of the group.
The story first came to light in a Wall Street Journal report that numerous women were alleging that they were subject to assault or harassment from Wynn. The story led to an investigation that has now come to an end with the announcement of this fine.
The company will still hold onto its gambling license following the payment of their fine to the Nevada Gaming Commission. Four commissioners made the decision to hand out such a hefty fine.
One of these commissioners, former federal court judge Phillip Pro, said of the decision: “It’s not about one man. It’s about a failure of a corporate culture to effectively govern itself as it should.”
Record-breaking
The commission is responsible for ensuring that licensees do not bring the industry into disrepute in any way. The fine is much larger than the previous record fine levied by the commission, a $5.5m (￡4.1m) fine given to CG Technology in 2014. CG Technology is a company that provides systems for mobile gambling and sports betting.
There was talk of handing out an even larger fine on Wynn Resorts, but that could have significantly injured the public company.?This settlement did not involve Steve Wynn himself, and none of his representatives were at the hearing of the commission. He denies all of the allegations, and there are ongoing investigations into the matter.
Steve Wynn’s casino license has been frozen, but no other action has yet been taken against him or the executives and board members who were also named as part of the settlement. All of those named no longer have dealings with Wynn Resorts.
Background to the case
While the finer details of the findings of the investigation were not made public, the original story was in the Wall Street Journal. It revolved mainly around the settlement of $7.5m (￡5.6m) that Wynn paid in 2005 to a woman who alleged that she was raped by the casino mogul, leading to a pregnancy.
Another allegation concerned incidents that were said to have taken place between 2005 and 2006 in which a woman alleged she was pressured into a non-consensual sexual relationship with Wynn. This led to a private settlement of $975,000 (￡733,000).
There was also mention of alleged sexual harassment incidents involving flight attendants during company flights. These incidents were not investigated by the company.
Since these incidents have been made public, there have been significant internal changes in Wynn Resorts. A new chief executive is in charge and all workers are now required to undergo sexual harassment prevention. There is also a new leadership council for women that aims to promote equality in the company.
Massachusetts problems
The case created additional complications for Wynn Resorts. The company received one of three casino licenses in Massachusetts and was developing a new resort casino there when the allegations came to light.
That led to an investigation being started by the Massachusetts Gaming Commission. The commission was not made aware of the settlement payments were made by Wynn during the disclosure process when applying for a license. Therefore, the company is in danger of losing this license.
Wynn Resorts has already taken Steve Wynn’s name off the Massachusetts project and the license. It was originally to be called the Wynn Boston Harbor Casino, but that has been changed to the Encore Boston Harbor Casino.
The investigation came to a close in January and findings have not yet been made public. The commission is waiting for the conclusion of a lawsuit involving the commission and Steve Wynn. Once this happens, there will be a review and a public hearing on the matter.