A team of Maryland gambling regulators and law-enforcement officers spent several days in China last week as part of an ongoing investigation into the suitability of MGM Resorts to operate a casino in Prince George’s County, according to a person familiar with the trip.
MGM, one of three companies vying for the Prince George’s license, operates a casino in Macau, the world’s top gambling market, that has drawn the attention of regulators in several other states, prompting varying degrees of concern. The casino is partly owned by Hong Kong businesswoman Pansy Ho, whose father, casino magnate Stanley Ho, has been alleged to have ties to organized crime.
MGM officials said last year that they fully expected Maryland regulators to examine the company’s relationship with Pansy Ho but said they were confident the review would not derail MGM’s efforts to build and operate an $800 million “luxury resort” at National Harbor, the 300-acre mini-city on the banks of the Potomac River.
“We are confident that we can address any questions that may be raised by [Maryland] regulators and look forward to that opportunity,” MGM spokesman Gordon Absher said when asked about the issue a year ago, as MGM was pushing the legislature to authorize a new casino site in Prince George’s.
Absher, who could not immediately be reached for comment on Monday, also emphasized that Pansy Ho has operated independently of her father and owns a minority share of the MGM Grand Macau.
The Maryland team that traveled to Macau included officials from the Maryland State Lottery & Gaming Control Agency, the Maryland State Police and the Maryland Attorney General’s Office, according to the person familiar with the trip, who requested anonymity to more freely discuss an ongoing background investigation.
Members of the same state agencies are also looking into the backgrounds of Penn National Gaming, which has proposed a $700 million Hollywood Casino Resort at Rosecroft Raceway; and the owner of a Pennsylvania casino, which has proposed an $800 million Parx Casino Hotel & Spa nearby in Fort Washington.
Under state law, the background checks are supposed to assess both the financial capabilities of potential casino owners, as well as their integrity. Similar checks have been conducted on owners of Maryland’s other casinos.
Once the current round of background checks are complete, a state commission is expected to weigh the three proposals for Prince George’s and pick a winner by early next year. The commission is planning visits to all three proposed sites as early as this fall.
The casino, which would be Maryland’s sixth, could open as early as mid-2016, under state law.
The relationship between MGM and Pansy Ho prompted serious enough concerns in New Jersey in 2010 that MGM agreed to sell its interest in the Borgata Hotel Casino and Spa in Atlantic City rather than sever its relationship with Pansy Ho in Macau.
More recently, MGM has asked New Jersey officials to reconsider their position.
Officials in several other states that have looked at the relationship, including Nevada, where MGM has several properties, have allowed the company to continue operating.
A 74-page report released in New Jersey in 2010 included allegations of use of VIP rooms in casinos owned by Stanley Ho by crime groups known as triads to engage in activities including debt collection, drugs and prostitution.
Stanley Ho is not listed as an owner of the MGM Grand Macau, and none of the alleged crime in the report was said to have occurred in that casino.
More broadly, members of a congressional advisory panel testified in Washington last month that gambling regulators in the United States should step up their scrutiny of casino companies operating in Macau because of concerns about money laundering and other illegal activities.
A large share of the gambling revenue in Macau comes through trips arranged by so-called “junket operators” who serve visitors to Macau from mainland Chian and elsewhere.
The person familiar with the trip in Maryland said that besides visiting MGM’s property in Macau, members of the team spoke last week with various “junket operators.”
The cost of background checks in Maryland are borne by the potential casino operators, according to state officials.