State gambling investigators have recommended that Wynn Resorts be deemed suitable to operate a casino in Everett, concluding the last in a series of intensive background checks on casino applicants that sent Massachusetts investigators around the world.
The recommendation came with the condition that Wynn Resorts publicly explain its business practices in Macau, China, during a hearing Monday before the five-member state gambling commission.
“The issue is: Do we allow illegal activity in our casinos?” Wynn Resorts chairman Steve Wynn told the commission. “The answer is no.” He pounded the table. “No.”
The investigators’ recommendation is not binding on commissioners, who are expected to issue a final decision within seven to 10 days on whether the company is suitable to hold a gambling license.
Based on the commissioners’ comments Monday, Wynn’s chances seem strong: Chairman Stephen Crosby told Wynn it appears “your compliance process works well.”
Wynn, represented at the hearing by former Massachusetts governor William F. Weld, told reporters he was confident that his company would be deemed suitable to operate in Massachusetts.
“There isn’t anything newsy, or you would have heard it,” Wynn said during a break in the hearing. “The fact they didn’t raise issues is not because they didn’t go looking.”
The commission dealt with the most serious portion of Wynn’s background check Friday, in a separate hearing to review concerns from investigators that a Revere felon, Charles A. Lightbody, may have an undisclosed stake in the former industrial land in Everett where Wynn wants to build a $1.3 billion gambling resort.
Investigators found that Lightbody has repeatedly bragged about his plans to conceal a stake in the property, according to transcripts of prison phone recordings released Friday. The recordings were made during Lightbody’s conversations with Darin Bufalino, an organized crime figure serving a state prison sentence.
The commission voted 4 to 0 Friday to approve a plan by Wynn to slash the price he would pay for the land to market rate, based on an extensive appraisal.
Under this plan, no undisclosed partner would benefit from a premium price by selling the property to a wealthy casino company, rather than to any other kind of developer.
Crosby recused himself from the land review Friday, due to his former business association with one of the owners of the Everett site, Paul Lohnes.
Crosby participated in Monday’s hearing on the remainder of the background report.
Another gambling company, Caesars Entertainment, sued Crosby last week, accusing him of discriminating against Caesars. Caesars was a partner in a Suffolk Downs casino plan, a rival to Wynn for the Greater Boston license, until the commission’s staff released an unflattering background report on Caesars. Suffolk Downs immediately dropped the company from the venture.
Wynn, who has been critical of the commission in the past, defended Crosby.
“His background is unimpeachable,” Wynn told reporters. “I think Caesars — I can’t speak for them — but obviously they’re stung by . . . the negative fallout of this and probably trying to recover from it, one way or another.”
Wynn is the second international casino operator to appear before the commission in a week. On Dec. 9, commission investigators said MGM Resorts, like Wynn, should be forced to publicly explain and defend its business practices in Macau, the most lucrative gambling market in the world.
Massachusetts investigators have raised concerns about the common use in Macau of “gaming promoters” who recruit customers for casinos and extend credit to players.
“Under these procedures, Wynn Macau is unaware of the manner in which credit is extended to, and debts collected from, Wynn Macau’s own customers that game in the gaming promoter rooms,” investigators wrote in their report on Wynn. “Under this system, Wynn Macau has no corporate knowledge of what interest rate, if any, is charged or the manner in which debt collection is undertaken in jurisdictions that do not recognize gambling debts as legally enforceable obligations.”
Investigators used similar language in their report on MGM. The commission is expected to decide as soon as this week whether MGM has passed the background check. MGM, which has proposed a Springfield casino, is the only remaining competitor for the Western Massachusetts license.
Wynn attributed the concerns over Macau to “differences in culture between China and America” that take time to understand.
The billionaire developer said he has so far spent $6 million to $8 million on his Massachusetts bid. Wynn recently pulled out of a competition in Philadelphia, but said he remains bullish on prospects in Massachusetts.
“I’m crazy for this place, because it’s a big hotel town and it’s a great international destination,” he said. “If we do a good job here, we can get business from China.”
The other possible applicant for the license is Mohegan Sun, which has proposed a casino on land in Revere belonging to Suffolk Downs. The commission recently agreed to lift a deadline to allow a referendum on the proposal in Revere, probably in February.
Wynn said he has no problem with the commission bending the deadline for a potential rival. “The only way we make any money is running our own business and paying attention to our own shop,” he said. “Whatever the other companies do is irrelevant.”
With his usual swagger, Wynn also advised the commissioners to give the casino license to a certain kind of developer: “You should pick someone who looks like fun to you.”