Bloomberg Businessweek|February 15, 2018|A Chinese Casino Has Conquered a Piece of America

by Matthew Campbell

Dr. Marty Rohringer was ending a graveyard shift at the lone hospital on Saipan, the exceptionally remote U.S. island, when four Chinese men arrived with a body.

The figure they had with them—a middle-aged man, also Chinese, naked but for his underwear—was unresponsive, and had clearly suffered severe trauma. As an orderly lifted him onto a gurney, the four men indicated in broken English that he had fallen from a hotel-room balcony.

Rohringer began to evaluate the man under the ER’s harsh fluorescent lights. His skin was pallid and turning blue, and it was obvious that he could not be revived. One of the men who’d arrived with the body started to mime chest compressions: Was there really nothing to be done? Rohringer pronounced the man dead just before 8 a.m. on March 22, 2017. Already, the medical staff suspected that the story of his fall was a lie.

The hospital had been inundated with patients from a construction site a few blocks away on this speck of rock among the Northern Mariana Islands, in the deepest part of the Pacific. To get a sense of Saipan’s isolation from the Lower 48, imagine flying from Denver to Honolulu. Then fly that far again. Then go farther still. Saipan (population 48,000) is nevertheless American soil, with U.S. dollars, U.S. mail, and U.S. laws. But the place has seemed less and less like America since 2014, when a Chinese casino operator arrived and—with near-total impunity—turned Saipan into a back door to the U.S. financial system.

At a temporary storefront, the company, Imperial Pacific International Holdings Ltd., was somehow handling more than $2 billion a month in VIP bets. And at the construction site, it was building a gargantuan casino with a crew of hundreds of Chinese, scores of them working illegally on tourist visas. So many laborers were getting hurt that Rohringer’s colleagues began keeping an unofficial spreadsheet, separate from standard hospital records: a grim catalog of broken bones, lacerations, puncture wounds, dislocated limbs, and eyes penetrated by flying metal. The dead man Rohringer saw was not, of course, a tourist who’d stumbled over a railing—he was a builder named Hu Yuanyou, and he’d plummeted from a scaffold. His colleagues hadn’t called 911; instead, they’d pulled the work clothes off his broken body in a clumsy attempt to obscure his identity. The less that outsiders learned about the casino, the better.

Hu died building what’s become, on paper, the most successful gambling operation in history. In the first half of 2017, table for table, Imperial Pacific turned over nearly six times more cash than the fanciest gaming facilities in Macau, which themselves dwarf the activity in Las Vegas. And that was before Imperial Pacific opened its lavish megacasino in July.

Imperial Pacific also hired Shen Yan, a Chinese banker who’d held senior positions at Deutsche Bank and Credit Suisse, as president. Yan had suffered an alarming career setback in 2011—he was arrested at Hong Kong International Airport for carrying a gun in his backpack—but he had connections, including to David Paterson, the blind former governor of New York, whom Yan had once helped navigate a menu at a Shanghai luncheon. In 2015, Yan persuaded Paterson to join an Imperial Pacific advisory board and make introductions to other political figures.

Paterson delivered, demonstrating just how easy it is to get prominent American government figures to work for an opaque, year-old Chinese casino developer. He quickly got in touch with Ed Rendell, the ex-governor of Pennsylvania. “They wanted some Americans involved in case anything came up with the regulation or legalities,” Rendell told Bloomberg in a 2016 interview. “One of my assistants and I did some research on the internet.” He signed on for $5,000 a month and persuaded Haley Barbour, the former Mississippi governor, to take the same gig. Louis Freeh, the former FBI director, also became an adviser. Eugene Sullivan, a retired military judge [note: Sullivan is Freeh’s partner in Freeh Sporkin & Sullivan], and James Woolsey, the former CIA director, joined Imperial Pacific’s board of directors.

(Barbour resigned on Feb. 8 in response to questions for this article. Paterson and Rendell, who stepped down earlier, told me they had no knowledge of improper activities by the company. Freeh, who is no longer on the advisory board, and Sullivan, who last year reduced his role from director to adviser, didn’t respond to requests for comment. Brown, who left in December, declined to comment. Woolsey told me: “I have not been made aware of any issues of safety or improper relationships with politicians. If impropriety is proven, I will not be comfortable staying on the board.”)

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