Venetian Macau sues 2 gamblers over $4.5M in debts
- Article by: KELVIN CHAN
- Associated Press
- January 25, 2013 - 2:34 AM
HONG KONG - U.S. billionaire Sheldon Adelson's flagship Macau casino is suing two mainland Chinese high rollers over debts worth millions in a case that provides a rare glimpse into the VIP culture that powers the gambling enclave.
The Venetian Macau took legal action in a Hong Kong court this week to recover about $4.5 million in the two separate cases.
Macau's rise to world's biggest casino market has been driven by wealthy mainland Chinese gamblers. The lawsuits highlight the difficulties in collecting debts when high rollers return to the mainland, where gambling is illegal and debts aren't recognized by courts. Macau and nearby Hong Kong are semiautonomous Chinese territories with separate legal systems from mainland China.
In a lawsuit filed on Wednesday with Hong Kong's High Court, the Venetian is trying to recover 23.4 billion Hong Kong dollars ($3 million) from Zou Yunyu. Zou once featured on lists of China's richest people with a fortune from her company, the Shanghai Gaoyuan Property Group, that Forbes estimated in 2008 was worth $220 million.
In the second case, filed the same day, the Venetian is pursuing HK$11.3 million ($1.5 million) from Xie Xiaoqing, who Hong Kong media reports said Friday was a businessman and deputy to the provincial legislature in Hubei province.
Most of the so-called VIP business is handled by junket operators, middlemen who arrange for the high-rollers to travel to Macau and gamble in private rooms. The junkets also extend credit to the gamblers, who are restricted by Beijing's capital controls on how much money they can take past the borders. But in Zou and Xie's cases, they had borrowed directly from the casino.
Details from the lawsuits suggest the pair gambled away huge sums of money in a short period of time.
In Zou's case, the Venetian lent her HK$30 million on Sept. 30, 2011, with repayment expected two weeks later and 18 percent interest charged on any outstanding amount after that. Zou managed to chip away at the debt with small repayments, including HK$2 million each in January, February and August last year, before stopping.
Xie borrowed HK$10 million on April 1 last year and then another HK$2 million two days later, with the same repayment terms. He too repaid a small amount, including HK$200,000 in September.
Still, the money owed is a drop in the bucket for Las Vegas Sands, which reported net profit of about $350 million in the third quarter, with more than 90 percent of that coming from Sands China, its Macau unit.
The Venetian is one of four casinos owned by the Chinese arm of Adelson's Las Vegas Sands Corp. in Macau. The former Portuguese colony earned $38 billion in casino revenue in 2012, some 13.5 percent higher than the year before.
Hong Kong Judiciary: http://www.judiciary.gov.hk/en/index/index.htm
Follow Kelvin Chan at twitter.com/chanman
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