Japanese billionaire Kazuo Okada, owner of hotels and casinos business Universal Entertainment and one of the biggest stakeholders in Japan’s infamous pachinko industry, will be facing charges in the Philippines over the creation of alleged dummy corporations to facilitate approvals for a multi-billion dollar casino project in the Manila Bay area.
The issue stems from an ambitious project by the Philippine Amusement and Gaming Corp that includes reclaiming parts of Manila Bay to build a multi-casino complex meant to put the Philippines in the Asian gambling map. Okada’s Universal Entertainment was one of the 4 outfits that received approvals and licenses under former Philippine gaming chief Ephraim Genuino to operate casino-entertainment projects. Okada’s group had already planned a US$2 billion Manila Bay Resorts project within the area, but a slight constitutional issue must be dealt with. The Philippine Constitution prohibits foreigners from owning land in the country, or even owning over 40% in an entity that owns a land. The law also prohibits foreigners from intervening in the management, operation, administration, or control of any nationalized activity.
The Philippine Department of Justice set out to investigate the issue and found that Universal Entertainment allegedly worked with two law firms in Manila to establish 3 dummy companies so that their project might be approved. “It can be concluded that right from the beginning, Universal [was] behind the operations of the 3 corporations…The synthesis of the different components of these corporations had clearly established that the resources which fueled the operations of the corporations under investigation actually came from Universal,” the investigation revealed. It was these 3 entities that then dealt with the Philippine gaming authority to secure the licenses to develop the casino projects.
Okada has been investigated by the American Federal Bureau of Investigation on multiple incidents. As Universal Entertainment was also subject to a bribery probe that happened in the United States, whose beneficiaries allegedly were Philippine government officials, American investigators were able to get information specifically from local law firm M. M. Lazaro and Associates. The law firm told the American investigators that “Mr. Okada caused various legal entities to be incorporated in the Philippines, in order to develop his casino resort project there, over time replacing the original incorporating Filipino shareholders with combinations of foreign shareholders affiliated with or controlled by him and associates of then-Pagcor chairman Genuino.”