Massachusetts gaming regulators on Tuesday fined Wynn Resorts Ltd $35 million for not disclosing sexual misconduct allegations against founder and former CEO Steve Wynn but allowed the casino operator to keep the license for its new $2.6 billion casino near Boston due to open in June.
The commission also fined current CEO Matthew Maddox $500,000 for his “clear failure” to investigate at least one misconduct complaint and required the Nevada company, which also owns properties in Las Vegas and Macau, to be subject to review by an independent firm selected by the state.
The commission, in its 54-page decision, said it was 'troubled by the systemic failures and pervasive culture of non-disclosure' its investigators uncovered, but ultimately determined the evidence 'does not rise to the level' of revoking the company's license or calling for other major changes.
According to the decision, the Commission identified “numerous violations of controlling statutes and regulations largely pertaining to a pervasive failure to properly investigate in accordance with existing policies and procedures, and to notify the Commission about certain allegations of wrongdoing.”
“Specifically, the corporate culture of the founder-led organization led to disparate treatment of the CEO in ways that left the most vulnerable at grave risk. While the Company has made great strides in altering that system, this Commission remains concerned by the past failures and deficiencies,” read the commissioners’ decision.
The commission found that Wynn Resorts violated at least five regulations and several of its own company policies meant to protect employees from inappropriate behavior. Throughout the report, commissioners state they were “troubled” and “disturbed” about the findings, but that there was not enough evidence to show that Wynn Resorts willfully misled regulators.
Wynn Resorts spokesman Michael Weaver said in a statement that the company received a copy of the decision late Tuesday. “We are in the process of reviewing that decision and considering the full range of our next steps,” he said. “We will not have further comment until we have thoroughly reviewed and considered the MGC’s decision.”
Nevada regulators, after an investigation similar to Massachusetts' earlier this year, levied a $20 million fine on the company but also allowed it to retain its casino license.
Regulators in both states were focused on how long company officials were aware of the allegations and how they responded, rather than the truth behind the claims.