By Farah Master and Sue Zeidler
The Macau government has launched an official investigation into Sands China, owned by billionaire Sheldon Adelson, after the company transferred documents linked to a wrongful dismissal case to the United States from Macau.
It is the latest twist in a saga that has become a firestorm for the casino mogul, who owns casinos in Las Vegas, Macau, and Singapore, and is the most active donor in U.S. Republican candidate Mitt Romney's presidential campaign.
Adelson is already due to face an Aug. 30 hearing in the United States, where District Court judge Elizabeth Gonzales will decide whether Las Vegas Sands Corp withheld financial documents in a case in which the 78-year-old is accused of having personally approved of prostitution at the company's casino in China's special administrative region of Macau.
Sands, the biggest casino operator in Macau by market value, announced the Macau investigation on Wednesday in a voluntary notice. It did not provide further comment on the probe.
The closely watched case began in October 2010 as a wrongful termination suit filed by Steven Jacobs, who was fired in July 2010 from his job as chief executive officer of Sands China Ltd, Sands' Macau subsidiary.
Jacobs claims in court documents that he was wrongfully dismissed after clashing with Adelson over what Jacobs alleged was improper and illegal conduct, including allowing prostitution, and hiding the use of unauthorised construction workers for the Sands China casino.
His suit triggered a federal investigation by the U.S. Securities and Exchange Commission into its Macau operations.
Sands lawyers acknowledged to Judge Gonzales in June that they were in possession of documents from Jacobs' computer hard drive, after having previously said that the information could not be produced without violating Macau data protection laws.
Last week, the non-profit investigative journalism organisation ProPublica reported that Sands had transferred these documents to the United States from Macau citing a court filing and a deposition of Sands Assistant General Counsel Michael Kostrinsky.
Sands lawyers now say, according to a filing, that the documents were transported "in error" on a hard disk to the casino's deputy general counsel in the U.S. in November 2010 without notifying Macau authorities.
The charges cast a harsh light on Adelson, the largest individual donor to U.S. Republican candidates in 2012 campaigns. Adelson and his wife Marion recently gave $10 million to the Restore Our Future, a super PAC to support Romney's presidential bid.
On July 30, Adelson also accompanied Romney on a foreign policy and fundraising trip to Israel.
The company has adamantly denied all the charges made by Jacobs. "These questions will be answered in due course in the most appropriate forum - namely the courtroom," said Sands spokesman Ron Reese.
In March 2011, Las Vegas Sands also said it was being investigated by U.S. authorities for potential breaches of the Foreign Corrupt Practices Act, which prohibits bribes to foreign officials by U.S. companies.
Shares in Sands China fell 3 percent after the market opened in Hong Kong on Wednesday.
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