Emperor casino closure tied to graft crackdown


Zach Coleman


January 20, 2005


The mainland's crackdown on gambling has touched tycoon Albert Yeung's North Korean casino, which has halted operations indefinitely.

The closure comes a month after mainland corruption investigators disclosed that an official from the border town of Yanbian gambled away almost three million yuan (HK$2.83 million) in public money at Yeung's Emperor Casino in a special economic zone.

The discovery, on the heels of a string of a similar cases of officials using public funds at Macau casinos, put some 200 border casinos in the crosshairs of a national police anti-gambling campaign unveiled last week.

Mainland officials have yet to confirm whether Macau's booming casino business will be targeted in the drive to keep mainlanders away from gambling parlors.

State media reports Wednesday tied the closure to warnings issued by Yanbian officials to travel agencies and tour guides to halt gambling tours or face the loss of their licenses.

However, Emperor Group spokeswoman Christina Ng said the casino was closed for renovation.

``Since it is winter in North Korea, the flow of customers is relatively low,'' she wrote in an e-mail reply.

Ng said by telephone that she could not predict when the casino might reopen. She said that the Emperor Hotel and its facilities continue to operate normally.

State media said mainland officials restricted the issuance of border crossing permits and began strictly enforcing limits on the amount of cash taken out after the corruption case came to light last month.

Yeung elevated himself to the top ranks of foreign investors in North Korea with his HK$1.4 billion investment in the Emperor Hotel & Casino, which opened in Rason town in 1999.

Recent press reports suggested that Yeung might inject the project into Emperor Entertainment Hotel, a Hong Kong-listed company he controls that is in the process of absorbing his stakes in a planned Macau casino hotel and a Hong Kong-based gambling cruise ship.

Only last week, a report on mainland state television network CCTV quoted a source as suggesting that the casino might escape the new gambling crackdown because of Yeung's cultivation of ties with top officials in Beijing.

Two casinos usually patronized by mainlanders in the nearby Russian port of Vladivostok have also closed recently, according to a report on Wednesday by Global Times, a magazine published by the People's Daily. The report said at least four other casinos in the city were suffering from a loss of mainland business due to the crackdown.

In total, state media reports say that between 68 and 84 casinos have closed in Burma, Laos and Vietnam since Yunnan provincial police launched a preliminary campaign last month targeting border gaming parlors by detaining Chinese managers, cutting off utility connections from China, shutting down customer reception centers and restricting border crossings.

But the campaign is reportedly running into some difficulty targeting casinos across the border in Vietnam because most are operated as joint ventures with the country's government agencies.

But the Global Times reported the US$50 million (HK$390 million) Li Lai International casino hotel in the town of Mong Cai has lost business due to the crackdown. Its general manager refused to comment.

The resort, which Vietnamese press reports say is part-owned by a Hong Kong company, generated 800 million yuan in profit between 2002 and last year, according to a Xinhua News Agency report last year.

Underscoring the reversal of official attitudes toward border casinos, a Guangxi government Web site on Wednesday still displayed a staff-recruitment listing posted last year by Li Lai while a tourism bureau page about tours to the casino had been removed. Other official Guangxi tourism sites still carry information about the part Stanley Ho-owned Do Son Casino.

zach.coleman@globalchina.com

 


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