Welcome to the Wynn Resorts Conference Call. I will now turn the call over to Mr. Matt Maddox.
Thank you. Good morning, everyone. Before we get started, I just need to remind everybody that we will be making forward-looking statements on this call, and those statements may or may not come true. I'm going to turn it over to Steve to introduce the call.
Good morning. I think this is an unusual phone call occasioned by the incidents that took place this weekend when we had a forward meeting. It concerns the shareholder of the company and the director, Aruze USA, Universal , the parent company in Japan, and our director, Kazuo Okada. This matter was brought to the attention of the board and brought to the vote of the board because of the actions of the Compliance Committee chaired by Governor Robert Miller. I'm going to introduce Governor Miller, but I would like to remind the people on the call that, besides the other distinguished members of the board of Wynn Resorts, Governor Miller himself is probably the most qualified Chairman of a Compliance Committee for a Nevada corporation of all the humans that we could have found in the world. This gentleman probably is the most qualified.
He was a Justice of the Peace. He was a District Attorney. He was the Chairman of the National District Attorneys Association. As Lieutenant Governor, he fulfilled the last two years of the Governor's term of former Senator Bryan, and then received two full terms of a year of four years apiece for a total of 10 years as the longest sitting Governor in Nevada history. I don't think any citizen in the history of our state has had more qualifications, more training, and more judgment of perspective on issues of compliance and law enforcement than Governor Miller. It is therefore my pleasure to turn the meeting and the discussion over to Governor Miller.
Thank you, and good morning to everybody. I'm certain that all of you would like to just skip to the bottom line, but please allow me a few minutes to go through the deliberate and lengthy process that led up to the decision on Saturday because I think the what and the whens are relative in consideration of the why. This began well over a year ago. In fact, in early to mid-July of the year 2010, the company did an internal investigation for the Compliance Committee relative to the concept of considering business in the Philippines, and that was pursuant to our belief that Mr. Okada, a shareholder and board member, had approached Mr. Wynn to suggest the concept of doing business in the Philippines.
The reason it came to the Compliance Committee is because the Compliance Committee, under Nevada regulations, has the responsibility of considering anything that might have bearing upon our privileged license. Since this company has a privileged license, the Compliance Committee is structured under Nevada regulatory authority to self-report anything that might be of interest to them in their ongoing consideration as to the license that we hold, the people that we deal with, or anything that might raise questions in their mind. That report raised some questions about whether or not this company should do business in the Philippines. Subsequent thereto, because there were ongoing conversations by Mr. Okada suggesting he was considering doing business in the Philippines, additional reports occurred.
In February of the year 2011, in other words, approximately a year ago, one group that was hired to do some follow-up assessment of the risk of doing business in the Philippines uncovered some questions relative to Aruze Universal and Mr. Okada. Those questions related to associations of Mr. Okada and his company in the Philippines. They related to questions revolving around the usage of some rights provided by those companies to the Philippine government, which were controlled by PAGCOR, the regulatory authority. At least a portion of them were controlled by PAGCOR. Subsequently, some of that rights was diverted for the use of the then Chairman of PAGCOR's sons in their political elections.
The license given to Mr. Okada and his company in May of 2010 was characterized by the Filipino press as the midnight deal, and it was granted by the individual whose sons benefited from the utilization of the rights. I'm not suggesting that there was a direct connection or knowledge by Mr. Okada or Aruze at this point in time, but certainly, as you might expect, with us being a committee assigned the task of investigating whether there was anything that needed to be reported to the appropriate authorities, it raised some concerns and raised some eyebrows in our mind. On February 24, 2011, just short of a year ago, the board of directors, on which all members were present, including Mr. Okada, discussed Universal's commitment in the Philippines. We discussed some of these facts. We then advised that the company should not do business in the Philippines.
This was, of course, disputed by Mr. Okada, but it was all the other board members suggesting it. We advised Mr. Wynn that it was extremely unlikely that this board of directors would have ever approved doing business in the Philippines and suggested to him that he cancel this meeting that had been scheduled with Philippine President Aquino at the request of Mr. Okada, which he did. In the ensuing months, there was another board meeting on July 28, 2011. At that time, there was a further discussion by the board of Mr. Okada's continued involvement in the Philippines. At a meeting of the independent directors, we expressed concern to Mr. Wynn and our General Counsel, Ms. Sinatra, regarding possible probity issues attendant to Mr. Okada and that his involvement in the Philippines might have an adverse effect on Wynn Resorts.
We certainly had taken into consideration and account some publications and some documentation from Aruze and Universal's own websites in which there was implicit and sometimes explicit representations that Wynn Resorts was involved in the deal that Mr. Okada and his company were only solely involved in. Those were misrepresentations, and that was one of the considerations that brought it to our attention. At that time, in August, we decided that there needed to be further follow-up on the Foreign Corrupt Practices Act and brought in an outside expert to inform all board members of the parameters of the Foreign Corrupt Practices Act. All board members, except Mr. Okada, attended that meeting. We also have a code of conduct, which outlines the requirements of being a member of the board and what is suitable and responsible activities on board members.
All members of the board, except Mr. Okada, have signed that. A further investigation indicated that in August of 2011, questions arose as to the land which Mr. Okada and his companies had purchased in the Philippines for the purpose of opening the casino. The questions revolved around the individual that had sold the land to Mr. Okada, his potential associations with government officials in the Philippines, the fact that he was subsequently indicted specifically related to that sale, but not on the basis of income tax evasion for understating the value of the money that he received, not to suggest that there was any definitive evidence of collusion, except that it raised another specter of concern. Additionally, Mr. Genuino, the former Chairman of the PAGCOR Gaming Regulatory Authority, was charged with conduct that resulted in criminal conduct in the Philippines as well.
In September, September 27, 2011, the Compliance Committee met again. We discussed the actions of Universal and the casino concession, the indictment of those PAGCOR officials, and the investigation of the seller of the land that I outlined just a minute ago. At that time, we had indicated to the Board and to Mr. Okada the process that had evolved to date. He reacted in a very negative manner in the boardroom, and as was included in the report, the ultimate report by Judge Freeh, which I'll outline more of in a minute, Mr. Okada is listed as saying in that report to several of the Board members' recollection that in the Asian market, it is customary to provide gifts to government officials, and that you don't do it directly; you do it through intermediaries.
This was in the course of our discussion with him about the Foreign Corrupt Practices Act , and it was frankly a shock, as expressed by many of the Board members, to hear someone suggest that that would be acceptable or even legal behavior. Pursuant thereto, at the end of September 2011, and in compliance with the instructions of the Compliance Committee, General Counsel Ms. Sinatra and the Compliance Officer Mr. Torick met with Mr. Okada's attorneys to discuss concerns the Committee had relative to his involvement in the Philippines and its effect on his ability to remain a member of this Board of Directors. Therefore, Mr. Okada, through his attorneys a full year ago, had direct knowledge of some of the facts that were outlined. Some of the facts that I've just related to you were brought directly to the attention of his attorney.
A full year ago, he was aware of the earliest substantive components of our concerns about him doing business and his actions in the Philippines potentially adversely affecting Wynn Resorts. Subsequent thereto, he had declined to withdraw from the Philippines or to withdraw from his involvement with Wynn Resorts, not recognizing any potential for conflict. Because of the serious nature of the materials that we had received, and the fact that we felt that it was important to have a complete investigation, the Compliance Committee, in the beginning of November 2011, hired Judge Louis Freeh and his firm. Judge Freeh is the former Director of the Federal Bureau of Investigation. They conducted several interviews and an investigation up until last weekend. It should be noted that Mr. Okada strongly objected to the concept of hiring Judge Freeh to look into these matters of concern to us.
Judge Freeh made repeated efforts to interview Mr. Okada; however, he would not initially make himself available. Finally, we gave Mr. Okada a deadline, saying that we were tired of waiting for time to interview him. The deadline was February 1st. At the request of his attorneys, when they suggested that he would make himself available on February 15th, we agreed that we would allow that to occur before a final report was completed. According to Judge Freeh's report, he spoke to Mr. Okada for seven and a half hours in the presence of Mr. Okada's attorney. Following the interview, he informed Mr. Okada that he would be finalizing the report on Friday, February 17th, and offered him an opportunity to present any exculpatory evidence prior to that time frame.
He determined that no additional exculpatory evidence was presented, and thus a final report was presented to the committee and ultimately to the board on Saturday, February 18th. According to the report, and I will quote portions thereof, "First, Mr. Okada and his associates and companies appear to have engaged in a pattern of prima facie violations of the Foreign Corrupt Practices Act. Second, the prima facie Foreign Corrupt Practices Act violations by Mr. Okada and his associates and companies constitute a substantial ongoing risk to Wynn Resorts and to its board of directors, creating regulatory risk, conflicts of interest, and potential violations of his fiduciary duty to Wynn Resorts. Finally, Mr. Okada's documented refusal to receive Wynn Resorts requisite FCPA training provided to other directors, as well as his failure to sign an acknowledgment of understanding of Wynn Resorts' code of conduct, increases this risk going forward.
Third, the report says, "Despite being advised by the Wynn Resorts board of directors and Wynn Resorts attorneys on the strict U.S. anti-bribery laws which govern Wynn Resorts and its board, Mr. Okada strongly believes and asserts that when doing business in Asia, he should be able to provide gifts and things of value to foreign government officials, whether directly or by the use of third-party intermediaries or consultants." Fourth, Mr. Okada and his associates and companies appear to have engaged in a longstanding practice of making payments and gifts to his two chief gaming regulators at the Philippine Amusement and Gaming Corporation, PAGCOR, who directly oversee and regulate Mr. Okada's provisional licensing agreement to operate in that country.
Five, Mr. Okada and his associates and companies have arranged and designed his corporate gaming business and operations in the Philippines in a manner which appears to contravene Philippine constitutional provisions and statutes that require 60% ownership of Philippine nationals as well as Philippine criminal statute. I might add, by the way, that in trying to ascertain whether the appropriate filings had been rendered to the Philippine government relative to this land and these provisions I just mentioned, access to Mr. Freeh was denied, and that denial was signed by a Filipino government official who was one of the individuals that there is evidence indicating whose expenses were paid for in the Wynn Macau visit by Mr. Okada and his companies.
Six, Mr. Okada has stated that Universal paid—this is Mr. Okada's own statement—that Universal, his company, paid the expenses or a portion thereof related to the then PAGCOR Chairman Genuino's trip to Beijing during the 2008 Olympics. I repeat, those are his own words to Judge Freeh. After this hearing, Judge Freeh, the board, after hearing Judge Freeh's report, the board consulted with two prominent gaming law firms here in the state of Nevada. Each firm recommended that, based upon the report, the board had substantial ground to find Mr. Okada, Universal, and Aruze unsuitable. I would point out that prior to that occurring, the Compliance Committee exercised its function in determining that there were sufficient concerns, that this information should be presented to the appropriate regulatory authorities in Nevada and in Macau, where our licenses are held, and to other governmental officials that oversee the Foreign Corrupt Practices Act.
That's the full extent. Third, that we would provide the report to the Board of Directors so that they could determine, as a board, the question of unsuitability and what actions to take if unsuitability was determined. That's a board function, not a function of the Compliance Committee. The board was then provided a copy of Mr. Freeh's report. After receiving it, reading it, and then receiving the advice of the two Nevada legal expert firms, unanimously concluded that Mr. Okada, Universal, and Aruze were, in fact, unsuitable and posing an ongoing risk to the company, Wynn Resorts, its shareholders, and to our reputation in general.
I think it's important for me to give you a little background on the provisions of the company's articles of incorporation, which have been in place since 2002, because they define unsuitability as follows, and I'll quote, "An unsuitable person shall mean a person who, in the sole discretion of the Board of Directors of the corporation, is deemed likely to jeopardize the corporation's or any affiliated company's application for receipt of approval for, right to the use of, or entitlement to any gaming license." It's not just existent licenses, it's prospective licenses. The board, based on the Freeh report then, and after consulting with these experts, found that he met this standard and that his companies did as well.
Having thus found Mr. Okada, Universal, and Aruze unsuitable, the board was under an obligation to take action to protect the corporation, specifically under Nevada sections or under sections 5.040 and 5.045 of the Nevada gaming regulations, which clearly establish the obligation of licensing to self-police. It was a recommendation of both gaming counsel that it was not sufficient for the board to simply turn the matter over to Nevada regulators. Nevada law also requires the company to use all available tools to avoid any association with an unsuitable person. We have such tools in our articles of incorporation.
Specifically, it says that after you determine the person to be unsuitable, or in this case, an entity because this stock is owned by Aruze, they shall be subject to redemption out of funds legally available by action of the Board of Directors to the extent either required by the gaming authority making a determination or to the extent deemed necessary or advisable by the Board of Directors. The advice of the gaming experts was that we would be scrutinized based upon our decision or indecision as to taking action. Since we have the tools to take action, our license would be put under a cloud if we were to not take action, waiting for someone else to do so. It could potentially jeopardize not only our existing licenses but clearly could be utilized as a sign, or on our unsuitability for prospective licenses in any other jurisdiction.
It was the recommendation that we must avail ourselves of these tools and mitigate the risk to the company's current and future licenses. The terms for redemption are outlined, and I'm going to turn to Matt Maddox, the CFO of the company, to outline the process of redemption once that determination has been made.
Thank you, Governor Miller. The redemption process is clearly outlined in the articles of incorporation, which, as Governor Miller stated, have been often made since the inception. Following the finding of unsuitability, the articles provide for redemption at fair value of the securities to be redeemed. The company engaged an independent financial advisor, Moelis & Company, to assist in the fair value calculation.
The company and the Board of Directors concluded that a discount of approximately 30% to the current trading price was appropriate because of various restrictions on most of the shares under the terms of an existing stockholder agreement. The articles state that the redemption price may be paid in cash, by promissory note, or a combination of both. However, if it is a promissory note, the articles require a note with a term up to 10 years, paying interest at 2% per annum. Accordingly, the company has issued a 10-year, $1.9 billion promissory note in consideration for the redeemed shares. To be clear, the company has lawfully executed redemption at fair value, and the 24.5 million shares are no longer outstanding. The accounting impact is quite simple.
It's the impact on the balance sheet as it follows: long-term debt increases by $1.9 billion, and that is at the Wynn Resorts level, and shareholder equity will be reduced by that same amount. With that, I'll turn it back over to you, Governor.
Just before I open it to questions, I would like to also clarify, one of the reasons I gave you a timeline of all this is to show you knowledge of Mr. Okada. I think to put in perspective, there have been previous stories which attribute to Mr. Okada the decision to file litigation relative to records of this company and specifically, an SEC request relative to the decision of the company to provide a donation to the University of Macau. If you listen to the timeline carefully, you would be able to ascertain that when these actions were initiated by Mr. Okada, it was long after he was personally aware of this ongoing investigation and the serious nature in which this company was approaching it. As it relates to the gift to Macau, that was vetted in advance by outside experts relative to the Foreign Corrupt Practices Act.
At the time the board considered this matter, Mr. Okada was present. He did not object or raise any objections to the concept of giving money to the University of Macau. His objections and concerns were the fact that it was over a 10-year period. He suggested it be over a 5-year period. In fact, when the money was, or when the announcement was made and the initial donation was delivered, at his request, Mr. Okada was personally present, and at his insistence, he was included in the photographs handing over the money. This company maintains a very high standard as it relates to compliance with the laws and the regulations upon which our licenses are granted. We take very seriously any person or entity associated with our organization that could be guilty, or could create serious harm to continue our operation and business.
Based on the evidence, we took the steps that were necessary to protect the company, the company's employees, and its shareholders, and we are going to continue to run our business in compliance with the code of conduct and the laws of the jurisdictions in which we operate. At this time, I would ask the operator to open the lines for a few questions, so please restrict your questions to the subject of this call.
At this time, if you would like to ask a question, simply press star, then the number one on your telephone keypad. We will pause for just a moment to compile the Q&A roster. Your first question comes from the line of Joe Greff with JP Morgan.
Good morning, everyone. Thank you for having this call. A few questions here. What law firms were involved? Second question is, when did you disclose these findings or suspicions to relevant third parties, regulators, SEC, Department of Justice, etc.? My final question is, will the Freeh report be disclosed publicly for investors, and if so, when? Thank you.
Hi, Joe. It's Kim Sinatra. As far as law firms, Marc Chen-Lipton from New York has been advising the company on the corporate matters. With respect to gaming law, both Brownstein Hyatt and Gordon & Silver were engaged by the company and the independent directors. With respect to litigation, Bob Shapiro from Glaser Weil, [Vincent Zahn from Gibson Dunn], and I'm going to read up one more litigation firm. You'll see it on the complaint. Gibson Dunn has been the company's outside counsel on FCPA matters led by Deborah Yang in the LA office and Kelly Austin in Hong Kong. John Lane provided some advice to our independent directors through this process. As far as disclosure to regulatory authorities, do you want to handle that, Governor Robert Miller?
The minutes of Compliance Committee meetings are provided to regulators at all times in which they are prepared, and so the gaming regulators in Nevada were aware that there were ongoing concerns and investigations. I believe, but I can't say with certainty, I was told at least that at some point in time after we made it clear to Mr. Okada's attorneys what was going on, their own minutes related in their compliance that they knew that there was an investigation. The Gaming Control Board had made periodic inquiries as to the status of it. Conversations were had with them about the progress, and with their approval, they just said they would wait until we had a completed report from Judge Freeh. That report has been provided to them. Our counsel in Macau has made the gaming authorities in Macau aware of it.
As far as other authorities, since it's been a holiday weekend, we are in the process of ascertaining exactly whom, through the advice of our Foreign Corrupt Practices Act counsel, to provide that information to as well. We suspect that Judge Freeh might have some ideas as to where that should go.
Your last question was the Freeh report.
Was what?
The Freeh report.
As you're, to the Freeh report, as you were aware in earlier releases, civil litigation was initiated by the company, questioning a breach of fiduciary responsibilities by Mr. Okada in his capacity as a board member. Filed with that suit in the Eighth Judicial District Court of the state of Nevada is a copy of the Freeh report.
Thank you, guys.
Your next question comes from the line of Shaun Kelley with Bank of America .
Hi. Good morning, everyone. I'd like to also thank everyone for doing this call so early this morning. A question that I've gotten from a lot of investors is, you know, kind of what's the mechanism of recourse here from, you know, from the other side. Just wondering if legally you could provide any color whatsoever on is it possible for the other side to either try and get an injunction against the actions that have been taken as it relates to the securities that have been issued already and the stock that's been retired? Secondarily, you know, just what, you know, how other regulators might play into that recourse that he might have as well.
Got it. Kim Sinatra. We're not going to engage in a lot of speculation as to what people might do, but I think people should be very clear that the action and the redemption occurred on Saturday. The shares have been canceled, so whatever action would be appropriate would probably not include an injunction because the action has already occurred.
Kim, to clarify, can the valuation as a secondary matter be contested in any fashion? Obviously, it was a fairness opinion that was provided by an outside party, but that's a subjective judgment. Is there an ability to contest that legally?
You can contest most things in the U.S. these days, so no problem with it.
Just lastly, would the jurisdiction be the state of Nevada?
It's a Nevada charter that is being administered by a Nevada corporation. Aruze USA is also a Nevada corporation, so it certainly seems appropriate that Nevada is the jurisdiction for adjudicating these matters.
That's very helpful. One last big-picture strategic question, just the company's thoughts on the impact for future gaming licenses as it might relate to ongoing development in Macau or particularly in Japan as it might relate to these matters. Any thoughts on that from Steve or Matt would be helpful. Thank you.
As I indicated earlier, the advice of Nevada counsel that we exercise all actions we have the lawful authority to do was related to not only our existing licenses and how it would be viewed, but the prospects of our licenses in any other jurisdiction that we might want to pursue further investments and/or other opportunities that occur. I won't speculate on what those can be because all you can. If we were to have waited and not taken action while having the ability to do so, it would cast a cloud over us. We would be in a situation of saying we have declared this company, Aruze, and its, our one board member, Mr. Okada, to be unsuitable, and yet we allowed them to keep stock and stay on the board for an indefinite period of time while having the ability to act.
We chose to act because not only was that the advice of counsel, but that's clearly what's in the best interest of this company and its shareholders.
Thank you very much.
Your next question comes from the line of Carlo Santarelli with Deutsche Bank.
Thank you. Governor, would you be able to outline for us maybe a timeline over the next, call it, several weeks or several months of maybe what we could expect to see, or talk to us a little bit about how you would foresee this process evolving?
You know, I think when Johnny Carson retired, that was the end of anyone's ability to foresee the future. I didn't have that ability even when Johnny Carson was doing The Tonight Show. There's litigation enacted by this company as well as the other litigation that I mentioned that Mr. Okada had initiated previously that's kind of unrelated to these facts. They would, I would assume, respond to that litigation. I've been around the court system long enough to know that it's impossible to predict how long something's going to take for total resolution. I'm sorry. I can't tell you. You'll have to get an expert on, which I'm not qualified to do, to tell you how long it would take to have something resolved in the legal system.
Could I ask then, from your standpoint, is this issue resolved from Wynn Resorts' standpoint?
If you're asking if there's any further action required on the company's part in order to effect this redemption, the answer is no.
Okay. Thank you, Kim.
Your next question comes from the line of Mark Strawn with Morgan Stanley.
Hi. One question. I was curious if the Nevada Gaming Control Board has the right to decide whether Okada is suitable to hold the promissory note, and is there any way they could find him unsuitable to hold that? Would that require you to restructure the way this transaction was structured?
The Nevada gaming authorities have virtually unlimited ability to make any determination they deem fit to any person or entity that has licenses or is subject to the laws and regulations of Nevada gaming. While I can't answer what they will do, they clearly have the ability to review all of the facts that have been outlined here, plus they have the ability to review the suits they hold. That's within their determination. They've indicated, I believe, over the weekend that they will conduct their own investigation. You know, we'll have to wait and determine what they decide they want to do.
Okay. Is it fair to say you've kept them abreast of the ongoing investigation and the findings, etc.?
It is our obligation as a privileged licensee to keep the Gaming Control Board aware of anything that might raise concerns. As I said, they were aware through our minutes and apparently even through some minutes subsequently of Aruze that this was going on. They'd asked us along this process. Yes, we made them generally aware of the fact that we were conducting investigations. You know, the earlier investigations, I outlined some of the facts therein that raised our eyebrows and concerns. Judge Freeh's investigation is much more substantive and more detailed, as you might expect from somebody who ran the FBI. We have made them aware of the fact of his investigation and have sent them a copy of his investigation at this point.
Great, thank you very much.
Your next question comes from the line of Harry Curtis with Nomura.
Hey, good morning. First of all, you have not gotten the shares from the transfer agent. Is that right?
The transfer agent was notified on Saturday evening/Sunday morning that the redemption had occurred, and they're obligated to take whatever action is necessary. The articles are really clear, Harry, providing that the shares are deemed canceled. We feel pretty comfortable that we're covered in that regard.
Has there been any precedent where shares have been canceled and there's been a situation where they've either been delivered either with or without some kind of a lawsuit that attempts to stay that delivery?
I'm not aware of any such precedent. Those shares were certificated shares and not freely tradable anyway, so they fall into a bit of a special bucket.
Okay. Matt, can you just walk us through the math behind the 30% discount and why that's the right number?
We engaged Moelis & Company to provide an evaluation and also a fairness opinion. They focused on a variety of factors, including the restrictions in the shareholder agreement. As Kim pointed out, they made these securities not freely tradable. I don't want to get into the details of that, but I think any of you can do your own analysis and can probably see the merit in this discount.
In this kind of a circumstance, is one fairness opinion typical or generally, are there more?
We feel very comfortable with Moelis & Company and their fairness opinion. The circumstance, I don't know if one fairness opinion or more is the norm, but typically you would see a fairness opinion from a very reputable institution, which we have received.
Okay, thanks very much.
Your next question comes from the line of Felicia Hendrix with Barclays Capital.
Hi. Good morning. Governor Miller, other than through the investigation, have you had any contact with the regulators at PAGCOR? As Okada attempts to find a fence in this, I'm just wondering how relevant it is if he can solicit support by them in this.
I'm sorry. Have we had any contact with the regulators at PAGCOR?
Yes.
In Judge Freeh's report, he indicates that he made an effort to obtain information from PAGCOR relative to the filings seemingly required under Filipino law, to the license granted to Universal and Mr. Okada, and the question under their law, whether there's a possible violation of their requirement for a specific percentage of Filipino ownership and whether that had been subverted. He was not provided that information, as I said earlier, by the Filipino authorities. As I said, the individual that declined, signed the letter of declination to provide it, is one of the individuals receiving comps and other gifts from Universal, Aruze, and presumably Mr. Okada.
I might point out that in Judge Freeh's report, you will find that there, as he outlines potential violations or prima facie evidence of violations of the Foreign Corrupt Practices Act, he doesn't just list one or two or three or four or five or six or seven, and I could go on and on. He lists 37 separate instances. That's exclusive of Mr. Okada's own admission that he and his company paid for part of the costs of Mr. Genuino attending the Beijing Olympics.
Okay, thank you.
Your next question comes from Steven Kent with Goldman Sachs.
Hi. Just two questions. Just to go back on this, I guess I, you know, first, I'm not an attorney. I don't think many of us are on the phone, but doesn't the board or the people who are investigating have a responsibility to tell the Department of Justice, the FBI, the SEC if they even have some questions about an FCPA violation? Don't you need to tell those authorities almost immediately? It just seemed like a long time to wait before telling some of these other regulators beyond just the Nevada gaming regulators.
The second thing is, which I think somebody tried to get at earlier, about strategy, one of the advantages of being affiliated with Mr. Okada was that if you went into Japan or tried to bid on a project in Japan, if there ultimately was an opportunity there, that having the relationship with him would facilitate that, would actually open up the doors a little bit more. How do you now think about Japan as an opportunity if and when the legislation does pass and puts you in a competitive position to get in there?
Steve, this is Kim Sinatra. With respect to the first part of notifications, we've had Foreign Corrupt Practices Act experts, including Judge Freeh and our regular outside counsel, on this from the beginning. We are cognizant of our reporting obligation, and we intend, we feel like we have fulfilled them, and we intend to continue to fulfill them.
Let me just interject. I've given you a year and a half timeline, and perhaps there's the possibility of misconstruing the evidence of the Foreign Corrupt Practices Act violation. The specific evidence on these 37 violations only came to our attention very recently as Judge Freeh pursued his investigation. We awaited only the interview with Mr. Okada to ascertain whether or not there was any refutable evidence, which Judge Freeh concluded did not occur. We have had the advice of outside counsel, but we didn't provide it to the federal authorities because we didn't know it. It was really a short window of time in which we've known of the instances which clearly provide promissory evidence, to quote Judge Freeh, of this.
Somebody else can answer the possibility of investing in Japan, but I suspect that, based on the evidence that we've uncovered, were we to go into Japan with Mr. Okada and Universal Entertainment Corporation and these facts as outlined, I don't see how that would endear to our benefit.
We shouldn't be confused. You know, Wynn Resorts is the premier, high-end integrated resort developer, both, you know, in Las Vegas and in Macau. Our credentials speak for themselves. Any new opportunities that come up, we have to make sure that our reputation is pristine and our product will speak for itself. That's our strategy, and that's what we're going to continue to do going forward.
Yeah. Thanks.
We have run out of time for questions. I'll now turn the floor back to management for any closing remark.
It's Deep Wind again. Thank you, Governor Miller, for the narration and the clarification. I hope what will be for all interested parties, clarification. We will, of course, from time to time, as required by law, make any other declarations or filings as the cases proceed. Thank you all for your attention, and good morning.
Thank you.