VIP room staff accused of fleeing with millions

Wynn Macau casino shares have suffered a fall in light of reports of an alleged theft by a VIP room operator. According to the Financial Times, which cites a note from Daiwa Capital Markets released last Thursday, “Staff at Dore Holdings, a VIP room operator in Macau, have allegedly fled with between HKD200 million and HKD2 billion.”
Dore Holdings, the VIP room operator mentioned in the report, operates within Wynn Macau. The company has already stated that the incident bears no direct relation with the company and its operations.
A Wynn spokesperson was quoted by the Financial Times as saying: “The current reported concerns with respect to Dore, one of Wynn Macau’s junket operators, have no direct financial impact on Wynn Macau. Dore owes no money to the company and continues to operate in Wynn Macau,” adding that the company will continue to monitor the situation.
Although Wynn claims that no direct financial impact will result from this episode, the fact is that the indirect impacts were felt immediately. Shares in Wynn, a Hong Kong-listed company, declined by 3.55 percent on Friday, reaching their lowest point since July 2010.
A person named Jean-Christophe Scolari was the first junket representative appointed by Wynn Macau, according to a Hong Kong Stock Exchange disclosure dated August 2006. Scolari initially wholly owned and was the sole director of Dore Entertainment Company Limited, which he founded.
During the mid-to-late 2000s, Dore Entertainment’s operations were affiliated with a Hong Kong-listed firm called Teem Foundation Group Limited, which was later renamed Dore Holdings Limited. According to documents from September 2006, which are cited by Macau Gaming Watch’s website, Teem Foundation Group invested HKD539 million in Dore Entertainment’s VIP room profits at the Wynn Macau. Around three years later, the listed firm, now called Dore Holdings, agreed to sell back its interests in Dore Entertainment profits to Mr Scolari for HKD500 million.
Around that time, Hong Kong resident Kelvin Kam acquired Mr Scolari’s ownership stake in Dore Entertainment, as well as the firm’s directorship.
Mr Kam, who was also the sole owner of another Macau junket (Eight Elements Entertainment Limited) with operations at the Hotel Lan Kwai Fong, has established several other Macau-based private companies in different business fields over recent years. This included a partnership with the VIP operator SunCity Group Limited, owned by Alvin Chau and Cheng Ting Kong, as cited on the Macau Gaming Watch website; there the firm held three “Dore” named VIP clubs in September 2013, totaling 44 gaming tables.
This episode’s shockwaves have come after a similar report released in April 2014 when the local gaming industry was rocked by reports that an agent at another VIP room operator, named Kimren, fled with between HKD8 billion and HKD10 billion, creating a situation that allegedly scared away some of the investors who provided financing to junkets.
In the same note from Daiwa, analyst Jamie Soo said, “As a whole, the junket segment never recovered from this liquidity squeeze since,” referring to the Kimren incident. “We are already seeing signs of this today, with individuals purportedly rushing to the junket (Dore) in an attempt to withdraw funds.”
According to official figures, in 2013 there were 235 registered junkets, but within only the last year, more than one fifth of them have closed their operations in wake of Beijing’s anti-graft campaign, which has resulted in a drastic reduction in both VIP and mass-market gamblers.
Until June 2015, VIP turnover at Wynn Macau sank by 47 percent to HKD254 billion. Year-to-date gaming revenue is down 36.5 percent, according to official figures through August. This has dragged down share prices of the six big Macau casino operators by about two-thirds since their last peak back in January 2014. MDT/Agencies

Dore Group investors protest outside Wynn Macau

Around 30 Dore Group investors protested last Saturday afternoon outside the Wynn Macau resort. They were demanding an early release of their investments from the junket group after a cage manager allegedly embezzled HKD2 billion.
The protesters, with masks over their mouths, also sought to hold a face-to-face dialogue with managers of the junket operator, which owns two VIP rooms on the American gaming company’s premises, over the theft and the situation of their investments.
According to their rough estimate, the total sum of investments held by around 60 investors – 60 percent of them locals – might amount to HKD700 million, which could have been compromised by the embezzlement that surfaced late last week.
As one of the leading junket groups in the region, Dore Group is estimated to account for around four to five percent of the entire industry volume, estimates UBS. It was also said that the two troubled VIP rooms operating inside Wynn Macau held between 10 and 25 percent of the casino’s junket volume.
The Apple Daily in Hong Kong reported, citing its source, that the junket has already suspended its operation in the casino and stared down the barrel of permanent service suspension therein.
Some protesters told journalists that the Dore Group was established a long time ago and has built its reputation over the years. However, the embezzlement, which was confirmed by Dore last Friday through a statement, came as startling news to them.
The theft prompted a wave of immediate withdrawal requests from the group’s clients. Those attempts were met with denials. So far, the protesters received no official response over the fate of their deposits. The Judiciary Police launched a probe into the issue after complaints starting pouring in last Wednesday.