Date: November 19, 2024
Category: Japan, Latest News, Global Updates
A former New York Stock Exchange-listed company, initially known as 500.com Ltd and now operating under the name BIT Mining Ltd, has agreed to pay a $10-million penalty to U.S. authorities. The charge stems from its involvement in a bribery scheme targeting Japanese government officials as part of its effort to establish a casino resort in Japan.
The bribery, which occurred between 2017 and 2019, violated the U.S. Foreign Corrupt Practices Act (FCPA). Originally, the U.S. Department of Justice (DOJ) assessed a $54-million penalty for the offense, but the company’s financial situation led to a reduced payment agreement. BIT Mining is also set to pay up to $4 million to the U.S. Securities and Exchange Commission (SEC) as part of a parallel investigation.
Charges Against Former CEO Zhengming Pan
Zhengming Pan, a Chinese national and former CEO of 500.com, has been charged under the FCPA for orchestrating the bribery scheme. Allegedly, Pan directed consultants to funnel approximately $2 million in illicit payments to Japanese officials through fraudulent consulting contracts.
DOJ Principal Deputy Assistant Attorney General Nicole M. Argentieri emphasized the department’s commitment to accountability:
“BIT Mining, under the leadership of then-CEO Pan, engaged in widespread bribery to secure a lucrative casino contract in Japan. Today’s resolution underscores our commitment to holding both corporations and individuals accountable for corrupt practices.”
SEC Investigation Findings
The SEC further revealed that the bribes, amounting to approximately $2.5 million, included cash payments, entertainment, and luxury trips. These extravagant measures were allegedly used to gain favor with Japanese officials.
Fallout in Japan
The scandal also implicated former Japanese lawmaker Tsukasa Akimoto, who received a four-year prison sentence and a fine of JPY7.5 million (approximately $48,000) in September 2021. Akimoto was accused of receiving bribes as part of the proposed casino project in Hokkaido Prefecture.
Before the bribery scandal came to light, the governor of Hokkaido had already withdrawn the prefecture’s bid for casino liberalization in November 2019. Despite these setbacks, discussions about a potential casino in the region continue. In June 2024, supporters of a casino project in Tomakomai, an economically struggling port city in Hokkaido, held a meeting advocating for its potential to stimulate economic recovery.
Luckshots Perspective
At Luckshots, we believe transparency and ethical practices are vital for the growth and sustainability of the global casino industry. This case highlights the importance of holding companies accountable for unlawful practices, ensuring a fair and corruption-free gaming landscape.