Advertisement

SKIP ADVERTISEMENT

Wynn Resorts Fined $20 Million Over Handling of Steve Wynn Misconduct Claims

Steve Wynn resigned as the chairman and chief executive of Wynn Resorts a year ago after allegations of sexual misconduct surfaced.Credit...Charles Krupa/Associated Press

Sexual misconduct claims have toppled many powerful men in recent years, including the billionaire casino mogul Steve Wynn. But few companies have faced regulatory fines for how they handled the accusations.

On Tuesday, the Nevada Gaming Commission fined Wynn Resorts, the casino empire that Mr. Wynn founded and ran for years, $20 million for ignoring multiple complaints about his behavior.

The fine, which the commission approved unanimously, is the largest imposed against a gambling licensee in Nevada. The previous record was $5.5 million in 2014.

“It demonstrates a recognition that papering over sexual harassment and assault is a form of corporate corruption that is within the scope of regulators’ jurisdiction,” said Emily Martin, the vice president for education and workplace justice at the National Women’s Law Center. “It is an important reflection of the fact that, while harassment and assault harms victims and they need to be compensated, it also has broader harms.”

Mr. Wynn resigned as the company’s chairman and chief executive last February after a Wall Street Journal report described a decades-long pattern of sexual misconduct, including accusations that he pressured employees for sex. He was not paid severance and liquidated his shares in Wynn Resorts.

Mr. Wynn, 77, denied the allegations, but faced immediate and intense backlash. He resigned as finance chairman of the Republican National Committee, and his name was removed from university buildings and programs. Shareholders filed multiple lawsuits, and several regulatory agencies began investigations into the allegations.

Last month, Wynn Resorts and the Nevada Gaming Commission reached a settlement that allowed the company to keep its gambling license. The company acknowledged allegations, laid out by the agency, that several executives and board members had known about complaints against Mr. Wynn.

Those complaints included an accusation from a former salon employee that Mr. Wynn raped her and made her pregnant, a claim he paid $7.5 million in 2005 to settle. A cocktail server said Mr. Wynn had pressured her to have sex from 2005 to 2006, resulting in a $975,000 settlement with Mr. Wynn but no investigation by the company, according to the gaming commission.

Wynn Resorts said in a statement that it had gone through a “paradigm shift” over the past year and “refreshed its culture.” It said that women now made up nearly half its board and that it had removed all employees who were aware of but did not act on the allegations against Mr. Wynn.

“The completion of the review by Nevada regulators is an important step forward, and we deeply appreciate the trust and confidence they have placed in the new leadership of Wynn Resorts to grow and prosper,” the company said.

The allegations against Mr. Wynn raised concerns that damage to the company’s reputation could imperil lucrative Wynn properties in Macau and a development project in Massachusetts.

Companies are often held legally liable in sexual misconduct cases. CBS has made multiple payouts to women with harassment and sexual assault claims. Fox News also struck agreements to settle sexual harassment allegations against Bill O’Reilly.

But regulatory fines in such situations are uncommon, said Ms. Martin, the legal expert. The gaming commission’s involvement in the Wynn case, she said, shows “the cultural shift that has caused these matters to be taken seriously as issues of corporate governance as well as individual behavior.”

Follow Tiffany Hsu on Twitter: @tiffkhsu.

A version of this article appears in print on  , Section B, Page 7 of the New York edition with the headline: Nevada Fines Wynn Resorts $20 Million in Sexual Cases. Order Reprints | Today’s Paper | Subscribe

Advertisement

SKIP ADVERTISEMENT