Wynn Resorts failed to report sex allegations to Mass. gaming

Las Vegas-based Wynn Resorts Ltd. plans to open the $2.6 billion Encore Boston Harbor in June in Everett, Massachusetts. (Massachusetts Gaming Commission)Steve Wynn delivers the keynote address at Colliers International Annual Seminar at the Boston Convention Center in Boston in January 2015. (Elise Amendola/AP)Matt Maddox, CEO of Wynn Resorts Ltd., attends a meeting of the Nevada Gaming Commission, Feb. 26, 2019, in Las Vegas. (Bizuayehu Tesfaye/Las Vegas Review-Journal) Encore Boston Harbor casino is pictured on Feb. 16, 2019, in East Boston, Massachusetts. (Paul Connors/Boston Herald)Encore Boston Harbor casino as seen from Somerville, Massachusetts, Dec. 6, 2018. (Chris Christo/Boston Herald)Encore Boston Harbor casino as seen from Assembly Square, Dec. 6, 2018 in Somerville, Massachusetts. (Chris Christo/Boston Herald)

BOSTON — Top executives at Wynn Resorts Ltd. for years covered up reports that former Chairman and CEO Steve Wynn paid a $7.5 million settlement to a female employee who said he forced her to have sex with him, a report issued Tuesday to the Massachusetts Gaming Commission said.

All of those executives and Wynn himself are no longer with the company.

In the first of two to three days of testimony before the commission, Karen Wells, lead investigator for the commission’s Investigations and Enforcement Bureau, explained how her team tracked down settlements Steve Wynn made, including the 2005 incident which the employee, a manicurist, said led to her becoming pregnant.

A deposition of Wynn was part of the report record and said he acknowledged a sexual relationship with the woman but that she initiated it.

High stakes

Wynn Resorts CEO Matt Maddox acknowledged the lack of disclosure and apologized for the pain employees and their families endured. But he also noted that every executive involved in the cover-up iss no longer with the company and several members of the board of directors who oversaw the company also are gone.

The stakes are high for the company, which plans to open its $2.6 billion resort, Encore Boston Harbor, in Everett, Massachusetts, in June. It has already has begun hiring employees and taking reservations.

The five-member commission hopes to determine when company executives learned of and how they reacted to the sexual harassment allegations against Steve Wynn reported in January 2018. Steve Wynn has denied all harassment accusations, but resigned his position in February 2018 and separated himself from the company later in the year.

The report says three individual licensed qualifiers — Steve Wynn, his former wife Elaine Wynn, and former general counsel Kim Sinatra — “had knowledge of a settlement agreement from 2005,” but failed to disclose it when the company appeared before the commission for licensing in 2013.

After the review of the report, commissioners took the first step toward vetting new executives and board members to determine if they are suitable to lead the company.

Commissioners found no issues with new board Chairman Phil Satre and members Dee Dee Myers, Betsy Atkins, Winifred “Wendy” Webb and Richard Byrne. They also were confident in new Chief Financial Officer Craig Billings and new chief counsel Ellen Whittemore.

When the hearing resumes Wednesday, Wynn Resorts is expected to make a presentation emphasizing the transformation that has occurred within the company since the harassment allegations were disclosed.

Commissioners also are expected to question Steve Wynn’s former wife, Elaine Wynn, Wednesday and her role in the matter.

The commission has stated that once the hearing is concluded, it would go into a closed session to deliberate. The commission will issue a written decision and determine if the seven board members and executives are suitable to lead the company.

Prior to the beginning of Tuesday’s hearing, a gaming industry analyst said he expects Wynn Resorts will be allowed to keep its license, but would be heavily fined.

“It’s impossible to tell how these things will go, but based on the information available, we expect Wynn Resorts to maintain its license but get hit with a substantial fine (greater than the $20 million levied by Nevada Gaming Commission), and be subjected to regulatory probation and additional oversight,” John DeCree, a Las Vegas-based analyst with Union Gaming said in a report to investors.

Richard N. Velotta at or. Follow on Twitter. Review-Journal staff writer Todd Prince contributed to this report.

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