April 2, 2019 / 2:09 PM / 3 months ago

UPDATE 3-Massachusetts says Wynn Resorts execs concealed sex accusations involving Steve Wynn

(Adds statement from Wynn’s lawyer, details from report, comment from Wynn Resorts CEO)

By Nate Raymond

BOSTON, April 2 (Reuters) - Massachusetts gaming regulators on Tuesday released an investigative report concluding that former executives of Wynn Resorts Ltd concealed sexual misconduct allegations against the casino operator’s billionaire founder, Steve Wynn.

The Massachusetts Gaming Commission released the report at the start of a three-day hearing focused on whether Wynn Resorts should retain a license needed to run a $2.6 billion casino built outside of Boston expected to open in June.

Brian Kelly, Steve Wynn’s lawyer, said his client “denies all allegations of non-consensual sex and nothing in this report changes that.”

The report by the commission’s investigations and enforcement bureau followed a January 2018 article by The Wall Street Journal detailing allegations that the billionaire had engaged in a decades-long pattern of sexual misconduct.

His subsequent exit as the company’s chief executive and sale of his stake in Wynn Resorts made him one of the most prominent executives to lose his job amid the #MeToo movement, which has highlighted longstanding patterns of sexual harassment and abuse in major U.S. institutions.

The report recommended commissioners consider recent reforms Wynn Resorts has adopted. The company said it has improved its human resources functions, arranged for Wynn to leave without severance and parted ways with anyone who did not investigate or report allegations against him.

Wynn Resorts Chief Executive Matt Maddox said he was “deeply remorseful” for what happened.

Wynn Resorts shares were up 4.29 percent at $134.89. Union Gaming analyst John DeCree in a report said he expected the company will keep its license but be forced to pay a fine and face additional oversight.

The Las Vegas-based company received its Massachusetts license in 2013, allowing it to move forward with building the 671-room “Encore Boston Harbor” in Everett, Massachusetts.

The Massachusetts investigators concluded that over several years, some executives and employees disregarded company policies when it came to sexual misconduct allegations against Wynn involving other employees.

The 199-page report said certain executives also took steps to conceal allegations involving Wynn, leading in one case to a confidential $7.5 million settlement in 2005 with a manicurist.

The report said those actions “appear to have contributed to a culture where employees were reluctant to report allegations against Mr. Wynn to management.”

The commission is not expected to issue a decision for several days or weeks. Nevada casino regulators, following a similar investigation, in February fined the company $20 million.

Reporting by Nate Raymond Editing by Scott Malone and Nick Zieminski

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