Las Vegas Sands casino to pay $47.4 million to end federal probe [Reuters]
The Las Vegas Sands Corp (LVS.N) agreed to return $47.4 million to the U.S. Treasury to end a probe into the casino's failure to alert authorities to suspicious deposits by a high-rolling gambler, federal officials said on Tuesday. Sands, the operator of the Venetian and Palazzo hotel complex in Las Vegas, accepted wire transfers and cashier's checks between 2005 and 2007 from Zhenli Ye Gon and should have reported the transactions as suspicious, said the U.S. Attorney's Office in Los Angeles. By the end of 2006 or early 2007, Ye Gon was "the largest all-cash, up-front gambler the Venetian-Palazzo had ever had to that point," according to the non-prosecution agreement.
Last Gasp for Stock Options? [CFOJ]
The once-popular form of pay, which for decades enriched senior executives and sometimes turned secretaries into millionaires, is almost disappearing as companies gravitate toward restricted stock awards. The trend has accelerated in the past couple of years, in response to shareholder demands, tax-law changes and the financial crisis, which left executives and employees at many companies holding worthless options. At their peak in 1999, stock options accounted for about 78% of the average executive’s long-term incentive packages. Last year, they represented just 31%, and are expected to shrink to 25% in the next two years, based on grant values so far this year, according to an analysis of the 200 largest U.S. public companies by compensation consulting firm James F. Reda & Associates.
How Washington Will Use the Coming Budget Wars To Duck Hard Choices [TaxVox]
A dwindling few see this depressing confluence of fiscal deadlines as an opportunity to reach the long-awaited Grand Bargain. But in reality it is just the opposite, an excuse to avoid the tough choices of tax and entitlement reform. After all, it is easier for Washington to battle over self-made, short-term crises than resolve structural tax and spending challenges.
Look how well Grover stayed within the lines! [@GroverNorquist]
— Grover Norquist (@GroverNorquist) August 27, 2013
A Holiday From Taxes, and Often From the Strings Attached [DealBook]
Tax policy experts are suspicious of tax holidays, and most experts question the effectiveness of attaching strings to such legislation. Because cash is fungible, companies might be expected to use the repatriated money for permitted domestic activities that they would have conducted anyway, freeing up other cash to be used for dividends and stock buybacks. If companies merely reshuffle the use of cash without changing behavior, then the tax holiday amounts to a windfall to shareholders, not an effective economic stimulus. The 2004 tax holiday brought back $312 billion in extraordinary cash dividends from foreign subsidiaries. How much of that cash was used for permitted activities, and how much for impermissible dividends and stock buybacks? A 2011 paper by Dhammika Dharmapala, C. Fritz Foley and Kristen J. Forbes, published in The Journal of Finance, estimated that 60 cents to 92 cents of every repatriated dollar was spent on shareholder payouts in 2005. The paper is Exhibit A in the case against future tax holidays.
McDonald's Will Start Serving Chicken Wings Next Month [Gawker]
“It's like the Colonel adding a cheeseburger.”