LV casino officers testify in Lazaroff case

Tuesday, Oct. 10, 2000 | 11:18 a.m.

SUN STAFF AND WIRE REPORTS

JEFFERSON CITY, Mo. -- Faced with the possible loss of licenses for its casinos in Kansas City and St. Charles, Station Casinos Inc. of Las Vegas brought top executives to Jefferson City today to testify before the Missouri Gaming Commission.

Their refusal to appear at an earlier hearing in Kansas City last month led the commission to vote to revoke licenses of the casinos. That action is being appealed, but the commission gave the executives a second chance to testify about the activities of a St. Louis attorney who formerly represented the company.

Charles German, a Kansas City attorney for Station, said at the start of today's hearing that the executives, including president and CEO Frank J. Fertitta III, would testify although the company believes the session should be closed.

The hearing, German said, is "unauthorized by law and it's inappropriate to proceed," but that the company had decided to cooperate.

"We do our best to protect our ability to operate," German said.

The first hearings, held in Kansas City in August, centered on allegations that St. Louis attorney Michael Lazaroff, who represented Station during the licensing process, used $500,000 in bonuses received from the company to improperly influence public officials on Station's behalf. However, Lazaroff denied this allegation, and evidence showed Lazaroff had used the funds for debt and tax payments and home improvements.

Missouri regulators have since focused their investigation on Lazaroff's relationship with Robert L. Wolfson, former chairman of the commission, and whether that gave Station an unfair advantage in getting its licenses.

Lazaroff pleaded guilty in U.S. District Court at St. Louis to mail fraud and he was sentenced early this month to 30 days in jail and 90 days of home confinement. He testified at the commission's hearing in Kansas City.

The first Station executive to testify, chief financial officer Glenn Christenson, said he was unaware of any contacts between Lazaroff and Wolfson that dealt specifically with Station's licensing. He said he understood the contact to be merely social.

"I know that Mr. Lazaroff and Mr. Wolfson were friends, and I know they would talk on occasion," Christenson said. "I don't remember anything specific about Station Casinos."

In response to several questions asking if he knew of any specific conversations or correspondence between the two related to Station, Christenson said, "I don't recall."

Asked whether he was concerned that the two men might be violating state law by discussing casino-related issues, he said, "Those guys knew what the rules were."

Just before a recess, the current commission chairman, L. G. Ullery, raised questions about Christenson's lack of recall, saying, "It's a bother of mine."

Christenson was being questioned by an attorney for the gaming commission and the attorney general's office, as well as commissioners themselves.

Also present at today's hearings was Scott Nielson, Station's general counsel. A Station spokesman said it wasn't known yet if other officials would be called today.

The only Station official to have honored the August subpoenas was Troy Stremming, the company's Midwest counsel. Stremming testified briefly in August, but said he had no knowledge of improper contacts between Lazaroff and Wolfson.

Paul Sloca of the Associated Press in Jefferson City and Sun reporter David Strow contributed to this story.