Casino Operator Genting Balks as Shareholder Files Fraud Lawsuit
A shareholder in Genting-operated Resorts World Bimini in the Bahamas is suing the company for more than $600 million, as disclosed by a filing from Genting Malaysia Berhad (GENM). The matter involves RAV Bahamas Ltd, a 22% stakeholder in Resorts World Bimini (RW Bimini), which initiated a legal complaint against Genting’s wholly-owned subsidiary, Genting Americas (GAI).
The entrance to the Resorts World Bimini resort in the Bahamas. (Source: Resorts World Bimini)
LISTEN TO THIS ARTICLE:According to GENM’s filing with Bursa Malaysia, the complaint was filed on October 7 and relates to the operations of RW Bimini. The specific details of the lawsuit have not been fully disclosed, but the filing categorized the case under ‘Other Fraud’ by the US District Court for the Southern District of Florida.
Related: Resorts World under Investigation for Money LaunderingBased on information reported by The Bahamas Tribune, RAV Bahamas alleges that Genting has leveraged its majority ownership in RW Bimini to hide liabilities incurred from other properties, effectively shifting these financial burdens onto the books of RW Bimini. The Tribune revealed financial data indicating that RW Bimini had $885 million in liabilities against only $191.5 million in assets as of the end of 2022.
Of those assets, $165.2 million accounted for the value of the resort’s real estate holdings. This significant disparity between liabilities and assets appears to be central to the legal conflict, with RAV Bahamas asserting that it has been adversely affected by the financial decisions and strategies employed by Genting.
RW Bimini is operated by BB Entertainment Ltd (BBE), a company in which Genting, through GAI, holds a 78% stake. RAV Bahamas, as a minority shareholder, claims that GAI has engaged in fraudulent activities that deprived it of potential profits from the resort.
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Misuse of Control
The complaint asserts that GAI orchestrated what is described as a ‘massive and coordinated fraud,’ with actions that allegedly limited RAV Bahamas’ access to RW Bimini’s financial records. The stakeholder has expressed concerns about how the financial liabilities were managed, accusing Genting of misusing its control over the operations of RW Bimini for its benefit at the expense of minority shareholders like RAV Bahamas.
Genting, however, has rejected the allegations raised in the lawsuit. In its filing with Bursa Malaysia, Genting stated that GAI views the complaint as baseless and without merit. The company emphasized its intent to defend the complaint vigorously and announced that it would provide additional updates on the case as and when significant developments occur.
On October 11, Genting Americas, described as an affiliate of BB Entertainment, was officially served with the legal complaint. In the filing, Genting reiterated its stance that the lawsuit holds no merit and reaffirmed its commitment to defending its interests in court.
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