In what could be bad news for gambling expansion and investors, the Las Vegas Sands Corporation has revealed that it is being investigated by the U.S. Securities and Exchange Commission (SEC). The admission was part of the annual report that the Sands filed today. In that report, the corporation stated that it has received a subpoena from the SEC for an investigation.

According to the Las Vegas Sands, the SEC has subpoenaed them requesting documents relating to compliance with the Foreign Corrupt Practices Act (FCPA). The Department of Justice is also conducting a similar investigation into the business practices of the Sands. According to the Wall Street Journal, the U.S. has recently started enforcing the Foreign Corrupt Practices Act more aggressively. Eight of the ten largest settlements in FCPA matters occurred last year.

Ron Reese, a spokesman for the Las Vegas Sands, denied any wrongdoing and said that the government’s investigations are nothing more than “fact-finding inquiries.” He said that be believes that the investigation is taking place due to allegations made by Steve Jacobs, former CEO of Sands China.

The Foreign Corrupt Practices Act, passed by Congress in 1977, requires transparency and prohibits companies from making payments (read: bribes) to foreign officials in order to obtain or keep business in that country. Las Vegas Sands Corporation began in Nevada, but has expanded their reach and now makes most of their money in Macau, which is the largest gambling industry in the world (four times the size of Vegas). Sands currently has three casinos in Macau.

In July 2010, Jacobs was terminated. The company said that he had exceeded his authority and failed to keep the board of directors in the loop for important business decisions. Shortly after his termination, Jacobs filed a lawsuit against his former employer in a Nevada federal court. In the lawsuit, Jacobs alleged that the real reason he was fired was because he refused to carry out illegal demands by Sheldon Adelson, Chairman of the Las Vegas Sands.

According to Jacobs, he was told to arrange “secret investigations” on Macau government officials in order to use any negative information against them as blackmail. He also alleged that Adelson told him to threaten to withhold business from major banks in China unless those banks used their influence to convince the government officials to give the Sands favorable treatment.

If Jacobs’s allegations are true, those would be major criminal offenses, not just SEC rule violations but other federal and international crimes as well. Representatives from Las Vegas Sands have denied all allegations by Jacobs and say that they have not committed any SEC violations.

If the word China is in one of my headlines, you can assume it’s not good news. It’s rare that anything good comes out of that country, though you could argue that their economy is currently more free than in the United States. Still, the U.S. doesn’t have the record of killing people for political dissent, purposely starving millions and controlling every aspect of a person’s life, at least not yet.

It’s no secret that China frowns upon online gambling, probably because it allows people to have control over their own money and spend it in ways they see fit. No, wait, that can’t be the reason. I’m sure they’re doing it for the people’s own good, protecting them from themselves. Authoritarian governments around the world have done unspeakable things in the name of protecting its citizens and doing what is good for them, whether they realize it or not.

Today’s news out of Red China is that two men have been arrested for search engine optimization (SEO). The Chinese government says that the two men worked for Baidu, a Chinese search engine company that basically provides a Chinese alternative to Google, Wikipedia and other sources of information. According to police, those men were paid by 777 Real Casino to work on their website, optimizing their content to make them rank better on the search engine.

According to the Chinese government, doing SEO work for the company amounts to illegally promoting an online casino, an offense that, like everything else in China, carries a prison sentence. In response to the arrests, Baidu stuck up for their employees and stood with them against the evil government.

Just kidding. They cowered like frightened dogs and distanced themselves from the employees, saying they had no knowledge of their activities (which may be true). They also apologized and said that Baidu “has always obeyed our country’s laws and regulations and we strongly oppose the behavior of those who use the Internet to engage in criminal activity.”

As someone who writes blogs about online casinos using SEO, I’m glad I don’t live in China. Of course, I’m also glad I don’t live there because I enjoy eating regularly and having some freedom.

According to Xinhua, China’s government-run news agency, the Chinese government has successfully taken down a major online gambling ring. According to their reports, last month the government broke up a highly organized and sophisticated gambling ring that has gained more than ¥100 billion ($14.8 billion).

Prior to the World Cup, China promised to crack down on illegal online gambling, which they say is a menace to society in the same way that freedom of speech and democracy are. Bets can be placed in three state-run lotteries, but all other gambling is illegal on the mainland. In addition, online gambling of any kind is strictly prohibited.

According to Xinhua, the ringleader of the online gambling ring went by the name of “Dark Brother.” He was supposedly arrested as he left a “cocaine-fuelled nightclub party” in Shenzhen. According to the oppressive communist government, who I find trustworthy and have no reason to doubt, Dark Brother led an organized gambling ring that encompassed southern and eastern China. Another member of the ring, who went by “Old Cat,” helped run the operation from her apartment.

China did not qualify for the World Cup this year, but that didn’t stop the Chinese people from betting lots of money on offshore bookmakers. In total, the Chinese Center for Lottery Studies estimates that more than ¥87 billion is spent on online gambling by Chinese citizens.

Because online gambling is so secretive, it has been hard for the government to stamp out, despite their strict controls over the internet. After the embarrassment of a fraud scandal involving Chinese soccer referees, though, the government has vowed to put an end to online betting. If any country can do it, it would be China, who is better than most at denying basic liberties.

At least this crackdown didn’t involve running people over with tanks. China has vowed to crack down on gambling in the country and has been doing just that. A recent raid in the province of Yunnan has resulted in an arrest of 21 suspects accused of running an illegal online gambling operation. In addition, their bank accounts containing approximately ¥550,000 have been frozen.

Back in February, China’s Ministry of Public Security placed a new emphasis on putting an end to online gambling in the Middle Kingdom. Since that time, they have arrested over 3,600 suspects and frozen over ¥700 million in funds, according to the state-run Xinhua News Agency.

Gambling – both online and land-based – has been banned in mainland China since the communist government took power in 1949. I think it’s because they don’t like an individual having an influence over whether their amount of money gets larger or smaller. The government wants to be the one that decides that (after all, there are state-run lotteries).

With the World Cup taking place in South Africa, China is currently placing an emphasis on sports betting. All overseas online casinos and sports books are banned from accepting Chinese customers. China monitors those sites to look for activity from its citizens. If any get through, there can be swift “justice” exacted upon the Chinese citizen. Of course, if you’re a Chinese citizen, there’s a good chance that the Communist Party of China monitors everything you do anyway, as we have found from the controversy surrounding their hacking of Gmail.

China defends controlling how people spend their money, what information they get from the news, and what terms they can search on the internet on the grounds that they are protecting the nation by removing things that would harm the people. Letting people gamble is bad because it’s not good for them. Engaging in nuclear proliferation with North Korea – a nation that might be crazy enough to start a nuclear holocaust, denying freedom of religion, freedom of property and the right to vote for their national leaders is what’s best for the people, though.