Wynn Las Vegas Facing Lawsuit from Canadian Mining Company Over Fraudulent Gambler

Giant casino resort Wynn Las Vegas is being sued by Canadian mining company James Bay Resources. The action comes over allegations Wynn allowed a convicted Californian fraudster to gamble money lent to him by Bay Resources for business purposes. 

Convicted fraudster David Bunevacz gambled an estimated $3.8 million at Wynn Las Vegas between late 2018 and mid- 2019. The whole time, he was on a three-year probationary sentence in California for securities fraud charges. 

He was later convicted of defrauding $39 million from investors in various businesses, and in 2022, he was sentenced to 22 years.

James Bay says it believes a significant amount of the money gambled at Wynn came from business loans totaling $4.6 million it made to Bunevacz at around the same time.

Wynn Las Vegas had “ample opportunity to discover Mr. Bunevacz’s criminal record” through regulator-required know your customer and anti-money laundering processes, the lawsuit says. Yet Wynn did not discover the illicit source of Bunevacz funds. 

The Toronto-based lithium mining operator has not yet disclosed how much in damages it is seeking from Wynn Las Vegas. 

The casino’s parent company, Wynn Resorts, recently paid out the largest settlement involving a Nevada gambling operator, ponying up $130 million to the U.S. Department of Justice. 

The Lawsuit

James Bay first filed the lawsuit against Wynn in April, but only revealed the news publicly late last week in a statement. As well as $3.5 million the company lent Bunevacz, its CEO, Stephen Shefsky, also gave him a $1.1 million business loan from his personal accounts. 

All the businesses, including a cannabis vape production facility, turned out to be fraudulent. The lawsuit says Wynn did not do its required due diligence checks on Bunevacz before allowing him to gamble millions. 

“Wynn failed to discharge its duties pursuant to U.S. state and federal banking laws, Nevada gaming rules, and the common law to conduct adequate due diligence into Bunevacz, and that had it done so, it would have discovered Bunevacz’ criminal record, investigated the source of his funds, and thereby prevented the Plaintiffs’ losses,” the lawsuit says. 

Bunevacz’s Frauds

Aside from stealing from Shefksy and James Bay, Bunevacz was convicted in 2022 of fraudulently obtaining $39 million in investments from some 40 other victims. He was sentenced to 17 years in prison in California.

Funds meant for his weed vape pen business were instead spent on paying off later investors, buying luxury cars and clothing, and staging lavish parties for himself and his family. That’s as well as around $8 million in total gambled at casinos in Las Vegas and elsewhere. 

Bunevacz was known in rich and famous circles after finding some fame as a track and field athlete in the 1990s. He won gold at various continental competitions in Asia and competed for the University of California at Los Angeles. That included one gold medal even though he finished second, as his first-place opponent was later disqualified for doping.

Wynn’s Expenses 

If Wynn Resorts is forced to settle this lawsuit, it will be another big financial blow for the operator. Although it is one of the most popular high-end luxury gambling destinations in Las Vegas, and therefore the world, it has paid hundreds of millions in legal settlements in recent months. 

First, it paid an unenviable Nevada gambling business record settlement of $130 million to the Department of Justice. That was to settle claims it allowed gamblers of suspicious provenance to deposit and play at Wynn Las Vegas. 

It also recently paid $70 million to former investors who claimed they were not told of the risk of pending sexual misconduct allegations against former CEO and founder Steve Wynn when they invested, which led to financial losses when shares declined after the story broke. 

Since Steve Wynn departed the company in disgrace in 2018, the operator has paid out a further $50 million in settlements to various parties to settle the fallout.