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After winning the competitive Boston-area casino license, Wynn's project still faces hurdles

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BOSTON — New hurdles are emerging for Wynn Resorts as it prepares to build a $1.6 billion resort casino on the Everett waterfront after winning the lucrative casino license for the Boston area.

Somerville filed a lawsuit last week against the state Gaming Commission asking a state court judge to void the Wynn license.

The city argues regulators should have disqualified the company or at least required it to abandon its proposed site after it became public that a convicted felon had a financial interest in the land deal, a violation of state law.

Meanwhile, the gambling commission's staff last week disclosed it is conducting an inquiry after the Wall Street Journal reported that the IRS's criminal investigation division requested information on Wynn's clients, domestic and overseas marketing offices and internal controls. The newspaper said federal authorities are probing whether the Las Vegas-based gambling giant violated money laundering laws.

Those developments come as the casino is focused on plans to clean up the polluted former Monsanto chemical plant site ahead of breaking ground on the project.

And Boston Mayor Martin Walsh said this week that his administration is still in talks with the casino on a possible compensation agreement since the resort is expected to impact traffic in and around Sullivan Square.

Anti-casino activists say the Somerville lawsuit, which follows one filed in October by the city of Revere, is unsurprising.

"Somerville has been pretty open about its intention to try to slow down if not stop the project," said John Ribeiro, head of Repeal the Casino Deal.

The gaming commission said the suit repeats allegations already investigated by its staff. "The Commission continues to believe firmly that its approach to the land transaction was fully in keeping with its statutory and regulatory obligations and fully protected the public interest," it said in a statement.

But Somerville Mayor Joseph Curtatone, a vocal opponent of casinos, fired back this week: "The gaming commission hasn't really done much to really build the confidence of the public. ... To say they've thoroughly investigated the worst kept secret in mankind is really a joke."

Boston College economics professor Richard McGowan, who studies the gambling industry, said the money laundering allegations could have wider implications than the lawsuits, which he considers longshots.

"It makes it look like the commission did not do a very good job of due diligence," he said. "It also puts a stain on the whole process."

Karen Wells, director of the gaming commission's Investigations and Enforcement Bureau, told commission members last week that her office was unaware of the IRS's August information request until a Wynn official emailed the Wall Street Journal article that was published late last month.

Wynn maintains it is not aware of any criminal investigation related to money laundering and has declined to comment on the Somerville and Revere lawsuits.

"We've not received notice that the company is under investigation," said Michael Weaver, a casino spokesman. "Requests for information from agencies and regulators occur in the casino industry."

In other casino developments, MGM Resorts International hosted an information session Thursday in Springfield for contractors, vendors and construction suppliers. The company is preparing to break ground next year on an $800 million downtown Springfield casino.

And the owners of the former Raynham dog track say they may seek a state license to build a resort casino at the Brockton Fairgrounds.

The Carney family had hoped to convert Raynham Park, now a simulcast betting facility, into a slots parlor, but the gaming commission awarded that license to Plainridge Racecourse in Plainville.

The deadline to submit applications for the remaining casino license, which is reserved for the southeastern Massachusetts region, is Jan. 30.

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