Industry News

Tour takes a siesta this week on Mexican tycoon’s past

By Gary Van Sickle

The PGA Tour’s World Golf Championship is back this week and being hosted again by a billionaire tycoon whose past includes at least one major shady business deal.

Donald Trump? No. Meet Ricardo Salinas. He owns TV Azteca, Mexico’s second-largest broadcaster. It is his company, Grupo Salinas, that sponsors the renamed Mexico Championship, which relocated from Trump’s Doral to Mexico City and is being played at Chapultepec Golf Club in the mountainous capital. 

The U.S. Securities and Exchange Commission sued Salinas in 2005 on fraud accusations. TV Azteca officials were alleged to have concealed Salinas’ involvement in a deal between TV Azteca and Codisco, a company secretly owned by Salinas. Salinas and a fellow TV Azteca business partner used Codisco to buy discounted debt owed by a cellphone unit of TV Azteca, knowing that the cellphone unit would repay the debt at full price. When it did, Salinas and his partner each raked in $109 million in profit.

The SEC suit was settled in 2006 when Salinas agreed to pay a $7.5 million fine, a mere slap on the pinky finger, while the other official ponied up $1 million. Both men were barred from serving as executives or directors on any publicly listed American company. Salinas admitted no wrongdoing in the case, the first lawsuit filed against a foreign company under the Sarbanes-Oxley Act. In a telling action during the suit, however, Salinas de-listed his companies from the New York Stock Exchange because of what he termed “excessive regulation.”

PGA Tour commissioner Tim Finchem was sailing along smoothly in a news conference at Doral last year when he announced the new sponsor and move to Mexico City until I asked a question about Salinas and his SEC troubles. Heads turned in the room, but an unflustered Finchem, who retired at the end of the season, said the Tour had researched Salinas and was aware of the case, adding, “Given the facts, it should not be something that would preclude us to do this particular transaction.”

What are the facts? Salinas knowingly violated SEC rules for his own gain and paid a relatively petty fine rather than risk a courtroom conviction. If former inside traders Ivan Boesky and Michael Milken sponsored a marquee PGA Tour event, wouldn’t that be fairly controversial? Well, the feel-good vibe about taking the WGC event to the poor people of Mexico has eliminated any talk about Salinas. 

It would have been much worse had the WGC event stayed at Doral. As president, Trump is the home of lightning-rod controversy these days. He was at the center of controversy last year when he simply was just another Republican presidential candidate because he had made statements about Mexican illegal immigrants that were criticized as being anti-Hispanic, upsetting many in the surrounding Miami community. 

Trump stayed away from the Cadillac Championship all week until Sunday, when he drew live coverage from Golf Channel as he helicoptered into Doral and was escorted onto the range before the final round to say hello to several Tour players. The New York Times story featured this website headline: “Adam Scott wins at Doral as Rory McIlroy falters after a handshake from Donald Trump.” McIlroy held a three-shot lead after 54 holes but stumbled to a closing 74, prompting the Times to report,  “Trump also shook hands and held a brief conversation with Dustin Johnson, the only other player on the range when he blew through. Johnson, the defending champion, closed with a 79, suggesting that not everything touched by Trump … turns to gold.”

The Curse of Trump theme would’ve played better if anyone watching Golf Channel hadn’t seen Trump’s first move upon arrival, which was to shake hands with Scott and talk with the eventual winner before chatting up McIlroy and Johnson. Mentioning that would have ruined the story’s angle, however. 

Just like bringing up the SEC violations by Salinas and questioning why the PGA Tour is in business with him would ruin this week’s feel-good mood.

Gary Van Sickle has covered golf since 1980 for Sports Illustrated and Golf.com, Golf World and The Milwaukee Journal. Email: gvansick@aol.com; Twitter: @GaryVanSickle