Dem campaign group retracts claims GOP donor Adelson financially tied to prostitution

House Democrats' campaign arm is retracting claims it made that Las Vegas casino mogul Sheldon Adelson, a prominent Republican donor, was financially tied to prostitution -- claims it now says "were untrue and unfair."

The retraction comes after Adelson's lawyer sent a letter last month to the Democratic Congressional Campaign Committee asking it to "retract and apologize for" what it called defamatory and libelous claims that Adelson, who heads Las Vegas Sands Corp., encouraged and profited from prostitution in Macau and donated "Chinese prostitution money" to Republican leaders.

The allegations were first made by fired Sands China Ltd. executive Steven Jacobs, in a seven-page sworn declaration filed June 27.

The Sands' six-page response argued that no weight should be given to what Sands attorneys call the "inflammatory and personally derogatory" claims. It includes a copy of a May 2009 email suggesting that Jacobs knew that Adelson doesn't tolerate prostitution at any Sands properties.

Prostitution is legal in Macau. But in the email, Jacobs told top Las Vegas Sands executive Michael Leven that before beginning a planned crackdown on soliciting for sex on the casino floor at Sands Macau properties, he wanted to make sure Adelson agreed. Jacobs said in the email that another executive told him Adelson personally approved allowing prostitution "as it would help our overall gaming revenue."

Adelson and Sands attorneys accused Jacobs of "a new low" in what they call an ongoing effort to tarnish Adelson's reputation and call attention to Jacob's claim that he was wrongly dismissed.

"Plaintiff's reckless and irrelevant allegation that Mr. Adelson endorsed a 'prostitution strategy' is false," they state.

As for the Democratic Congressional Campaign Committee, it issued this retraction Thursday: "In press statements issued on June 29 and July 2, 2012, the DCCC made unsubstantiated allegations that attacked Sheldon Adelson, a supporter of the opposing party. This was wrong. The statements were untrue and unfair and we retract them. The DCCC extends its sincere apology to Mr. Adelson and his family for any injury we have caused."

Adelson is a billionaire philanthropist and casino mogul who owns the Venetian and Palazzo casinos on the Las Vegas Strip.

He's also a big Republican political donor. Adelson contributed $20 million to an independent group backing former House Speaker Newt Gingrich's presidential bid and is now backing a pro-Romney group with at least another $10 million.

The Associated Press contributed to this report.