| Home | Books and Gifts | Photo Album | Mob Busters | Mafia Site Search |
Inside Vegas - Steve Miller

Steve Miller is a former Las Vegas City Councilman. In 1991, the readers of the Las Vegas Review Journal voted him the "Most Effective Public Official" in Southern Nevada. Visit his website at:

Rizzolo's Parole Violation Hearing
Continued Until May 9 and 10

"Can Lion's LP assign its rights to collect the balance on
the Philly sale to Bart before somebody else seeks to
attach the payments..?" - Rizzolo attorney Mark Hafer

"I'm your silent partner that you don't have to pay."
U.S. Probation Officer Eric Christiansen

INSIDE VEGAS by Steve Miller
April 4, 2011

The United States Federal Court of Judge Philip Pro convened at 9:10 AM, March 29, 2011 in the Lloyd George Federal Courthouse in downtown Las Vegas to hear arguments from Assistant U.S. Attorney Eric Johnson as to why convicted racketeer Rick Rizzolo's parole should be extended for three years, and he be sent back to prison for (at least) three months.

Johnson told the court that the former owner of the Crazy Horse Too strip clubs in Las Vegas and Philadelphia was guilty of two violations of supervised release: not reporting new financial transactions to his probation officer; and avoiding paying his taxes and other financial obligations including the restitution of $9 million dollars to beating victim Kirk Henry.

A key document entered into evidence by the prosecutors was the following Confidential fax to political powerhouse law firm Lionel, Sawyer & Collins that may indicate a collusive scheme between Rizzolo family attorneys Mark Hafer and John Dawson to hide Rick and ex-wife Lisa Rizzolo's money from creditors and the government.

During testimony of Rizzolo's probation officer Erik Christiansen, it was revealed that Rizzolo failed to inform his P.O. of a series of payments Rizzolo received from Pennsylvania businessman Vince Piazza.

According to information discovered by Kirk Henry's attorneys and the U.S. Attorney that was later shared with Christiansen and the federal court, Piazza paid Rizzolo an initial payment of $999,000.00 in April 2008 for part of Rizzolo's interest in the Philadelphia Crazy Horse Too.

Rizzolo did not report the payment to his probation officer or the IRS according to Christiansen's testimony.

In a complex scheme to hide the Philadelphia sale proceeds, it was disclosed in court that Las Vegas attorney John Dawson at Lisa Rizzolo's behest transferred the initial $999,000.00 payment to a Southpac Offshore Planning Institute bank in the Cook Islands, then Dawson reportedly redeposited the allegedly laundered money into an LLC controlled by Rick Rizzolo. Dawson reportedly assigned those proceeds plus additional others from the Philadelphia club's sale to Rizzolo's late father Bart, and after Bart's death on March 19, 2010, assigned proceeds to Bart's widow Kim Tran Rizzolo.

The prosecution during the March 29 hearing stated that after the initial $999,000.00 payment was deposited off shore by Dawson, additional unreported monthly payments of $57,000.00 each were reportedly given the same "asset protection" treatment by Dawson who eventually assigned the moneys to Kim Tran Rizzolo with the loot probably ending up in the hands of Rick Rizzolo for his personal use.

Probation Officer Christiansen testified that he was not aware of these transactions, and that they violated an agreement Rizzolo signed upon his release from prison in April 2008 stating that any and all information regarding his financial dealings must be reported to and receive the blessings of the U.S. Office of Parole and Probation.

The agreement containing Rizzolo's signature was entered into evidence.

Christiansen testified that at least $3 million dollars in funds handled by John Dawson and ending up in Rick Rizzolo's control between April 2008 and 2010 were not reported to his office in violation of federal law.

Court records show that Lionel, Sawyer & Collins was paid a minimum of $80,000.00 for providing Dawson's asset protection skills, and for him to act as the Rizzolo's personal bank teller.

U.S. Attorney Johnson provided evidence that Rizzolo also failed to report the Philadelphia transaction on his income tax forms which is an additional violation of his terms of supervised release. However, supporting documents were not available in court last week because they are reportedly in the possession of Rizzolo's former lawyers Dean Patti and Tony Sgro.

Johnson also told the court that attorney John Dawson once wrote an email to a Lionel, Sawyer & Collins colleague stating: "Rick wants to get some money back." No further explanation was given.

This happened while Rizzolo was on parole and not supposed to be consummating financial transactions without the knowledge and approval of his probation officer.

However, Rick did get some money back while he was avoiding paying millions in back taxes; $9 million plus interest to Kirk Henry; and while he was telling the court he's "broke."

(It was not mentioned during the hearing whether John Dawson will be charged as a co-conspirator for allegedly committing the crime of intentionally hiding a client's assets from seizure by the U.S. Internal Revenue Service.)

Court records were also revealed showing that Rick Rizzolo had two Las Vegas bank accounts that were unknown to his probation officer. From one account Rizzolo reportedly paid $6,000.00 for a birthday party.

Johnson told the court that Rizzolo went "on cash basis after the IRS levied the two accounts."

Johnson explained that Rizzolo was pleading poverty in 2009, and in a deposition stated his jewelry was his only asset, and that he had "no recollection" or was under the "mistaken belief" he had reported all his financial transactions to the parole officer and the IRS even though he began receiving his additional $2 million in $57,000.00 per month payments from Piazza beginning in 2010 that he failed to report to authorities or the IRS.

Probation Officer Christiansen testified that he visited Rizzolo for the first time in April 2008 at the Roma Hills mansion (left) Rizzolo shares with Slots of Fun heir Cliff Diamond. There he reportedly told Rizzolo "I'm your silent partner that you don't have to pay." Christiansen said he clearly explained that he must be informed of every financial transaction in monthly written reports, and that Rizzolo agreed in writing to do so -- but immediately went back on his word by not reporting the $999,000.00 initial payment received by Rizzolo's family less than a week after he began his supervised release in April 2008.

Christiansen testified that during the first two years of Rizzolo's supervised release, the veteran P.O. had no knowledge of the sale of the Philadelphia Crazy Horse Too, or knowledge of any off shore accounts held by Rizzolo's ex-wife Lisa.  Rizzolo told his P.O. his only income was from a personal bank account he was draining that contained $92,000.

Christiansen continued to be steam rolled by Rizzolo for the next two years.

On February 17, 2010, Christiansen began to smell a rat and filed a REQUEST FOR HEARING TO MODIFY CONDITIONS OR TERMS OF SUPERVISION.

In the two page document, Christiansen stated: "On December 17, 2009, the offender was asked to sign a Payment Schedule for U.S. District Court Clerk in which he was requested to make monthly payments towards his restitution and fine. Mr. Rizzolo declined, stating that he would not sign the document at the advice of his attorney."

The P.O. testified that he finally requested Rizzolo's parole be modified or revoked in 2010 after being informed of the secreted assets by the U.S. Attorney and attorneys for Kirk Henry. In his request, he asked the court to send Rizzolo back to prison for three months, and to extend his term of supervised release for an additional three years. Christiansen's request was supported by the U.S. Attorney and inspired the March 29 Parole Violation Hearing.

Because so much more information is now available including new statements from witnesses on both sides including the recent deposition testimony of Vince Piazza, the March 29 hearing was only the beginning of an extensive probe that will require at least two additional days to complete.

After Judge Pro ruled there would be a continuance, Rizzolo's lead attorney Dominic Gentile told the court that he will be forced to add additional lawyers to his team who are familiar with tax fraud to challenge the government's evidence of tax evasion. It's anticipated that Rizzolo crony Fred Doumani will continue his claim that he is personally paying his friend's burgeoning legal tab, while Rick Rizzolo persists in pleading poverty, and his ex-wife Lisa divides her time between the couple's lavish estates in Las Vegas, Chicago, and Newport Beach.

Judge Pro scheduled the continuation for May 9 and 10, 2011, so the U.S. Attorney will have time to gather tax related documents. Rizzolo will be allowed to remain free until then, though several court observers were later heard asking why his passport had not been seized?

Rizzolo's "Dream Team" (top L to R): The Defendant; Attorneys Dominic Gentile, Paola Armeni and Margaret Lambrose; (bottom L to R) Rizzolo's spiritual advisor Father Dave Casaleggio; Attorneys Tony Sgro and John Dawson; and Rick Rizzolo's legal defense financier Fred Doumani.
(Photos of Rizzolo, Doumani, and Rev. Casaleggio by photographer Mike Christ)

Many of the documents that are reportedly needed by the U.S. Attorney for the May 9 and 10 hearing were once in the possession of Rizzolo's former attorneys at Patti, Sgro & Lewis. The local law firm known for defending members of organized crime has since claimed that the documents were destroyed in a "flood," but were unable to demonstrate the validity of their claim. A senior member of the same firm, Mark Hafer, authored the confidential fax to John Dawson that revealed a scheme to secretly assign the $3 million dollar proceeds from the Philadelphia Crazy Horse Too sale to Rick Rizzolo's father "before somebody else seeks to attach the payments," referring obscurely to the IRS.

And as to what happened to the rest of Rick and Lisa Rizzolo's financial records, these photos taken on April 3, 2007 by the late Buffalo Jim Barrier can be entered into evidence with my full consent (click on photos to enlarge). They were taken at Rizzolo's personal warehouse behind the Crazy Horse Too when thousands of documents were being shredded.

To the best of my knowledge, the shredding was not approved by the court or IRS.

And regarding the "flood" that purportedly destroyed more of the Rizzolo's records, here's U.S. Magistrate Judge George Foley's response:
Patti, Sgro & Lewis has, in fact, placed its credibility in issue by stating that it is unable to produce client records that it had a legal duty to retain and which one would expect an attorney to retain. Patti, Sgro & Lewis’s assertion that client records may have been destroyed in a flood was uninformative as to when the flood occurred, where it occurred and extent of records destroyed. It is reasonably incumbent on Patti, Sgro & Lewis to demonstrate the validity of its explanation that records relating to Mr. and/or Mrs. Rizzolo were or may have been destroyed in a flood. The discovery sought by Plaintiffs is therefore a reasonable follow-up to its efforts to obtain relevant records from the Rizzolos’ attorneys. Patti, Sgro & Lewis has not demonstrated that it will incur a substantial burden and expense to locate and produce records relating to a flood which apparently occurred within the past several years. 

Motion to Compel - #129 - ORDER delivered by George Foley, Jr., United States Magistrate Judge, June 30, 2009 

To the present day, no court record has been entered proving Patti, Sro & Lewis complied with Magistrate Foley's ORDER by demonstrating the validity of their claim Rizzolo's records were destroyed in a "flood." And the politically connected firm has miraculously escaped being sanctioned for their noncompliance with Foley's ORDER, or for their conspiring with John Dawson to assign Vince Piazza's payments to Rizzolo's late father or his widow.


Judge Pro will be bound on May 9 and 10 to follow these guidelines regarding the possible punishment Rick Rizzolo may receive for allegedly violating his terms of supervised release.

(Beginning on Page 38) 

C. Modification, Early Termination, and Revocation of Supervised Release
Depending on the circumstances, courts have the authority to modify the conditions of an offender’s supervised release, to terminate it before the original expiration date, or to revoke supervised release and return an offender to prison (emphasis added)

3. Revocation and Sentencing Proceedings
a. Procedural Issues Related to Revocation Proceedings
If the government or a probation officer supervising an offender believes that the defendant has violated one or more conditions of supervised release, the government or the probation officer is authorized to file with the court a petition to revoke supervised release; the petition need not be filed by an attorney for the government. The petition serves as the “written notice of the alleged violation” of the conditions of the defendant’s supervised release. In response to the petition, a court may issue a summons (emphasis added - Rizzolo received his summons during his term of supervised release) or an arrest warrant.

At the revocation hearing, the offender possesses several rights: the right to be present, the right to counsel, the right to disclosure of the evidence upon which the government is relying in seeking revocation of supervision or modification of its terms, the opportunity to be heard and present witnesses and documentary evidence, a limited right to confront and cross-examine adverse witnesses, and the right to a written statement by the court as to the evidence relied on and the reasons for the revocation. At the revocation hearing, the government — typically represented by an assistant United States attorney — bears the burden of proving an alleged violation by a preponderance of evidence.

The court may . . . revoke the term of supervised release, and require the defendant to serve in prison all or part of the term of supervised release authorized by statute for the offense that resulted in such term of supervised release without credit for time previously served on post release supervision (emphasis added), revocation after the term of supervised release has ended can be based on any violation during the term, even if that ground was not specifically listed in the petition to revoke filed during the term, as long as a warrant or summons was issued during the term on the basis of some alleged violation (emphasis added - Rizzolo's supervised release was set to expire on April 3, 2011, but the current court action has extended it past May 10).

If this judgment imposes a fine or restitution, it is a condition of supervised release that the defendant pay in accordance with the Schedule of Payments sheet of this judgment (emphasis added - After being released, Rizzolo refused to pay any fine or restitution bargained for in his plea agreement).

According to Page 59 of the guidelines (excerpt below), Rick Rizzolo got off real easy.

According the guidelines, Rizzolo should have received an Average Prison Term of 23 months. Instead, he received only 10 months in prison and 2 months in a halfway house in exchange for his promise to pay all his bills. In the meantime, almost ten years after Sept. 20, 2001 when Kirk Henry was rendered a quadriplegic at the hands of one of the Rizzolo's employees over a disputed $88 bar tab, Henry remains unpaid while his medical and legal bills continue to mount.

Las Vegas Review-Journal investigative reporter Jeff German covered the March 29 hearing. Here is a LINK to his comprehensive story "Prosecutors want to send former strip club boss back to prison" that includes an excellent courtroom illustration by RJ artist David Stroud.

In the blog at the bottom of the story, Review-Journal readers shared their thoughts. This reader said it best:
Lawyer wrote on March 29, 2011 09:54 PM: 

Probation is a privilege, not a right. In reality, a.k.a. when you are defending a young black man who has been in the bucket for a few years for hawking a crack rock, he does not get a formal hearing with IRS Agents and one of the best attorneys in town. Dominic Gentile probably earns 750 an hour for defending Rizzolo. In reality, a young hoodlum gets a report from P & P and a one way ticket to High Desert (prison). It is obvious that Rizzolo is up to no good and hiding money, as such he should go back to the joint. Max Tanner served EIGHT years for tax evasion, he was a lawyer with no priors who set up shell corporations and sold stock for these shell corporations. His thugs never paralyzed a man over a bar tab . . . there are some serious shenanigans afoot.

Four agents from the Internal Revenue Service took extensive notes during the March 29 hearing and are expected to be in court again on May 9 and 10, as will

During the next few months, additional indictments may be filed possibly including one against Lisa Rizzolo.

John Dawson's name has also been mentioned.

This story is far from over.

* If you would like to receive Steve's frequent E-Briefs about Las Vegas' scandals, click here: Steve Miller's Las Vegas E-Briefs

Copyright © Steve Miller

email Steve Miller at:
div. of PLR International

Copyright © 1998 - 2011 PLR International