Judge
orders Rick Rizzolo's financials be shown
to Kirk Henry's attorneys,
but taxpayers are
excluded from seeing the
documents
INSIDE VEGAS by Steve Miller
AmericanMafia.com
December 14, 2009
LAS VEGAS - United States Magistrate Judge
George Foley on December 10th, ordered that the U.S. Department of Parole
and Probation's Presentence Investigation Report and Supervisory Records
on racketeer
Rick Rizzolo be shown to attorneys for unpaid beating victim Kirk
Henry, but that the documents be sealed from public view or scrutiny
by the IRS and other government agencies.
To try to prevent the above Order, on October
18, Rizzolo's attorney filed an Opposition
asking the court to prohibit Henry's attorneys from obtaining Rizzolo's
records from the parole and probation office. He claimed such information
has "a strong presumption of confidentiality," and may be of interest to
the news media.
Amazingly, Rizzolo's parole officer Eric
Christiansen supported Rizzolo's position thereby requiring Henry to expend
even more money to file a Motion to get the information.
"...the Plaintiffs agreed to payment of
restitution through a global Settlement Agreement executed in 2006. The
payment becomes due at the time of the sale of the Crazy Horse Too by the
Government. Should the sale thereof result in a shortfall and
payment of less than the entire amount, then, and only then, does Defendant
RICK RIZZOLO, become personally obligated for the balance after the
shortfall," according
to Rick Rizzolo's attorney.
It's
almost 2010, and the Crazy Horse Too has not sold. There are no legitimate
buyers on the horizon willing to pay enough to cover the Rizzolo's over
$27 million dollars in court ordered debts (see list below).
Meanwhile, last summer the FDIC auctioned
off the Crazy Horse property's $5 million dollar first mortgage issued
by the failed
Security Pacific Bank. It was purchased at a substantial discount by
a group controlled by San Francisco developer Luke Brugnara (left) who
told INSIDE VEGAS that he will foreclose on the property just after the
first of the year. When he does, a "sale" will have taken place, and there
definitely will be a "shortfall." Afterward, Kirk Henry, the IRS, and other
creditors will still be waiting for their money, and the time will come
for the U.S. Federal Court and the IRS to go after the Rizzolo's off shore
hidden assets to pay for the "shortfall."
If the Rizzolos refuse to cooperate in
bringing their fortune back into the U.S. for forfeiture, they may both
be criminally prosecuted.
Now that Judge Foley has the parole and
probation financial documents, they should indicate where the convicted
racketeer and his ex-wife are currently getting their funds while their
creditors go unpaid (see creditor list below).
All of the United States Marshals Service's costs, expenses, and
private counsel's attorney fees for the real property transaction related
to the care and the sale of the Property and the Trademark and Trade name
Crazy Horse Too, including but not limited to the maintenance, the protection,
the repair, the service of process, the publication, the utilities, the
insurance, the CB Richard Ellis real estate commission, the escrow, the
closing costs, the real estate transfer tax, private counsel's attorney
fees for the real property transaction, etc.;
The Clark County Taxes owed on the Property with penalties and interest
The City of Las Vegas sewer lien
The Security Pacific Bank ($5 million dollar) loan with attorneys'
fees, penalties, and interest
The restitution of US $9,000,000.00 plus interest to Kirk and Amy Henry
The restitution of US $1,734,000.00 plus accruals to the IRS
The assessment of US $500.00 plus interest
The fines of US $750,000.00 plus interest
The forfeiture of US $4,250,000.00 plus interest
The City of Las Vegas judgment lien of US $2,192,000.00 plus interest
The IRS tax lien against Rizzolo for the 2006 individual income
taxes of US $1,032,535.26 plus accruals |
Debts listed in bold are owed to
the taxpayers -- total: $9,958,535.00 not including penalties, interest,
and U.S. Marshals Service costs. The Rizzolos owe Kirk Henry $9 million
more.
In 2006, Rick Rizzolo agreed to pay the
above court ordered debts in exchange for a light prison sentence, and
to keep his father,
brother,
and sister
from being prosecuted for racketeering. The government kept its part of
the bargain, Rizzolo didn't!
Anticipating being convicted, in 2005,
Rizzolo transferred all his wealth to his ex-wife Lisa, a woman to whom
he was married during the time of his criminal activities. She then transferred
her and her ex-husbands assets to a bank in the Cook Islands.
Henry's attorneys contend that the transfer
of assets was a willful violation of the Uniform
Fraudulent Transfers Act (UFTA).
To bolster their contention, Nevada is
one of eleven community
property states.
These states generally regard all property
that was acquired during the marriage as community property, other than
a gift or inheritance. Even if one spouse earns all the money to acquire
the property, all the property acquired during the marriage is considered
to be community property. Nevada has special laws that operate on the theory
that both spouses contribute equally to the marriage; thus all property
acquired during the marriage is the result of their combined efforts. In
community property jurisdictions, spouses equally own all community property,
and equally share debts acquired during the term of their marriage. Kirk
Heney's neck was broken in 2001 while Rick and Lisa were husband and wife.
The Crazy Horse Too was involved in criminal activities until it was closed
by the City of Las Vegas in July 2007. Most of the crimes committed at
the topless bar occurred prior to the Rizzolo's divorce and during the
term of their marriage.
Rick Rizzolo made the majority of his fortune
by racketeering.
During Rick's hey day, Lisa, Rick, their two children, and other family
members including Rick's dad, brother, and sister enjoyed a privileged
lifestyle paid for by the family's criminal
activities. It's not as though Lisa was unaware of how her husband
made his money! Now the couple -- and their cronies -- are doing everything
they can to try to keep their fortune out of the hands of Henry and the
taxpayers including violating Rick's plea bargain agreement.
The
Las
Vegas Sun Editorial of August 21, 2007 asserted that the Rizzolo's
divorce was a "sham."
If the divorce was a violation of the UFTA,
what
kind of judge would have allowed Rick Rizzolo to transfer most of his
criminally derived assets to his wife three weeks before he was to begin
plea negotiations?
The Honorable
Steven E. Jones (shown in this June 2006 mug shot after his arrest
for domestic violence).
Rick and Lisa in their court filings often
times refer to their "lawful divorce in the state of Nevada," thereby inferring
that Clark County Family Court Judge Jones was a legitimate arbiter who
divided their assets equally believing the couple was not involved in perpetuating
a fraud.
You be the judge...
Soon after the questionable
divorce, Lisa mortgaged
their three houses to the max, then hired the brother
of a Federal Court Judge to transfer all her and her ex-husband's cash
to off shore accounts out of the reach of Kirk Henry, the IRS, and other
creditors.
Several of the banks that foolishly loaned
Lisa money have since been bailed
out by the government.
Why would anyone transfer all their wealth
to a foreign country unless they were trying to avoid complying with the
laws of the country in which they live?
The government kept their side of the bargain
and let Rick off with less than a year in federal prison, but Rizzolo welched
on his end of the deal. Since his release in April 2008, Rick and Lisa
have not paid one cent to their creditors while well connected attorney
John
Dawson of Lionel
Sawyer and Collins (LS&C) helped them hide their cash, and Dawson
has not yet faced scrutiny by the media or U.S. Department of Justice for
obviously aiding and abetting a fraudulent transfer.
In
addition to John Dawson, LS&C employs two sons of U.S. Senate Majority
Leader Harry Reid. Attorney Rory Reid
is running for Nevada Governor. His father Harry is desperately running
for re-election to the U.S. Senate. Between the two Reids, over $20 million
dollars has been raised so far to pay for political ads to run within the
state.
Another reason why this story is being
under reported is that Senator Reid appointed John Dawson's brother Kent
to the Federal Bench for life. Kent did not disclose his brother's involvement
with the Rizzolos during the trials of 15 Crazy Horse Too employees who
all got off with slaps on the wrist in his court.
With so much advertising revenue at stake,
and the probability of embarrassing the Reids at a time when they're about
to fill the local media's advertising coffers, the local media is reluctant
to cover this story.
Unfortunately, because the IRS and other
government creditors are not parties in Mr. Henry's personal injury case,
government officials (other than Judge Foley) may never see the documents
now in the possession of the court.
In order to obtain the tightly held records,
Judge Foley was forced to agree that the information was best not
shown to the public though Rick and Lisa owe the taxpayers in excess of
ten million dollars. Therefore the public has a major stake in this case
and has the right to know all the financial details.
So far, the only information the public
has as to the whereabouts of Rick and Lisa's ill-gotten
fortune is contained in Lisa's
Deposition, and last Tuesday, her attorneys filed their third
Motion to try to keep this information from being examined by the taxpayers.
Can Judge Foley -- after agreeing to seal
the Parole Department's records -- now refuse to share the information
with the IRS and U.S. Department of Justice, while Rick and Lisa continue
to enjoy the lavish lifestyle to which they've become accustomed; a lifestyle
financed with money derived from criminal activities?
.
Rick
Rizzolo parties with Elias Ghanem in a $3,000 per night Body English
booth, while beating victim
Kirk Henry waits in an electric
wheelchair for his $9 million dollar settlement
(AmericanMafia.com, and KVBC TV News photos)
Is this case taking so long to resolve
based on who the Rizzolos chose to hide their assets and the law firm he
represents? Or is it the fact that their asset protection attorney's brother
is a Federal Judge appointed by Senator
Reid who is a business partner of Jay Brown, one of Rick Rizzolo's
former attorneys?
I can't help but wonder what the Federal
Court and Internal Revenue Servoce would do to me if I were in Rick Rizzolo's
shoes and did not have the help of some of the characters listed above?
With each passing week, it seems
we might be getting closer to the resolution of this case, but it's taking
much too long! The main concern of INSIDE VEGAS readers is the kind
of precedent this case is setting if allowed to continue.
I hope that my persistence in reporting
every minute detail of this prolonged agony will serve to let those in
authority at the Federal Court and IRS know that this case is not going
unnoticed; that it's years-long duration represents a major flaw in our
criminal justice system. If allowed to continue unresolved, Rick and Lisa
Rizzolo will have clearly proven that if you know the right people, and
you have the cash, you can stall justice until your adversaries either
pass away, or give up.
MERRY CHRISTMAS!
