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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:

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
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
                                                (, 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.


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