INSIDE VEGAS by Steve Miller
AmericanMafia.com
December 6, 2010

LAS VEGAS -  They're making their list and checking it twice!

On Friday, December 3, the United States Attorney for Nevada filed a RESPONSE in Federal Court asking that convicted Vegas racket boss Rick Rizzolo be forced to honor the conditions of his parole. The document mirrors many details INSIDE VEGAS reported on November 15 and November 22 in response to Rizzolo's repeated requests to have the Government's and beating victim Kirk Henry's cases summarily dismissed.

Since the Government's June 30, 2007 anticlimactic closure of Rizzolo's former Crazy Horse Too strip club in Vegas, over $27 million dollars in court ordered debts have gone unpaid. Rick Rizzolo agreed to pay these debts in exchange for an abbreviated prison sentence.

Here's a copy of the Government's Rizzolo Family Christmas List:
 

1. 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.;  2. The Clark County Taxes owed on the Property with penalties and interest 3. The City of Las Vegas sewer lien  4. The Security Pacific Bank ($5 million dollar) loan with attorneys' fees, penalties, and interest 5. The restitution of US $9,000,000.00 plus interest to Kirk and Amy Henry  6. The restitution of US $1,734,000.00 plus accruals to the IRS  7. The assessment of US $500.00 plus interest  8. The fines of US $750,000.00 plus interest  9. The forfeiture of US $4,250,000.00 plus interest  10. The City of Las Vegas judgment lien of US $2,192,000.00 plus interest  11. The IRS tax lien against Rizzolo for the 2006 individual income taxes of US $1,032,535.26 plus accruals

And here's the reasons the Government gives for not being paid:

"Defendant failed to sell the club within the one year period that he was provided after his plea, choosing instead to engage in a management agreement and sham or reckless sale of the club to Michael Signorelli. Signorelli, on taking over the club, subsequently mismanaged the business to the point where neither the Government nor defendant could find a qualified third party operator willing to manage the club without a multi-year contract which would have delayed any sale of the club. The Government moved for substitute forfeiture of the property and then, after the forfeiture, attempted to sell the property to multiple purchasers, all who failed to ever put significant real money down on the property."

"Defendant is spending lavish amounts in various restaurant and entertainment establishments, hiding substantial funds offshore, disposing of expensive assets to family members and friends and claiming falsely that he is a man of very limited means in responding to all efforts to identify assets potentially attachable for meeting his obligations."

"...defendant's admitted efforts to place other assets beyond the reach of third parties to whom he owes restitution, requires action now to ensure that defendant does not escape his legal obligations. Consequently, the Government's planned debtor examination of defendant Rizzolo scheduled for December 17, 2010, is not premature and should not be vacated." - DANIEL G. BOGDEN, United States Attorney, December 3, 2010

It's entirely possible that on December 17, Nevada Federal Judge Philip Pro will follow the lead of a federal judge for the District of Minnesota who on January 25, 2010 ordered a fraudster be incarcerated until he surrenders millions of dollars he stashed in offshore accounts to avoid paying court ordered debts.

According to a U.S. Government press release, "Chief Judge Michael J. Davis found (Trevor G.) Cook in civil contempt and U.S. Marshals escorted Cook from the courtroom to jail. Chief Judge Davis ordered that Cook remain in jail until he is in compliance with the court's orders."

Cook did not comply with the court orders and subsequently was sentenced to 25 years in the Federal Penitentiary.

Rick Rizzolo with the help of his ex-wife and an asset protection attorney who is the brother of a federal court judge, also transferred most of his assets off shore to avoid his legal obligations. It's not yet been determined whether Rick's ex-wife Lisa Rizzolo will be charged for her part in what has been described as a "sham divorce" obviously designed to avoid paying creditors including Kirk Henry and the IRS.

According to U.S. Attorney Bogged: "On April 26, 2010, the Court considered a request by the United States Probation Office to modify defendant Rizzolo's conditions of supervised release to require defendant to begin making monthly payments toward the restitution owed to the Henrys."

The court approved the request stating: "Mr. Rizzolo shall provide to the probation officer the financial information requested and shall commence paying the restitution obligations at a rate to be approved by the Court." - U.S. Judge Philip Pro, April 26, 2010

Based on the April 26 ORDER, Bogden wrote: "Defendant in depositions has admitted that his conduct is designed to avoid meeting his obligations to the Henrys and liabilities to other third parties, including the Internal Revenue Service. Consequently, this Court's modification of defendant's conditions was a reasonable response to force defendant to begin to meet his financial obligations to the victims of his club's crime."

"Modifying his conditions also helped the Henrys meet obvious significant financial needs resulting from the criminal injury done to Kirk Henry and forced Rizzolo to begin to appreciate the need to meet rather than avoid his legal obligations. Finally, modifying defendant's conditions in view of the damages in this case promoted public respect for the law generally," Bogden wrote on April 26.

However, over seven months later, Bogden's words have proven to be wishful thinking because Rizzolo (under the mistletoe) has failed to comply with any part of Judge Pro's ORDER, and Kirk Henry, a quadriplegic, and his family are forced to struggle financially through another bleak Christmas season unsure of whether they will ever be compensated for Kirk's injuries.
                           
Rizzolo's failure to comply with the modification of his conditions of parole made Bogden's statement; "promoted public respect for the law generally," appear totally meaningless.

It's been almost eight years since the February 21, 2003 FBI raid on the Crazy Horse Too. If eight years of litigation is any example of promoting "public respect for the law generally," our system of justice in Nevada is seriously flawed!

A tragedy occurred on September 20, 2001 when one of Rick Rizzolo's goons broke Kirk Henry's neck over a disputed $80 bar tab. This violent event along with many others inspired the United States Department of Justice to investigate Rizzolo and his business resulting in the felony convictions of Rizzolo and fifteen of his associates along with the closure of the Crazy Horse Too and Rizzolo's agreement to pay the $27 million in court ordered debts in exchange for a joke of a prison sentence.

Mr. Henry has waited over five years to receive his restitution but is yet to receive one penny from Rizzolo's personal fortune (Rizzolo's Farmer's Insurance policy paid the Henrys $1 million in 2002). In the meantime, the convicted racketeer is making a mockery of the Nevada Federal Court and the Internal Revenue Service.

After all this time, I sincerely hope that at the upcoming Judgment Debtor Exam, U.S. Attorney Bogden will be successful in convincing Judge Pro to order Rick and Lisa Rizzolo to repatriate their off shore fortune back to the United States to pay Rick's moral and legal obligations, or send him back to jail until he does.

Court calendar changes notwithstanding, INSIDE VEGAS will be present at 9 AM, December 17 in Courtroom 3-B of the Lloyd D. George Federal District Courthouse in Las Vegas, and will publish the outcome December 20 on AmericanMafia.com.

POST SCRIPT

As of December 6, 2010, the Judgment Debtor Exam of Rick Rizzolo has been postponed temporarily to a new date not yet set by the U.S. Federal Court. INSIDE VEGAS will inform readers of the new date in a future column.

Click HERE to read the Government's full 9 page RESPONSE IN OPPOSITION TO DEFENDANT RIZZOLO'S (1) REQUEST TO VACATE JUDGMENT DEBTOR EXAMINATION; 2) MOTION TO REQUIRE THE GOVERNMENT TO SPECIFICALLY PERFORM THE TERMS OF THE PLEA AGREEMENT; and 3) REQUEST TO STRIKE THE ILLEGAL MODIFICATION OF SENTENCE

Have a joyful Holiday Season!