INSIDE VEGAS by Steve Miller
AmericanMafia.com
June 13, 2011

LAS VEGAS - On Friday, July 1, at 1 PM, a fire sale will take place. To be sold to the highest bidder are the picked over remains of what was once Sin City's most profitable topless bar, the Crazy Horse Too. Ironically, July 1 is exactly four years to the day that the Crazy Horse Too was shut down after years of robbing and beating its patrons.

At the sale to be held on the steps of the Las Vegas Legal News located at 930 South 4th Street in downtown Las Vegas, it's expected that Federal Agents, LV Police Organized Crime Bureau officers, news reporters, and photographers will outnumber bidders by at least two to one.

The 2.6 acres of Industrial Road land is expected to fetch no more than $1 million based on structural damage caused by years of water and sewer leaks that undermined the foundation of the converted warehouse, the depressed local commercial real estate market, and the Nevada Department of Transportation's plan to take by eminent domain a 25 foot deep slice of the property's frontage for a road widening sometime within the next few years.

The sale is based on a very questionable $5 million dollar loan issued in 2005 by the now-defunct Security Pacific Bank of California that was secured by the Crazy Horse Too property and never repaid. At the time, former owner Rick Rizzolo was within a year of being indicted for racketeering, and his property was within two years of being seized by the U.S. Department of Justice. However, though the bank was clearly forewarned of the tenuous condition of their collateral, they proceeded to fund the loan.

Immediately upon receipt of the $5 million, Rick Rizzolo's ex-wife with the help of attorney John Dawson, brother of Federal Court Judge Kent Dawson, hid the money in the Cook Islands out of reach of the bank, FDIC, IRS, and un-paid beating victim Kirk Henry who was/is the Plaintiff in a highly publicized personal injury lawsuit against Rizzolo and his corporation "The Power Company" at the time Security Pacific Bank funded the loan.

Because I provided ample information to the bank about Rizzolo's pending indictment and the club's pending seizure, and the fact that they chose to ignore it and still gave Rick and Lisa Rizzolo the $5 million, it's now speculated that one or more bank officers were bribed.
   
(Click HERE to see the exact August 2005 "email string" Security Pacific Bank officials ignored. If the page does not appear within ten seconds, click "Impatient?")

Three years after Rick and Lisa Rizzolo stole the $5 million, Security Pacific Bank went belly up, and the FDIC (taxpayers) were forced to bail out the bank's depositors.

Following the bank's demise, the FBI clearly described the fraud Rick and Lisa Rizzolo committed against Security Pacific Bank in this DECLARATION authored by Special Agent Anthony J. Mace:

"On October 26, 2005, RIZZOLO signed a $5,000,000.00 in United States currency note which was secured against the underlying real property on November 3, 2005. The FBI has not been able to track or locate the $5,000,000.00 in United States currency." "Upon due diligence, I have tried to locate all property of RIZZOLO. I have not been able to find any other personal or real property of significant value to satisfy debts owed to the United States and victim."

It was later discovered by attorneys for Kirk Henry that the Rizzolo's, through their "Protector" John Dawson (left), hid the bank's money in the Cook Islands. (So far, Dawson has not been charged with a crime though his personal attorney attends all hearings in Federal Court that involve the Rizzolos.)

Keep in mind that a duped bank, and later the guy who bought their phony collateral should have never been assigned a payment position in advance of Kirk Henry, but it unexplainably occurred. Based on what is expected to be garnered at the auction, and because Henry is in fifth position to get paid, no one expects that any of the fire sale proceeds will go to help Henry pay his life long medical expenses.

Now, after six years and millions of dollars lost by U.S. taxpayers, an unknown person bought Security Pacific Bank's bad paper including the Rizzolo's collateral for pennies on the dollar, and on July 1, intends to auction the Crazy Horse Too off to the highest bidder no matter whether or not that bidder has connections to Rick and Lisa Rizzolo.
   
One of INSIDE VEGAS' most reliable confidential sources put it this way:

"Steve: The actions of Security Pacific Bank could have been Rizzolo's plan all along.  He could buy the Crazy Horse back through a strawbuyer with the bank's money. There are several standing by with close ties to Rizzolo, et. al., including two men with real estate holdings on the LV Strip. This way Rizzolo gets it back for free.  Up until this point everything Rizzolo has done, except for sitting in the can for a few months, which is a small price to pay for the pay back, has paid off in spades for him.  He gets the money to buy the place from the same people that foreclosed on it. Then pays back the strawbuyer with his hidden 5 mil.  How beautiful -- if the judge goes along.  You have to give Rick credit for this scam.  Thinking about it, someone at the bank really could have been in on the scam from the get go.  Perfect way to wash his money. He gets the money from the bank with no intention of paying it back knowing that he was going to lose his license to operate the CH2.  Bank takes building. All is good for Rizzolo.  Now Rizzolo claims poverty and does not have to pay all the rest that he owes.  While he still has all of his money that can't be touched thanks to a FEDERAL JUDGE'S brother who hid his assets.  Pretty damn smart of him.  He beats everyone and spends a few months in lock-up.  His Chicago friends taught him well the art of the bust out."

AmericanMafia.com will be at the fire sale on July 1.

It has been falsely reported that the adult use zoning once grandfathered for Rick Rizzolo cannot be re-instituted and the property can never return to being a topless bar because there is another adult use located within 1,500 feet.

As a former Las Vegas City Councilman, I will attest that it would be a simple task for a new Mayor to change the present zoning ordinance to allow more than one adult use to exist within 1,500 feet of another. She could simply convince her City Council to vote to change the distance requirement to 1,000 foot separation, and the new owners of the Crazy Horse Too can apply for a new liquor license and resume business.

Last Tuesday, Las Vegas elected a new Mayor. Her name is Carolyn Goodman, wife of outgoing mayor and Rick Rizzolo's former criminal defense lawyer and corporate agent Oscar Goodman (AP Photo by Isaac Brekken).

However, former LV Mayor Oscar Goodman still has friends in City Hall. There are those who think the ex-Mayor might try to influence his wife into introducing an ordinance repealing CLV 19.16.030 (3) to re-zone the Crazy Horse Too property back to adult use as a favor to Rizzolo or one of his associates with ties to Oscar Goodman's law firm. If so, Oscar Goodman would have nothing to lose since he has retired from politics, and his wife is enjoying the traditional political honeymoon temporarily experienced by those who win elections by a landslide.

A new Mayor in the beginning of her first term is usually given at least one pass to do something foolish, and Carolyn may want to do a favor for several of her husband's most prolific former clients. Rick Rizzolo is prohibited by his plea agreement from being associated with another adult business for the rest of his life, but Rick deals in cash, and Vegas topless bars are known for being cash cows, so no one would know if he slipped back into the business.

In 2006, after writing about Oscar Goodman using his office to do Rizzolo favors such as sponsoring an ordinance to let the Crazy Horse expand, and another allowing it to employ teenage strippers, I personally filed an ethics complaint that temporarily stopped Oscar Goodman in his tracks.

In response to the complaint, Goodman (giving a menacing glare to AmericanMafia.com photographer Mike Christ) defiantly told the Las Vegas Review-Journal; "Tell Steve Miller he can suck my big toe," but he also was forced to abstain on all matters involving Rizzolo for the next two years.

During that time, the Crazy Horse Too was closed down permanently by the non-conflicted members of the City Council.

Oscar and Carolyn Goodman are a study in contrasts. Oscar's bad boy image was accurately portrayed in the movie "Casino," while Carolyn's previous image was that of a devoted educator and Chairwoman of the Board of Directors of the Meadows School, a private school in Summerlin that charges tuition of $11,200 - $14,950 per year per student depending on grade level.

"The Meadows School strives to reinforce traditional values and emphasize the cultivation of integrity, good manners, and personal discipline." -  Excerpt from the Objectives of the Meadows School.

Will Mayor Carolyn Goodman continue to reinforce traditional values, cultivate integrity, good manners, and personal discipline?

Or will she re-zone and re-license a menace to "provide jobs for hundreds of single mothers," "help revitalize the area," or some other reason if one of Rizzolo's associates makes a proxy winning bid on July 1?

In any case, Kirk Henry will not get a dime as he is in fifth position behind the U.S. Marshals, Clark County, City of Las Vegas, and the bank trustee.

The seller (trustee) gets to keep anything under $5 million. Proceeds over that amount would need to be dispersed to the creditors who are ahead of Henry, and it's not expected that anyone will bid anywhere close to $5 million unless they secretly know the new Mayor will give them zoning and a new liquor license to reopen as a strip club.

And why hasn't Kirk Henry, the IRS, City of Las Vegas, or other creditors filed a Lien Lis Pendens on the property?

Here is the list of those who have made claim to the Crazy Horse Too property in the order of priority given them by U.S. Judge Philip Pro:
 

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

A Lien Lis Pendens is a written notice that a lawsuit has been filed which clouds the title to real property or some interest in that real property. It gives notice to the entity that owns the real estate that there is a claim on the property, and informs the general public, and anyone interested in buying or financing the property, that there is this potential claim against it.

I wish our new Mayor the best, and I give her the benefit of the doubt that she'll do the right thing. However, her husband has proven time and again that his friendships with former criminal defense clients can overshadow his loyalty to constituents. That said, after Friday, July 1, when a new owner takes possession of the Crazy Horse Too, if soon thereafter an application for new adult use zoning appears on the City Council agenda, I will hate to be the one who says "I told you so."