Keep in mind
that most cab and limo drivers in Vegas are moral law abiding citizens.
However, in most other states these same drivers can own their own cabs
or limos and compete with the largest of transportation companies. In Nevada
and only two other states, an unconstitutional "Adverse Impact Law" exist
that allows competing transportation businesses to "intervene" when a new
application comes forward, and argue that the newbie will cut into their
bottom line. In all cases I've studied, the existing limo and taxi operators
prevailed, and no new companies were allowed.
Meanwhile, the extortion demand is now topping $100 per
passenger delivered to local strip clubs, and one club has reportedly begun
paying drivers $120 per patron!
What's most amazing is that the Internal Revenue Service
has been aware of the racket for over 19 months -- and has done nothing.
The following letter was sent via U.S. Certified Mail
on September 5, 2007, and its delivery receipt was signed by an employee
of the IRS Fraud Division two days later.
The writer states that he has not been contacted or received
a written response from the IRS, therefore, he recently requested that
a redacted copy of his letter be made public in hope its dissemination
will eventually inspire an investigation.
Sources report that the purported owner of Bada Bing men's
club also manages the doormen at several MGM resorts, and those doormen
are instructed to only recommend his topless bar to MGM casino patrons.
The man's godfather is former Crazy Horse Too owner and
convicted racketeer Rick
Rizzolo who is known as a "whale" in MGM casinos. Rizzolo's now-shuttered
topless bar was allegedly the first to benefit from his godson's doorman/limo
driver scam. Rizzolo's plea bargain stipulates that he not have an interest
in any adult business for the rest of his life, but sources say he's a
hidden owner in Bada Bing.
The same sources allege that the godson is a silent partner
in a local limo company, and MGM doormen allegedly let his vehicles cut
in front of others waiting in line for fares, especially if the fare requests
a ride to a strip club. When in the vehicle, the driver reportedly tries
to divert passengers to Bada Bing and other adult businesses including
massage parlor brothels and swinger's clubs that allegedly pay $100
per passenger. The MGM doorman allegedly receives a cut from the driver
that he shares with Rizzolo's godson who is benefiting both ways, while
he and his doormen's bosses at the MGM apparently know nothing of the scam,
and the marks are overcharged at the adult venues they're encouraged to
patronize by unscrupulous doormen and drivers.
For years the politically appointed commissioners on the
Nevada Taxicab Authority (TA)
and Nevada Transportation Authority (NTA)
have been accused of looking the other way and letting the practice
continue unabated to the detriment of our tourism industry and the discouragement
of new business ventures.
However, the following coverage by my colleagues John
L. Smith and George Knapp may indicate that the illegal practices are about
to finally become of interest to the IRS and the unaware casino
owners.
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Apr. 01, 2009
Copyright © Las Vegas Review-Journal
JOHN L. SMITH: Las Vegas strip clubs waging high-stakes
cash-for-customers war
http://www.lvrj.com/news/42251762.html
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Apr. 03, 2009
Copyright © Las Vegas Review-Journal
JOHN L. SMITH: Topless clubs take the gloves off to fight
for business during recession
http://www.lvrj.com/news/42378582.html
----------------------------------------------------------------------
Investigative Reporter George Knapp and Photojournalist
Matt Adams
I-Team: Cabbie Kickback Fight Going to the Airwaves
KLAS TV News
April 9, 2009
http://www.lasvegasnow.com/Global/story.asp?S=10160990
Streaming Video:
http://www.lasvegasnow.com/Global/category.asp?C=28259&nav=menu102_5&clipId=3629890
----------------------------------------------------------------------
Apr. 10, 2009
Copyright © Las Vegas Review-Journal
JOHN L. SMITH: Attorney spearheads movement to stop kickbacks
for strip club clientele
http://www.lvrj.com/news/42792447.html
----------------------------------------------------------------------
PREVIOUS INSIDE VEGAS COLUMNS ON THIS SUBJECT:
The New - Old Racket
INSIDE VEGAS by Steve Miller
AmericanMafia.com
October 23, 2002
FULL COLUMN: http://www.americanmafia.com/Inside_Vegas/10-28-02_Inside_Vegas.html
----------------------------------------------------------------------
Sin City Cabbie Conspiracy Worsens
The tail is wagging the dog with government help!
INSIDE VEGAS by Steve Miller
AmericanMafia.com
October 24, 2005
"We've taken in excess of 50 rides, and one out of five
rides that we take, we offered the opportunity for the driver, and they
attempted or diverted us to a specific location." - Former Nevada
Taxi Authority (TA) Administrator John Plunkett
FULL COLUMN: http://www.americanmafia.com/Inside_Vegas/10-24-05_Inside_Vegas.html
----------------------------------------------------------------------
Nevada legalizes extortion
INSIDE VEGAS by Steve Miller
AmeicanMafia.com
February 12, 2007
FULL COLUMN: http://www.americanmafia.com/Inside_Vegas/2-12-07_Inside_Vegas.html
----------------------------------------------------------------------
FROM MY LAS VEGAS READERS:
Steve: I think
one part of the story you should also include is that one topless club
owner even owns a taxi cab company to try and combat the diverting of customers
and he more than likely had hopes that his drivers would have some loyalty
to his club when deciding what topless club to recommend to passengers.
Unfortunately for him, his drivers are more loyal to the payouts offered
by other strip clubs and will even divert customers wanting to go to his
club if they can get a bigger payout somewhere else-----and not get caught.
Also the reason
you see such long lines of cabs at strip clubs is because they know most
customers go from one strip club to another, allowing them to repeatedly
get the payoffs. Why would a taxi driver take a call from dispatch
to get a $15 fare when he can sit at a strip club for an hour or so and
have a 50-50 chance of getting another couple hundred for a strip club
run.
This town lives
on payoffs, crooked police to help with the coverups, and bribed politicians.
It won't be changing anytime soon. - Mel
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Hi Steve,
The biggest
incentives to these limo and taxi drivers is that the clubs can supply
drugs to offer to their passengers.
Last month
I met up with a woman friend at Ceasars... She asked the doorman for a
limo. When we got in the limo, the Chinese driver who could hardly speak
English, right off offered us "eight ball for $400." That is close
to a $250 to $300 profit for him!. That's Nuts! - Jasper
----------------------------------------------------------------------
Steve: You
should write an article about how $40M-$200M is being diverted illegally
off the Strip by Arabic and Pakistani cab drivers. As the backbone of Nevada,
the major Strip casinos are going bankrupt and broke. That money is desperately
needed by the casinos during this recession. I understand Rick's Cabaret
is now paying $120/head and charging $20 for a beer. I believe that the
casinos need to plead their case to the transportation commissioners because
the casinos will ultimately be the losers in this game as more revenue
is taken from them. This is unheard of (major kickbacks happening in the
open without punishment) in any major city in the United States. - Lou
----------------------------------------------------------------------
MY RESPONSE:
As a fifty year Las Vegan, I can only ask, "What is this
town becoming?" - SM
Editor's note: Steve Miller is a former Clark County Regional
Transportation Commissioner
