|EMBATTLED MAYOR ELECT RICHARD THOMAS AND|
MOB CONNECTED ADVISOR
Today at 3P.M. Mayor Elect Richard Thomas will hold a press conference to announce Mayor's advisory committee. The happy go lucky camera happy Mayor Elect is having another baseless and meaningless press conference while evading the issue of his illegal fundraiser, lacking campaign finances, and his top advisors alleged ties to the Luchese Crime Family.
The press conference is scheduled to be held at the Wartburg in the Soundview Room.
Media in attendance must ask Mayor Elect Thomas about Joseph Spiezio's alleged ties to the Luchese Crime Family. It is also alleged that Spiezio dropped over $100K cash into the lap of Thomas and others in his immediate circle.
|SHADY BUSINESS JOSEPH SPIEZIO|
Questions still remain as to why Richard Thomas would continue to surround himself with such a person who has a documented history of committing fraud. There is also a trail of lawsuits to support this claim.
Over the next few months, Mount Vernon Exposed will provide an in depth analysis of the relationship between Joseph Spiezio and the Thomas family. Mount Vernon Exposed will thoroughly get into the life of Joseph Spiezio and how he lives on a day to day basis. Mount Vernon Exposed previously reported that Mayor Elect Richard Thomas' brother Butch Thomas has been on Spiezio's payroll for over ten years. Butch was the one responsible for introducing the younger, naive, and inexperienced Thomas to Spiezio. Sources have told Mount Vernon Exposed that Butch Thomas has started several corporations that will be used as shell corporations for development projects throughout the City of Mount Vernon.
Butch Thomas and his puppet master, Joe Spiezio, according to political insiders, are planning to construct massive amounts of low income and welfare housing all throughout the City of Mount Vernon. Mayor Elect Richard Thomas has already promised the duo unlimited tax breaks through the Industrial Development Agency of which Richard Thomas will be the chairman of once he is sworn in.
The shady businessman Spiezio was named as a defendant in a Federal R.I.C.O. lawsuit. The Racketeer Influenced and Corrupt Organizations Act, commonly referred to as the RICO Act or simply RICO, is a United States federal law that provides for extended criminal penalties and a civil cause of action for acts performed as part of an ongoing criminal organization. The RICO Act focuses specifically on racketeering, and it allows the leaders of a syndicate to be tried for the crimes which they ordered others to do or assisted them in doing, closing a perceived loophole that allowed a person who instructed someone else to, for example, murder, to be exempt from the trial because he did not actually commit the crime personally.
RICO also permits a private individual "damaged in his business or property" by a "racketeer" to file a civil suit. The plaintiff must prove the existence of an "enterprise". The defendant(s) are not the enterprise; in other words, the defendant(s) and the enterprise are not one and the same. There must be one of four specified relationships between the defendant(s) and the enterprise: either the defendant(s) invested the proceeds of the pattern of racketeering activity into the enterprise (18 U.S.C. § 1962(a)); or the defendant(s) acquired or maintained an interest in, or control of, the enterprise through the pattern of racketeering activity (subsection (b)); or the defendant(s) conducted or participated in the affairs of the enterprise "through" the pattern of racketeering activity (subsection (c)); or the defendant(s) conspired to do one of the above (subsection (d)). In essence, the enterprise is either the 'prize,' 'instrument,' 'victim,' or 'perpetrator' of the racketeers. A civil RICO action can be filed in state or federal court.
Both the criminal and civil components allow the recovery of treble damages (damages in triple the amount of actual/compensatory damages).
Under the law, the meaning of racketeering activity is set out at 18 U.S.C. § 1961. As currently amended it includes:
• Any violation of state statutes against gambling, murder, kidnapping, extortion, arson, robbery, bribery, dealing in obscene matter, or dealing in a controlled substance or listed chemical (as defined in the Controlled Substances Act);
• Any act of bribery, counterfeiting, theft, embezzlement, fraud, dealing in obscene matter, obstruction of justice, slavery, racketeering, gambling, money laundering, commission of murder-for-hire, and many other offenses covered under the Federal criminal code (Title 18);
• Drug trafficking; long-term and elaborate drug networks can also be prosecuted using the Continuing Criminal Enterprise Statute;
• Criminal copyright infringement;
• Money laundering and related offenses;
• Bringing in, aiding or assisting aliens in illegally entering the country (if the action was for financial gain);
• Acts of terrorism.
Pattern of racketeering activity requires at least two acts of racketeering activity, one of which occurred after the effective date of this chapter and the last of which occurred within ten years (excluding any period of imprisonment) after the commission of a prior act of racketeering activity.
Joe Spiezio and his wife Louise Spiezio were sued in federal court under the R.I.C.O. statute. The claims in the lawsuit were outright criminal in nature and it surprising Spiezio and his wife weren't indicted for their crimes. Sources have told Mount Vernon Exposed that Spiezio is a government informant and Mob rat that gets free get out of jail cards. Sources have also told Mount Vernon Exposed that Spiezio constantly brags about being a government informant.
The lawsuit against Spiezio and his wife arose from a development project in Yonkers called the Trolley Barn that Spiezio was a managing member. The project was never developed and ended up getting taken over by the City of Yonkers.
NATURE OF THE ACTION
23. This action arises out of, among other things, violation of the Racketeer Influenced and Corrupt Organization Act, 18 U.S.C. Åò1961, et seq. by Spiezio and others; breach of fiduciary duty by Spiezio in connection with his management of limited liability corporations; breach of contract by Spiezio in connection with his management of limited liability corporations; conversion and unjust enrichment by Spiezio and others; breach of fiduciary duty by the accountant for the limited liability corporations; and breach of contract and unjust enrichment by the law firm retained by one of the limited liability corporations.
24. Commencing about 1998, Spiezio has been entrusted with managing the operations of single purpose limited liability companies ("LLCs") with whom he has shared ownership with plaintiffs Tarsia, Cook and others. Each of the LLCs was to own, manage and operate various real estate investments.
25. Rather than manage the operations of the LLCs in a loyal, trustworthy and professional manner, Spiezio has repeatedly violated his position of trust and his fiduciary duty.
Through artifice and deceit, Spiezio has intentionally diverted millions of dollars of corporate assets from the LLCs to himself, his family members, entities under his ownership and control,
26. Additionally, Spiezio has commingled corporate assets with his own assets and those of other individuals and/or entities that he controls and/or owns in violation of both his fiduciary duty and the provisions of the operating agreements governing the LLCs.
27. Finally, as an integral part of his scheme to cover up his illegal conduct, Spiezio has, notwithstanding repeated requests, stubbornly and arrogantly failed and refused to provide to other members of the LLC’s corporate records, information and documentation to which they are absolutely entitled.
28. As a result, plaintiffs seek both legal and equitable relief against Spiezio and those who have assisted him.
SPIEZIO'S MANAGEMENT OF TROLLEY BARN
a. Failure to produce records to members
36. The operating agreement for Trolley Barn expressly states that the managing member shall provide its members with a quarterly report of Trolley Barn's operations. The operating agreement also states that each member and his respective attorneys, accountants and other advisors shall have the right at all times to examine, review, audit and make copies of Trolley Barn’s books and records.
37. Tarsia and Cook repeatedly demanded an accounting and backup documentation, including copies of invoices from and checks to Joni Management & Realty Services, LLC ("Joni Management") representing the payments made to certain vendors on behalf of Trolley Barn. Spiezio and defendant Kalkstein adamantly failed and refused to provide same.
38. On repeated occasions since at least 2003, both Cook and Tarsia have requested Spiezio to provide documentation regarding the expenses associated with Trolley Barn and the Trolley Barn Project. On virtually all occasions, Spiezio failed and refused to provide the documentation requested or provided insufficient or intentionally misleading documentation.
39. Reports and documentation that Spiezio refused to provide include: petty cash expenditures, monthly income/expense reports for Trolley Barn, an accounting of the receipt disposition of the constructionn funds for the Trolley Barn Project, an accounting of Spiezio controlled or owned entities that received funds from Trolley Barn and alleged payments to Trolley Barn vendors.
FAILURE TO TIMELY PAY VENDORS LEADING
TO MECHANIC’S LIENS
40. As managing member, Spiezio was responsible for payment of all invoices and obligations relating to Trolley Barn and the Trolley Barn Project.
41. Throughout 2003, 2004 and 2005, Spiezio failed to make timely payments to contractors, suppliers, material men and vendors who had supplied products or services for the Trolley Barn Project.
42. Spiezio's failure to make timely payments was the result of his having diverted
Trolley Barn funds to non-Trolley Barn related expenses and/or to his own personal gain.
43. As a consequence of Spiezio not making timely payments to various vendors, certain vendors obtained judgments against Trolley Barn and mechanic's liens were recorded against 92 Main Street.
44. Spiezio concealed from the other members of Trolley
Barn that he had failed to make timely payments to vendors and
that mechanic's liens had been recorded against 92 Main Street as
part of his scheme to divert Trolley Barn funds.
45. As a result of Spiezio's conduct in this regard, Tarsia and Cook were required to satisfy these unpaid debts and incur expenses to seek relief from the mechanic's liens and were otherwise damaged.
46. In addition, Spiezio, acting in concert with defendants Chess Abstract, Konecni, and Stewart Title, deliberately concealed the mechanic's liens from the construction lender in order to obtain construction financing "drawdowns" for the Trolley Barn Project.
SIPHONING FROM LABORERS ON THE TROLLEY BARN PROJECT
47. Spiezio functioned as the construction manager for the Trolley Barn Project. His duties included weekly payment of certain on-site workers.
48. Beginning as early as 2004, Spiezio elected to pay or arrange to have the various on-site workers paid in cash.
49. Spiezio would receive a weekly list of the on-site workers to be paid and the amount to be paid to each from defendant Fredericks. Spiezio and/or Fredericks would routinely pay the workers approximately 20 percent less than the amount listed. On information and belief, Spiezio diverted the difference to non-Trolley Barn related expenses and/or retained the diverted money for his personal benefit.
50. Spiezio knew that documentation kept as part of Trolley Barn records in support of the payments to on-site workers was false and fraudulent.
SPIEZIO'S MISMANAGEMENT OF CONSTRUCTION
51. As stated above, Spiezio had full responsibility for overseeing and managing the Trolley Barn Project.
52. Spiezio failed to perform his oversight and construction management responsibilities.
53. Spiezio's failures include:
- failure to obtain engineering plans for the first floor commercial space of the Trolley Barn Project;
- failure to cause required electrical conduits to be installed;
- failure to cause proper plumbing and heating, ventilation, and air conditioning conduits and systems to be installed;
- causing an improper sub-floor to be installed on the third floor of the Trolley Barn Project;
- generally failed to properly oversee and manage the construction process;
- delayed the construction process and completion of the Trolley Barn Project, incurring additional interest expense and other carrying costs, (i.e., taxes, insurance and utilities);
- failed to test and winterize the fire sprinkler system;
- failed to properly seal and caulk the windows; and
- failed to point bricks on the side of the building facing the railroad.
54. As a result of Spiezio's mismanagement of the Trolley Barn Project, Tarsia and Cook have been substantially damaged.
SUBSEQUENT FUNDING FOR THE TROLLEY BARN PROJECT
FALSE AND MISLEADING STATEMENTS BY SPIEZIO
55. Spiezio repeatedly provided false and misleading information with respect to the cost to complete the Trolley Barn Project. On repeated occasions, Spiezio grossly understated the construction costs, without supporting documentation. Spiezio's understatement of the cost to complete the Trolley Barn Project were made to induce Tarsia and Cook to continue in the Trolley Barn Project and to conceal Spiezio's diversion of massive amounts of construction fund dedicated to complete the Trolley Barn Project. The understatements also resulted in the need to obtain multiple refinancings for the Trolley Barn Project.
56. In connection with the refinancings, the members of Trolley Barn were required to submit to lending institutions certain financial information and to make certain representations.
57. The members of Trolley Barn understood that submitting false information might result in a default by Trolley Barn under existing or refinanced loans.
58. Spiezio, as one of the members of the Trolley Barn, submitted documentation to lending institutions that he knew to be false and misleading. By way of example, he failed to disclose that he had transferred his interest in Trolley Barn to defendant Spiezio Family Holdings.
59. Spiezio's failure to disclose the transfer of his membership interest in Trolley Barn to Spiezio Family Holdings placed Tarsia and Cook at risk in that it caused Tarsia and Cook to bear a disproportionate share of the liability under the construction loan. Tarsia and Cook personally guaranteed the loan, but Spiezio Family Holdings entered into no such guarantee.
OTHER SPIEZIO SCHEMES
PAYMENTS TO POLITICAL CAMPAIGNS
60. During the period of at least 2002 through 2004, Spiezio, on multiple occasions, authorized and caused contributions to be made various political campaign funds from accounts of Trolley Barn that were earmarked for the payment of expenses for the Trolley Barn Project.
61. The payments to political campaigns were made without the approval or knowledge of the other members of Trolley Barn.
62. The payments to political campaigns were part of Spiezio's scheme to divert funds from the Trolley Barn Project for non-Trolley Barn Project related expenses and/or for his personal interest and gain.
TRANSFER OF MEMBERSHIP INTEREST AND FUNDS TO
SPIEZIO FAMILY HOLDINGS
63. Section 9.1 of the Trolley Barn operating agreement expressly states that a member may not transfer his interest in the Trolley Barn without written consent of all the other members.
64. On information and belief, some time before April 13, 2003, Spiezio secretly transferred his interest in Trolley Barn to Spiezio Family Holdings.
65. After secretly transferring his interest in Trolley Barn to Spiezio Family Holdings, Spiezio falsely represented to parties dealing with Trolley Barn that he personally continued to be a member of Trolley Barn.
66. During the period of at least 2002 through 2003, Spiezio, on multiple occasions, authorized and caused to be made from accounts of Trolley Barn payments to Spiezio Family Holdings.
67. The payments to Spiezio Family Holdings were made without the knowledge or approval of the other members of Trolley Barn.
68. The transfer of funds to Spiezio Family Holdings was part of Spiezio's scheme to divert funds from Trolley Barn to non-Trolley Barn related expenses and/or for his personal interest and gain.
OTHER IMPROPER PAYMENTS MADE OR AUTHORIZED BY SPIEZIO
69. During the period of at least 2002 through 2004, Spiezio, on multiple occasions, illegally authorized and caused payments to be made from the accounts of Trolley Barn to
himself and/or to others totaling hundred of thousands of dollars. By way of example:
Spiezio authorized payments to an insurance company for automobile insurance. However, no automobile insurance was necessary for Trolley Barn.
Spiezio authorized payments to John Hancock Financial Services. However, there was no need for Trolley Barn to use John Hancock Financial Services.
Spiezio authorized checks made payable to "cash" that were subsequently cashed or deposited by Spiezio into his personal accounts. These checks total in excess of $200,000 through December 2004.
Spiezio authorized Trolley Barn to pay several credit card accounts. The amount paid for these accounts for the period of July 2002 through December
2004 was in excess of $450,000.
Defendant Louise Spiezio, the spouse of Spiezio, charged items on credit cards that were paid for from Trolley Barn accounts. Payments for these expenses were approved and authorized by Spiezio.
70. Notwithstanding requests by Tarsia and Cook to Spiezio to produce supporting documentation as to how the above expenses and others relate to Trolley Barn, Spiezio has failed and refused to provide Tarsia or Cook the documentation supporting the underlying expenses.
71. The payments referred to above were part of Spiezio's scheme to divert funds from Trolley Barn to non-Trolley Barn related expenses and/or for his personal interest and gain.
COMMINGLING OF FUNDS BY SPIEZIO
72. The operating agreement of Trolley Barn has separateness covenants and provides that the managing member shall not commingle the assets of Trolley Barn with any other entity.
73. Trolley Barn funds were transferred to and/or received from the bank accounts of Joni Property, Mercantile Lofts, LLC, Gazette Realty Holdings, LLC, Long Beach Road Holdings, LLC and South Broadway. None of these entities was part of Trolley Barn.
74. The transfers to and/or receipts from these entities were made without the knowledge or approval of the other members of Trolley Barn.
75. When these transfers and receipts were discovered, Tarsia and Cook made repeated requests to Spiezio, Fredericks (the bookkeeper) and Kalkstein (the accountant) for documentation explaining the transfer and receipt of funds to/from these entities. However, in furtherance of and consistent with his scheme, Spiezio, (along with Fredericks and Kalkstein, at Spiezio’s direction) failed and refused to provide any explanation or documentation.
76. The commingling of funds was part of Spiezio's scheme to divert funds from Trolley Barn to non-Trolley Barn expenses and/or for his personal and his family’s personal gain.
DIVERSION OF CORPORATE ASSETS
77. On information and belief, Spiezio directed and authorized that construction materials be delivered to his residence in New Rochelle, New York and other locations. These materials were improperly charged to and paid for by Trolley Barn although they were not part of the Trolley Barn Project.
78. On information and belief, Spiezio directed and authorized workers who were ostensibly hired to perform work on the Trolley Barn Project to instead perform work at his residence in New Rochelle. The work performed at Spiezio's residence was improperly charged to and paid for by Trolley Barn although the work was not for the Trolley Barn Project.
79. Neither Tarsia nor Cook was aware of this diversion of labor and materials and neither of them approved this activity.
80. Use of labor and materials designated for and paid for by Trolley Barn was part of Spiezio's scheme to divert funds from Trolley Barn to non-Trolley Barn expenses and/or for his personal and his family’s personal gain.
KALKSTEIN, MBA TAX ASSOCIATES AND KALKSTEIN & CO.
81. Kalkstein, a convicted felon, was retained by Spiezio to prepare financial documents and income tax returns for Trolley Barn as well as other entities in which Spiezio, Tarsia and Cook had an interest. Kalkstein performed such work under the names Kalkstein & Co. or MBA Tax Associates.
82. As part of that work, Kalkstein had access to the financial records of Trolley
83. Kalkstein knew that Tarsia and Cook were members of Trolley Barn.
84. Notwithstanding this knowledge, Kalkstein failed to disclose to Tarsia and Cook the commingling, diversion and/or conversion of funds by Spiezio.
85. Upon learning that Kalkstein was a convicted felon and required to surrender his license as a certified public accountant, Tarsia and Cook repeatedly demanded that Spiezio replace Kalkstein with a licensed certified public accountant in good standing. Spiezio failed and refused to do same.
86. Tarsia and Cook also repeatedly requested Kalkstein to provide Tarsia and Cook with all Trolley Barn financial information and records.
87. Notwithstanding that Kalkstein knew that Tarsia and Cook were members of Trolley Barn, Kalkstein refused to produce financial information and records concerning Trolley Barn to Tarsia and Cook.
88. Kalkstein’s actions were controlled by and done at the direction of Spiezio in furtherance of Spiezio’s scheme to divert funds from Trolley Barn to non-Trolley Barn expenses and/or for his personal gain.
CHESS ABSTRACT, KONECNI AND STEWART TITLE
89. At various times, Chess Abstract, a title agency company owned and or controlled by Spiezio, was retained to perform title rundowns searches relating to construction loan "drawdowns" on the Trolley Barn Project. Chess Abstract was an agent of defendant Stewart Title. Konecni was the co-owner and director of operations of Chess Abstract.
90. On multiple occasions, Chess Abstract and Konecni, with the knowledge and at the direction of Spiezio, deliberately failed to disclose mechanic's liens recorded against 92 Main Street.
91. On information and belief, Chess Abstract, as agent for Stewart Title, failed to make disclosure of the mechanic's liens in furtherance of Spiezio's scheme to divert funds from Trolley Barn.
92. Furthermore, on at least one occasion, Chess Abstract and Konecni, during loan closings for Trolley Barn, caused Trolley Barn monies to be used to pay the personal expenses of Spiezio in furtherance of Spiezio's scheme to divert funds from Trolley Barn.
93. Fredericks was hired by Spiezio as a bookkeeper/controller for Trolley Barn and other entities that Spiezio managed, controlled or had a direct or indirect ownership interest in.
94. Fredericks acted in furtherance of Spiezio’s scheme to divert funds from Trolley Barn to non-Trolley Barn related expenses and/or for Spiezio’s personal gain. In that regard, Fredericks’ acts include:
preparing false payroll records for the Trolley Barn Project;
assisting in the unauthorized payments from the accounts of Trolley Barn to
other entities which had not provided goods or services to Trolley Barn;
other entities which had not provided goods or services to Trolley Barn;
assisting and/or failing to report Spiezio’s diversion of funds from Trolley
failing to provide financial records to other members of Trolley Barn and assisting in Spiezio’s commingling of Trolley Barn funds.
REPRESENTATION BY SMITH BUSS
95. In October 2004, at the insistence of Spiezio, Smith Buss was retained by Trolley Barn to prepare an offering plan for the conversion of the Trolley Barn Project to a condominium.
96. Smith Buss and Trolley Barn entered into a written fee agreement concerning the legal services to be provided by Smith Buss.
97. As part of the fee agreement, Trolley Barn was required to and did pay Smith
Buss an initial payment of $10,000.
98. None of the work required under the fee agreement for the conversion plan was performed by Smith Buss or was ever provided to Tarsia or Cook, notwithstanding their repeated requests for same.
99. Although no conversion plan had been submitted, Smith Buss requested that Tarsia and Cook execute a certification that they had reviewed the conversion plan, when in fact no conversion plan had ever been prepared or provided. What is more, Smith Buss knew that making such a request was improper under the circumstances.
100. Shortly thereafter, by letter dated October 5, 2005, Smith Buss advised Tarsia and Cook that it would no longer provide the legal services set forth in the fee agreement. Smith Buss apparently decided that its relationship with Spiezio presented a conflict of interest.
101. As a result of the foregoing, Tarsia and Cook requested Smith Buss to refund the
$10,000 fee. To date, none of the money has been returned.
102. Furthermore, the failure of Smith Buss to complete the offering plan has caused Trolley Barn to unnecessarily incur substantial carrying costs, including interest, taxes, insurance, utilities, etc.
103. As a result of the conduct of Smith Buss, the condominium conversion plan has not been accomplished and Tarsia and Cook have been substantially damaged.
104. The members of Joni Property are Tarsia and Spiezio who each have a 50 percent interest.
105. The sole asset of Joni Property is the Centuck Shopping Center ("Centuck"), a property located at 1557-1591 Central Park Avenue, Yonkers, New York. Centuck consists of approximately 47,000 square feet of rentable commercial retail space with approximately 25 tenants.
106. Spiezio is the managing member of Joni Property. As the managing member, Spiezio is responsible for ensuring that the monthly rent payments are collected from the tenants of Centuck.
107. On information and belief, beginning at least as early as 2005, Spiezio (or an entity owned or controlled by Spiezio) received monthly rent payments from commercial tenants in the form of cash. Also on information and belief, all of the cash payments received have not been deposited with Centuck.
108. Tarsia, on repeated occasions, requested that Spiezio (or an entity owned or controlled by Spiezio) provide documentation regarding rents collected from tenants and cash deposited on behalf of Centuck. Spiezio has failed and refused to provide that information. In addition, Tarsia’s personal accountant, Paul Star, has requested that Spiezio and Kalkstein
provide copies of complete income returns and all schedules. Spiezio and Kalkstein failed and refused to provide same.
109. Tarsia, as an equal member of Joni Property, is entitled to review all documentation regarding the operations of Centuck, including records of rents received. Tarsia has requested all such information but Spiezio has refused to provide same.
110. As a result of Spiezio's failure and refusal to provide the requested documentation to Tarsia, Tarsia is unable to independently determine if the finances of Centuck are in proper order.
111. Spiezio's failure and refusal to account for the cash rental payments and his failure and refusal to provide documentation and information regarding operations of Centuck is part of his scheme to divert funds from Joni Property for his personal gain