SEATTLE — Federal prosecutors Monday obtained a temporary restraining order against Honey’s in Everett and two other Seattle-area strip clubs and their owners, alleging, among other things, that they failed to report income, costing the city of Seattle thousands of dollars in tax revenue.
The affidavits also allege that agents found owners Frank Colacurcio Sr. and his son, Frank Jr., took a cut of money dancers received for illegal sex acts.
The court documents name the clubs Rick’s in Seattle, Sugar’s in Shoreline, and Honey’s in Everett, along with the Colacurcios, the Talents West talent agency and Accurate Bookkeeping in Seattle. Warrants were served at those locations Monday, and at Fox’s, a club in Parkland, south of Tacoma, FBI spokeswoman Robbie Burroughs said.
The restraining order prohibits the Colacurcios and their associates of selling the clubs or doing anything to lessen their value. Prosecutors said at a news conference that it’s the first step in freezing assets pending the conclusion of a racketeering investigation that alleges the clubs were run by a criminal enterprise.
“For far too long, the Colacurcios’ organization has made big money operating their clubs as fronts for prostitution,” U.S. Attorney Jeff Sullivan said. “The Colacurcios have designed the clubs, the payment methods and the policies that encourage prostitution and to ensure they are the ones getting rich off these illegal sex acts.”
No criminal charges have been filed. Lawyers for the Colacurcios didn’t immediately return phone calls for comment. They can ask for a hearing to challenge the restraining order.
Other charges being contemplated include money laundering and mail fraud, in reference to alleged chronic underreporting of attendance at Rick’s, Sullivan said.
Investigators estimate that cost the city of Seattle more than $3,000 per month in lost tax revenue. That was based on data from a surveillance camera installed on a utility pole outside Rick’s in June 2006 to count customers entering the establishment. Officials said they were conservative in counting “customers” — for example, women were not counted.
But in July 2006, while Rick’s reported 7,929 customers, the camera recorded nearly 14,000, the affidavit said.
The affidavit also says ATMs and credit card machines in the clubs dispensed tokens instead of cash that customers would use to pay dancers. But when dancers redeemed the tokens, they were given less cash than the tokens’ face value — evidence of skimming, the affidavit says.
Authorities say that as part of the investigation, a police undercover officer infiltrated the organization, first through Talents West to be a waitress at Sugar’s. Five weeks later she was named a manager at Rick’s.
Seattle Police Chief Gil Kerlikowske called it “the most significant organized crime investigation we have ever undertaken,” and added that the enterprise had “done considerable damage to this city.”
“It’s an organization that has made its money on the backs of women. It’s about violence and organized crime. It’s not about the morals police,” he said.
Colacurcio Sr. has been a controversial figure in Seattle for six decades. He was even named a racketeer before a U.S. Senate committee in the 1950s.
In January, the Colacurcios pleaded guilty to felony criminal charges in Seattle’s “Strippergate” campaign-finance scandal. They each agreed to each pay $75,000 in criminal and civil penalties.
That scandal erupted at City Hall in 2003 after the Colacurcios secretly funneled thousands of dollars in illegal campaign contributions through friends, relatives and business partners to the re-election campaigns of three Seattle City Council members.
The contributions came shortly before the council approved a rezone allowing Rick’s to add parking spaces.
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