Friday, May 16, 2003 | 11:50 a.m.
Clark County and Las Vegas building inspection chiefs said Thursday they had not been contacted by the FBI, even though federal authorities are investigating whether payoffs were made to building inspectors in connection with a probe of the Galardi family strip club empire.
But Phil Rosenquist, director of the Clark County Department of Development Services, which oversees inspections in unincorporated parts of the county, said his employees had numerous problems when the Jaguars cabaret was built and felt "pressured" by the builders to approve its permits.
Jaguars, the posh two-story gentlemen's club at 3355 Procyon St. near Desert Inn Road, opened in June 2002. It is owned by Michael Galardi. Jaguars and three other Las Vegas properties owned by Michael Galardi and his father, Jack Galardi, were searched by about 100 FBI agents and other law enforcement officials Wednesday. Michael Galardi's Cheetahs strip club in San Diego was also searched as were the offices of three San Diego city council members. No arrests were made and no charges have been filed.
Among the items federal agents are seeking are "records including ledger or journals or handwritten notes of payments or gifts" to Las Vegas Councilman Michael McDonald, former Clark County Commissioner Erin Kenny, her husband John Kenny, former County Commissioner Dario Herrera, his wife Emily Herrera, County Commissioner Mary Kincaid-Chauncey, her husband Robert Chauncey, "or to building inspectors."
The FBI also is seeking records related to building or construction contractors.
The reference to the building inspectors did not mention any specific government agency. Asked for his reaction, Las Vegas Building and Safety Director Paul Wilkins said he was "dumbfounded."
"I haven't been contacted," Wilkins said. "I haven't the faintest idea what that is about."
Rosenquist had a similar reaction when asked whether he had been contacted by the FBI.
"Nope, not a word," he said. "I don't know what's going on but I'd sure like to talk to them about it."
Rosenquist said he is certain that his employees did nothing wrong. He said he did not plan to conduct an internal investigation. The reason, he said, is that the county repeatedly told Galardi's contractors that they weren't meeting building codes. That's the opposite of inspectors being paid to look the other way, he said.
"They had some pretty substantial structural difficulties," Rosenquist said. "Clearly, they were having construction problems."
The county's inspection records for the cabaret bear this out. There were at least 110 inspections over the life of the project where the work was disapproved by inspectors.
As a result, Rosenquist said the county issued numerous stop-work orders before various phases of construction were corrected to meet codes. One contractor, Jaehn Construction of Las Vegas, was replaced by another, Distinctive General Contracting of North Las Vegas.
"It took two years and three months to complete that project," he said. "We have had high-rises on the Strip built in less time than that."
Rosenquist said it is normal for his inspectors and plan checkers to field complaints from impatient builders who want to complete their projects. But he said the volume of telephone calls and other complaints from builders of Jaguars exceeded the norm and irritated his staff.
"From what I heard from my staff there was a lot of pressure on them to keep things moving," Rosenquist said.
Telephone messages seeking comment from Galardi and Jaguars manager Michael Beezley were not returned Thursday. Messages left with Jaehn Construction and Distinctive General Contracting also weren't returned.
But Scott Smith, spokesman for the 670-member Associated General Contractors, which represents Southern Nevada builders, said he has never heard of any local contractors who have applied pressure on inspectors and has not heard of any inspectors who accepted bribes.
"I have not heard anything like that and I don't know why anyone would be suspected of that," Smith said. "The building codes are pretty self-explanatory."
Smith said he was not familiar with the construction problems at Jaguars but said Distinctive General Contracting is a member in good standing with his organization.
He said representatives of the county and municipal building inspection departments in Southern Nevada meet monthly with an inspection committee run by the contractors' association.
"We've had nothing but good relations with the county," Smith said. "It's a very competitive industry. For anyone who would allow themselves to subvert the process we would hold their feet to the fire."
A chronology of Jaguars prepared by county staff began in October 1998 with approval by the county's Comprehensive Planning Department of an adult use within an existing tavern for what was initially to be called The Gold Club.
In March 1999 the Business License Department issued a temporary license for the Gold Club Inc., which at the time was co-owned by Michael and Jack Galardi.
But the name, Gold Club, raised a red flag with Metro Police. That's because a strip club by the same name in Atlanta was embroiled in a highly publicized racketeering case that included ties to New York's Gambino crime family and testimony from former National Basketball Association stars Patrick Ewing and John Starks, who were customers.
The case ended in January 2002 with Gold Club owner Steve Kaplan sentenced to 16 months in prison for skimming profits on behalf of the Gambino family. Eight other defendants were given probation.
But an attorney for Jack Galardi, who owns strip clubs in Atlanta and has a residence there, convinced the Clark County Commission in May 1999 that his client had no connection to the Gold Club in Georgia and that it was a mere coincidence that the Galardis wanted to use that business name in Las Vegas.
By a 4-3 vote the commission, sitting as the Liquor and Gaming Licensing Board, denied a request by Metro Police to authorize $11,000 in travel expenses for Metro to research the Gold Club case in Atlanta. Metro had insisted that Jack Galardi was tied to a grand jury investigation in Atlanta but Galardi's attorney issued a denial, saying his client had never been notified.
Three months later, in August 1999, Jack Galardi resigned as shareholder and officer of The Gold Club in Clark County, leaving son Michael as sole owner. He submitted an application for a new restaurant at the location, with a permit issued for a two-story, 16,438-square-foot structure.
A series of licenses were also approved for the club in late 1999, including a September 1999 cabaret license that allowed Michael Galardi to open for business. But the county approved temporary closure of the club on nine occasions between January 2000 and June 2001 for remodeling while allowing Galardi to retain his liquor license.
In November 2000 the county approved a name change from The Gold Club to Jaguars. About this time, Galardi attempted to open another Jaguars strip club in San Diego, where he already owned another cabaret. But the Jaguars in San Diego never got off the ground because of a permit dispute. He sued that city but eventually withdrew the lawsuit.
The Comprehensive Planning Department in August 2001 approved an adult cabaret for what had become a 20,620-square-foot restaurant building. The county commission that month also approved a limited tavern liquor license for Jaguars, with support from Herrera, Kenny, Kincaid-Chauncey and fellow Commissioners Chip Maxfield and Bruce Woodbury. Commissioner Yvonne Atkinson Gates opposed the motion and Commissioner Myrna Williams was absent.
A full tavern liquor license for Jaguars was approved unanimously by the commission in September 2001, with Herrera and Maxfield absent. The final business license and certificates of occupancy for Jaguars were issued in June 2002.
In July 2002 the commission approved stricter lap-dancing regulations, with Atkinson Gates, Kincaid-Chauncey, Maxfield, Woodbury and Williams voting in favor and Herrera voting in opposition. Kenny was absent.
This vote caused Michael Galardi to request permission from the county to annex his business into Las Vegas, where the lap-dancing ordinance isn't as strict. But he withdrew that request last December.
Mike Galardi's lawyer, Peter S. Christiansen, said this morning that well-known criminal defense attorney Tom Pitaro and private investigator Tom Dillard have joined Galardi's defense team.
Pitaro has been involved in several high profile cases, including the Ted Binion murder trial and the Margaret Rudin murder trial. He also defended former District Judge Gerard Bongiovanni, who was acquitted several years ago on federal bribery charges.
Dillard, working as a private investigator for Binion's estate, helped Metro Police put together the murder case against Binion's convicted killers, Rick Tabish and Sandy Murphy.
Though on the opposite side of Pitaro in the Binion case, Dillard worked with the lawyer on Rudin's defense team. Rudin was ultimately convicted of killer her husband, Ron Rudin.
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