Friday, June 11, 2004 | 11:02 a.m.
The Las Vegas City Council will likely put off a decision Wednesday on sanctioning a troubled strip club in light of a lawsuit filed by the state of Texas accusing the business's owners of money laundering, city officials said this morning.
Texas last week filed a civil suit in Houston against Ali and Hassan Davari, owners of Treasures in Las Vegas and six nightclubs in Houston, alleging irregular banking practices. Also, federal and state authorities have seized more than $2.1 million from the men's bank accounts.
No charges have been filed against the Iranian-born Davari brothers, who also are known as Dave Davari (Ali) and George Davari (Hassan).
The new development in Texas is not the only reason Las Vegas officials are "are likely to table" Wednesday's agenda item to review the club's performance over the past three months, City Finance Director Mark Vincent said, referring to the
"We were likely to ask that it be held in abeyance anyway because no action has been taken on local charges (four counts of alleged prostitution at the club). We will rely on Metro Police's investigation (of the matters in Houston) to determine suitability relevance. That (Houston action) adds a new wrinkle."
Councilwoman Janet Moncrief said that "money laundering is always a serious business. In a time of war, money laundering should be looked at as a very significant issue."
She said she hadn't made any judgment as to how the issue might affect the Davaris' license, but said she thought the discussion should take place in public, even if the decision itself is delayed.
"The public should have the ongoing knowledge. Even if we don't make a decision Wednesday, we should have a discussion about this," Moncrief said.
Because there have been no convictions on the prostitution citations, she said, "I don't feel we should be making any rash decisions before some of these other allegations are resolved."
Councilman Gary Reese said that he agreed the issue should be discussed publicly, even if the decision is not made Wednesday.
"We ought to at least hear what's going on in a public forum," he said.
Reese said the money laundering allegation "may not have anything to do with the agenda item for next Wednesday, but it certainly puts a cloud over it."
Still, he said, "a man is innocent until proven guilty."
In March, the Las Vegas City Council gave the $30 million Treasures club at 2801 Westwood Drive near Sahara Avenue and Interstate-15 an additional three months to prove it can operate without allowing prostitution and other lawbreaking activities.
On June 1, the state of Texas filed a notice of seizure and intended forfeiture in Harris County District Court in Houston, asking that about $2.17 million seized from the Davaris, both listed as residents of Houston, be forfeited to the state as"contraband."
A notice of seizure filed with that document, said that on May 25, Wayne T. Chaney of the Department of Homeland Security and the Houston Police Department had seized four official or cashiers checks written on three banks, totalling nearly $2.17 million.
Chaney alleged in the document that the "property constitutes proceeds of a felony offense."
The document identifies Ali and Hussan Davari as "structuring cash withdrawals from several of their bank accounts in the Houston Area. During a six-month period, the Davari(s) have withdrawn approximately $2.5 million in cash in increments of approximately $9,500 from their bank accounts."
In a statement, the Davari brothers' Houston attorney Paul Nugent said the men "deny any wrongdoing and look forward to their day in court," the Houston Chronicle reported last Saturday. Attempts to reach Nugent today were not successful.
The Davaris' local attorneys -- Louis Palazzo, Mark Fiorentino and Ross Goodman -- could not be reached for comment this morning.
Prior to the March council decision, in which there were two absentions -- Mayor Oscar Goodman because Ross Goodman is his son and Councilman Michael Mack because he represents the club as a publicist -- a six-month tavern license was issued to the club.
That temporary license, which included the review in March, was agreed to by the Davaris after a long, complicated battle to open the business. The license had been granted in 2001, but the club did not open until last September.
Investigators also had found alleged drug and prostitution violations at the brothers' Houston businesses.
In 2001, members of the Las Vegas City Council had said they wanted to raise the bar for acceptable behavior at adult entertainment businesses, hoping the large off-Strip investment would be an incentive to crack down on managers and dancers who crossed the line.
In March police ran down a list of alleged infractions, including four arrests for prostitution and multiple violations of rules regarding touching between dancers and patrons.
Nevertheless, the council voted to give Treasures three more months to clean up its act.
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