Cops Were in on Salon Owner's Takedown
BROOKLYN, N.Y. (CN) - Police officers falsely arrested the owner of a New York City salon as part of a conspiracy dreamed up by her partners to take control of the business, the woman claims in a $100 million federal RICO lawsuit.
Georgette Franzone, a "successful business venture capitalist," says she was approached in March 1999 by Violette Tonuzi and Charbel "Charles" Elias to help finance a new salon, the Cavale-Tonuzi Spa in Bay Ridge, Brooklyn, in exchange for a small percentage.
Shortly thereafter, Franzone says allegedly that her would-be partners were not "credit worthy" and unable to obtain funding.
When Franzone asked about that issue, she says they told her that space constraints at their current salon had them turning away customers and losing money, according to the complaint. Tonuzi said it was "feast or famine."
Franzone then allegedly agreed to provide a $625,000 bridge loan.
While she was growing the business through hiring and training a staff, however, Tonuzi and Elias "started to realize the value of CTS and began setting the pace for nothing less than the theft-conversion-embezzlement of the business' income," the complaint states.
Franzone says the pair were "skimming cash income from the business" to eliminate her shareholder value and drive her out.
This manipulation allegedly cost Franzone about $400,000 between 1999 and 2007
Franzone says the pair paid for personal items like dry cleaning, dinners, lunches, prescriptions and gas from the till. They're also accused of selling gift certificates to customers, then performing the services without taking pay for the company.
They also used the salon as a "face for serial income tax evasion," the complaint states.
Aside from failing to report tips, the two skimmed money from the business, causing 40 or 50 percent of the proceeds to go missing, according to the lawsuit.
They allegedly claimed that they used the money to hire independent hairdressers.
The Internal Revenue Service conducted an audit in 2002-03, but Tonuzi and Elias were still not reporting tips, Franzone claims. She says that when she confronted them, they stated they would each leave and take their clients with them.
They also allegedly used the company's credit card processor that allowed clients to charge tips as a service fee.
Elias then charged $10,000 onto his personal credit card, and took the cash from the register, according to the complaint.
When Franzone installed an ATM on the premises, Elias threatened her with physical assault and threatened to destroy the machine, according to the complaint.
Franzone says she filed a police report and invested another $220,000 to keep the business alive. Tonuzi allegedly refused, however, to work a full-time schedule and undercharged clients or waived fees to encourage cash payments directly to her.
Fed up, Franzone says she demanded a buy-out of $864,000, and that the parties agreed on a settlement.
Tonuzi and Elias then employed the aid of defendant Farije Tonuzi-Sheridan, asking her to use her former position as a New York City police officer to seize the salon from plaintiff and illegally lock her out, according to the complaint. Using other officers who cooperated "for the right price," they then changed the locks and falsely claimed to have a court order to seize the business, Franzone says.
The alleged co-conspirators then brought in Liliana "Calogera" Narbone to forge a note that made it look like Franzone had executed a $100,000 loan. Narbone demanded summary judgment on the note, but the court denied the motion as an obvious forgery.
Sheridan then used her position as a former police officer to falsely arrest Franzone based on Narbone's complaint.
Plaintiff says Sheridan contacted Officer Juan Tejera, a friend, to have him arrest her and that she "had to be dealt with."
Tonuzi, Elias and Sheridan then filed a false claim for Franzone's arrest in the Midtown South Precinct.
Franzone says she spent at least 30 hours in police custody without charges ever being filed.
Officer Ann Guerin agreed to help, according to the complaint.
Franzone says the aforementioned individuals and entities "illegally using their friends and family, each of whom were at the time active New York City Police Officers or retired officers" to "instill fear and intimidation" in her.
She seeks nearly $100 million for violations of federal anti-racketeering law, breach of contract, unjust enrichment, unfair competition, negligence and conversion.
Franzone is represented by Douglas Dollinger in White Plains, N.Y.