Former promoter accused of swindle Defendant arrested at IRS office charged in Georgia case

March 30, 1996|By Peter Hermann | Peter Hermann,SUN STAFF

A convicted tax evader and once-nationally known concert promoter from Baltimore, whose empire crumbled a decade ago when IRS agents raided his Worthington Valley estate, has been charged with swindling a Georgia man out of $28,000.

Richard Klotzman, the son of a Baltimore pawnshop owner who built a $20 million rock promotion company by the time he reached 30, was arrested Thursday morning in the offices of the Internal Revenue Service.

Mr. Klotzman, 51, is awaiting extradition to Baldwin County, Ga., where he was indicted in 1993 on charges of theft by deception. "We've wanted him for a long, long time," said Chief Deputy Sheriff Howard Sills of Baldwin County.

Federal agents raided Mr. Klotzman's $700,000 Phoenix home Thursday morning. A spokesman for the Baltimore IRS office, Domenic J. LaPonzina, would not elaborate. "What is being researched and what is being retrieved, I can't get into," he said.

Police in Georgia charged Mr. Klotzman with promoting a rap concert featuring Snoop Doggy Dogg, Geto Boys and Run DMC and convincing Alfred Willis to put up the $28,000 for a show in Macon, Ga. The concert never happened, but police said Mr. Klotzman got the money.

"He defrauded a poor fellow here of his whole life savings," Sheriff Sills said. "He cleaned out this poor guy."

Mr. Klotzman, a colorful figure who grew to prominence in the 1970s promoting performers such as Elton John, the Grateful Dead, Cat Stevens and Liberace, once bought $4,000 worth of roses and spread the petals in rock star Mick Jagger's hotel room.

He ran into legal trouble in 1979 when he was charged with failing to pay nearly $250,000 in income taxes from 1971 to 1974.

Court papers at the time also charged that he bilked concerts that he promoted and even walked out of one carrying $50,000 in cash stuffed in a brief case. He pleaded guilty to the tax evasion charges and was sentenced to four months in a halfway house and fined $10,000.

Property seized

In 1983, he received an 18-month suspended sentence after being convicted on 35 counts of failing to pay the government for income tax withholdings he had collected from 15 of his employees.

And in 1985, federal agents stormed his 200-acre Worthington Valley estate and seized belongings after charging him with failing to pay $9.1 million in income taxes. Agents seized three Mercedes-Benz cars, 60 works of art -- including a Picasso and a Chagall -- loose diamonds, a baby-grand piano and eight television sets.

'Danger to society'

Two years later, Mr. Klotzman was sentenced to 3 1/2 years in prison after pleading guilty to evading $1 million in taxes and bilking his own concert promotions -- including Prince's 32-city "Purple Rain" tour -- out of hundreds of thousands of dollars. A federal judge described him as "a danger to society" for his "endless chain of lies."

Property records for Mr. Klotzman's home in the 12600 block of Jarrettsville Pike, in Phoenix, show it to be a 2 1/2 -story house with five bathrooms and three fireplaces that was built in 1928. It sits on nearly 7 acres.

Federal officials would not comment yesterday on why Mr. Klotzman was arrested at the Baltimore IRS headquarters at the Fallon Federal Building.

Police in Baldwin County, about 25 miles southwest of Macon, said Mr. Willis, 36, wired $28,000 to a Baltimore bank account set up by Mr. Klotzman nearly three years ago. Neither Mr. Willis nor Mr. Klotzman could be reached for comment.

Pub Date: 3/30/96

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