Three nightclub operators charged in money laundering sting

A 20-count indictment says $360,000 involved

May 02, 2001|By Gail Gibson | Gail Gibson,SUN STAFF

CLARIFICATION

An article about a federal money laundering investigation that was published in some editions of The Sun yesterday did not include the location of the Bay Cafe restaurant owned by two Baltimore men charged in the case. The restaurant is in Fenwick Island, Del., and is not connected to the Bay Cafe on Boston Street in Baltimore.

The operators of three area adult-entertainment nightclubs were charged in a federal indictment unsealed yesterday with laundering more than $360,000, money they believed came from drug dealing and an armored-car robbery but was part of an FBI sting operation.

Francis Lee, 45, Kerry C. Canavan, 45, and Henry D. Caldarazzo, 40, all of Baltimore, were charged with money-laundering and conspiracy in a 20-count indictment made public yesterday in U.S. District Court in Baltimore.

The indictment also called for the forfeiture of nine bank accounts related to their businesses, as well as the nightclub properties and respective liquor licenses. Federal authorities said those assets were seized yesterday.

The clubs involved were the Ritz Cabaret at 504 S. Broadway in Baltimore and Caesar's Empire, also known as The Sugar Shack, on Earl's Road in Chase, Baltimore County. Both were owned and operated by Lee, who also uses the name Le Tuyen Dinh. The third club, Fantasy Limousine and Memories on North Point Boulevard in Baltimore County, was owned and operated by Canavan.

Court records show that undercover FBI agents steered large sums of cash -- purported to be profits from drug sales and an armored car robbery -- to three men in exchange for checks to make the money appear to be the proceeds of legitimate business activities.

At times, the men would charge interest on the money they agreed to launder through their businesses, according to court records, but sometimes they were willing to exchange postdated checks or promissory notes for interest-free use of the cash.

In a meeting with an undercover special agent Oct. 14, 1999, Lee showed the agent around the Ritz Cabaret and discussed how he planned to make improvements using the money he was laundering, the indictment said.

Lee and Canavan were arrested yesterday and released after an initial appearance before U.S. Magistrate Judge Daniel E. Klein Jr.

Caldarazzo, who court records say worked as a night manager at the Ritz and operated a pager and cellular-telephone business, had not been arrested as of late yesterday. Canavan and Caldarazzo also jointly operated the Bay Cafe, a restaurant in Fowned Ice House Liquors in Aberdeen. None could be reached for comment.

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