Mental exam ordered for strip club owner

Sentencing is delayed in money laundering case

May 24, 2002|By Gail Gibson | Gail Gibson,SUN STAFF

A Fells Point strip club owner facing prison time for money laundering got a strange reprieve yesterday when a federal judge postponed sentencing, and instead ordered bar owner Francis Lee held to undergo a psychiatric exam.

The order by Chief U.S. District Judge Frederic N. Smalkin came after Lee, 46, unexpectedly stood up in court and said that he wanted to change lawyers and withdraw his guilty plea.

As Lee then slumped at the defense table, his head in his hands, Smalkin questioned whether the operator of the troubled Ritz Cabaret on South Broadway was mentally fit to proceed with sentencing and ordered him held for up to 45 days for a competency evaluation.

"I don't think he's functioning with an appreciation of reality," Smalkin said in court.

Neither defense attorneys nor prosecutors objected to Smalkin's ruling.

The results of the competency exam will determine whether Lee will be sentenced for his role in laundering more than $360,000, money that he and two other nightclub operators believed was from illegal drug sales and an armored car robbery but was part of an FBI sting operation.

Lee also pleaded guilty in March to one count of harboring illegal aliens for financial gain, a charge that stemmed from his illegal hiring of Hungarian nationals to work at the Ritz Cabaret as nude dancers.

After court yesterday, defense attorney David P. Henninger and a woman who said she is Lee's business partner said that they expected the psychiatric exam will find that Lee is competent to return to court for further proceedings.

Wiping away tears, Linda Lee, who is no relation to Francis Lee, said that she considered the mental evaluation a disguised blessing. She said it would give Lee time to talk to new lawyers and prepare an argument for withdrawing his guilty plea and standing trial.

"I believe that he's competent, and the judge just decided to send him away because he wanted to change attorneys," Linda Lee said.

When he pleaded guilty in March, Francis Lee argued that he had been entrapped by the government's undercover investigation. Prosecutors countered that the investigation began only after cooperating witnesses told authorities that Lee had asked whether any local drug dealers would be willing to invest in his club.

As part of his guilty plea, Lee agreed to forfeit all assets used in the money laundering scheme, including the Ritz. Two other men, Kerry C. Canavan, 45, and Henry D. Caldarazzo, 41, both of Baltimore, pleaded guilty earlier to conspiracy charges and Canavan agreed to forfeit his interest in Memories, an adult entertainment club in Baltimore County.

Until forfeiture proceedings are complete, federal prosecutors are in the unusual position of ensuring that the Ritz Cabaret continues operating and remains a viable asset for the government. Producers of an HBO drama set in Baltimore also have an interest in the club staying open at least until July because they signed a contract to use the Ritz as a central setting for the series before learning of Lee's legal troubles.

Assistant U.S. Attorney Martin J. Clarke asked in court whether anyone would operate the club in Lee's absence during the competency examination. Another defense attorney for Lee, J. David Ash, said the club's manager would keep the business running.

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