Two years ago, Manhattan prosecutors subpoenaed hundreds of boxes of documents from the Scores strip-club empire.
But despite what investigators admit were signs of fraud, embezzlement, and the overcharging of drunken customers, prosecutors closed the Scores case last week with little to show for it.
Owner Richard Goldring and manager Harvey Osher wriggled and jiggled their way out of a criminal maelstrom virtually unscathed, getting to keep their clubs and pay just the barest of penalties despite what DA Robert Morgenthau had called a “massive” and “flagrant” skimming of at least $3.2 million.
How’d they do it?
Essentially through dizzying excess – the same strategy by which they’ve bewitched countless loyal patrons.
When investigators opened the hundreds of boxes, they found a morass of paperwork – and what sources described as an intricate web of dummy corporations, consulting companies and sublicensing agreements.
The trail of money from dancer’s garter to management’s pocket was simply too tangled even for a team of prosecutors to untangle in a reasonable amount of time, sources said.
“It’s a web of money movement and companies and payouts, and the technical and legal issues get really complicated,” said one source familiar with the investigation.
“This was an investigation that went on a long time, and a cost-benefit decision was made.”
Added another source, “At the end of the day, it was decided, ‘Let’s just get a couple of felonies out of these guys, and move on,’ ” the source said.
Under last week’s deal, Goldring, 36, of Watchung, N.J., must divest himself of the most allegedly fraud-ridden arm of the Scores empire – Scores Holding Company, the publicly traded entity that licenses 10 spin-off clubs around the country.
Osher, 38, of Matawan, N.J., must serve four weekends in jail. Both must cooperate with tax officials in repaying whatever they owe. But Scores carries on, with the pair at the helm.
“It’s a disgrace; it’s total incompetence,” said one police source familiar with the investigation. “The cops who worked on this all feel the same about it.
“Why can you still smoke in Scores? How can they still keep their liquor license when one owner is a convicted felon, and the other is charged with stabbing someone?” he said.
The reference was to Osher’s brother Elliot, 45, charged with knifing former employee Bakir Balaban, 39, around the corner from the club on March 23.
“They are above the law,” the angry cop said.