World Headquarters ...my ...

Submitted by lmcshane on Tue, 04/17/2012 - 21:21.
World Headquarters ...my ...
( categories: )

your name here...

Yeah...it's really working for us...crap shoot city...that good ole land bank...

Who is Lou Frangos robbing today?

Published: Tuesday, June 07, 2011, 10:36 AM     Updated: Wednesday, June 08, 2011, 9:32 AM

  By matchingwits vcard">cleveland.com
 
 
 
Todays entry will be the first in a series of 20 different instances where someone has been fleeced by Lou Frangos, parking lot "magnate" and sacred cow of Cleveland. Despite the fact that every bit of the information I will write about has been reported to the FBI, no investigation has been initiated. Is this the proverbial license to steal? It sure looks like it.

We should start with a cursory search of Louis Frangos in public databases, to determine what his public profile says about the man.

In the Cuyahoga County Clerk of Courts site, criminal case search; Frangos has :
Passing Bad Checks, 6 counts
Grand Theft, 2 counts

In Google search, it looks like a partial scrub has taken place; as much of the negative entries are pushed back away from the first few pages. Most likely a reputation defender type service attempting to paint a better picture.

There are two entries by Business Journal, located in Mahoning Valley, which reports on the Youngstown area appearing on page one. They detail his struggles to avoid paying his bills and cheat his investors on a project to develop the Realty Towers apartments.

For the readers who may not be aware: Frangos operates large parking lot operations in both Cleveland and Youngstown under the name USA Parking. This largely cash oriented business has provided capital necessary to shuffle back and forth as he tries to simultaneously portray himself as a wealthy, successful businessman and commercial developer.  This facade is where he gains entry, as Frangos gathers the politicians like the pied piper with cash to lavish on them and promises of grandiose dreams; developing downtown properties. He may have difficulty (re: willingness) to pay his debts, but he loves to pay bureaucrats and politicians to keep the scheme going.

Lets explore one of the many properties Lou has in his portfolio.

The Cleveland Career Center
1020 Bolivar Rd
Cleveland, Ohio 44115

An old Ohio Bell building which languished for years in decay, Frangos struck a deal with the City of Cleveland (which politician benefited from this?) to redevelop it. It now houses city and county employees, under the workforce development services; opened in May 2007. He takes in $72,000 per month in rent for two floors of this building, paid for by the taxpayers. ( side note: I wonder how many police officers and fire fighters jobs could have been saved if not for this expense?)
The construction company that managed this 8 million dollar project was D A S Construction (another tie to the county corruption scandal), and after the renovation was complete, as always happens with Frangos the obligatory list of unpaid contractors appeared. He was able to shield himself from non-payment using DAS as the fall guy. Interesting to note that nonpayment in another project and subsequent litigation of the debt was the downfall of Judge McCafferty and Steve Pumper of DAS.
As all self proclaimed "developers" do, Lou Frangos does not use the majority of his own money to finance these projects, he can't. His rob Peter to pay Paul style would preclude him from stalling a stack of cash when it is desperately needed to cover his trail of deceit. He solicits money from the "connections" at his disposal, politicians. Whether its grants, loans or tax subsides; he reaches out to those palms he greased for money. But even the taxpayer monies are not enough to cover the large costs, he has sought "investors".
Some wealthy players in downtown real estate have rolled the dice on Frangos, the latest is Dan Gilbert and his casino group. I hope Mr Gilbert has done his due diligence in background checking Lou.
Others who have dealt with Frangos on past deals and may not be aware of their status as victims of investor fraud are Hal Lapine and Tom Embrescia. Yes, investment fraud. As Lou signs deals with investors and has a payment schedule for returns; he sends out investor statements. Those statements list the "supposed" costs associated with the property and are deducted from the returns. Those costs are fabrications, lies and outright deceptions. He has a staff of employees who help prepare these statements, knowing that its a complete falsehood. (at this point, please open another tab and search RICO in Google). Where is the FBI in this?
You would think that taking in $72,000 per month on a property would be enough to satisfy the overhead costs like mortgage and construction loans, taxes, utilities etc. Nope, Lou Frangos was short on cash and used the rent money on other parts of his scheme, ignoring the loan payments and sending this building into the beginning stage of foreclosure. My question is: did he charge his investors their fair share of the costs while not paying? 
If the city of Cleveland would like an easy way out of this mess, I would suggest reviewing the lease contract. He is not supposed to operate the parking garage in this building for special event parking during the specified work hours when it is dedicated to the Career Center and clearly spelled out in its lease agreement. Would someone point this out to Joe Cimperman?