Michael McDonald Former city councilman has been focus of extended FBI investigation Rick Rizzolo FBI building racketeering case against Crazy Horse Too owner, a longtime friend of McDonald

Former City Councilman Michael McDonald does not believe in guilt by association.

And so far, neither do federal investigators who spent 18 months watching his every move.

McDonald says his ties to two embattled strip club owners have attracted needless scrutiny from FBI agents looking at possible criminal collusion between former elected officials and members of the adult entertainment world.

"I've always done everything by the book," McDonald said in an interview last month. "I've been biting my lip for three years, but I think everyone will be surprised when it's time for me to tell my side of the story."

McDonald said he wouldn't elaborate further until the investigations and trials involving strip club owners are over.

McDonald was not among the group of public officials indicted in November 2003 on charges of accepting bribes from strip club owner Michael Galardi.

McDonald was identified as a subject of the Galardi investigation and acknowledged that he had been a paid consultant for Galardi. McDonald would not say how much he was paid for his services.

Galardi pleaded guilty in the case and is expected to testify for the prosecution at the trial of former Clark County commissioners Dario Herrera and Mary Kincaid-Chauncey, which resumes Monday.

McDonald is not on the witness list for the trial, said Richard Wright, who is McDonald's attorney and who also is representing Kincaid-Chauncey.

The trial stemming from Galardi's alleged bribes is taking place as the government continues its probe of another strip club owner.

The FBI still is building a racketeering case against McDonald's longtime friend, Rick Rizzolo, a Galardi competitor and owner of the Crazy Horse Too Gentlemen's Club.

Wright said McDonald hasn't been called to testify before a grand jury hearing evidence in the Rizzolo case and wouldn't face charges when the more than a decade-long investigation is complete.

"If he was going to be indicted, I'd know about it," Wright said. "(Investigators) know more about McDonald than he does himself. ... He didn't do anything wrong."

Wright said that McDonald at the outset was one of the main figures being investigated in the case but that 18 months of surveillance and wiretaps earlier this decade turned up nothing against him.

Sources familiar with both strip club investigations say the trial of Herrera and Kincaid-Chauncey probably is only the prelude to a Rizzolo trial, one that could feature public officials either as witnesses or defendants.

Investigators are inching closer to wrapping up the Rizzolo case.

"We are aggressively pursuing the investigation into Rizzolo and Crazy Horse Too," FBI spokesman Dave Staretz said last week. "I don't know if we want to get into the details of proposed charges."

Earlier this year, Annette Patterson, Rizzolo's sister, testified before a federal grand jury investigating her brother, said her attorney, Terry Coffing. Patterson couldn't be reached for comment.

Coffing wouldn't give details about the nature of his client's testimony and criticized the investigation of Rizzolo.

"I know if I'm going to fish in the same hole for 10 years and not catch anything, it's time for me to move on," Coffing said. "Not everybody associated with adult businesses is a criminal."

Repeated calls to Tony Sgro, Rizzolo's lead attorney, were not returned.

Of McDonald's part in the investigation, Staretz said only, "He obviously played a role."

Staretz declined to comment on whether McDonald would face charges or on whether he would be a government witness against Rizzolo if the strip club owner is indicted.

Wright said McDonald would testify against Rizzolo at a potential trial only if he is offered immunity from prosecution.

Staretz referred further questions about the case to federal prosecutors in Las Vegas.

Natalie Collins, a spokeswoman for the U.S. attorney's office, declined comment on the investigation.

For his part, McDonald said he has no reason to distance himself from either Galardi or Rizzolo. "I grew up knowing Mike (Galardi) and have known Rick (Rizzolo) for the longest time," McDonald said. "I was born and raised here. ... I've known a lot of people."

McDonald has said he abstained from voting on matters involving Galardi's and Rizzolo's businesses during his time on the city council from 1995 to 2003.

McDonald also has said he had a policy of rejecting campaign donations from strip clubs, so Rizzolo and Galardi didn't appear on any of his campaign reports.

But the former bike patrol officer and two-term councilman caught flak from a now-defunct city ethics commission for his behind-the-scenes work on behalf of Rizzolo.

In November 2000, the city's Ethics Review Board found that McDonald had worked actively to thwart a strip club from going up near the Crazy Horse Too on property owned by political consultant Sig Rogich.

The board also determined that McDonald had acted improperly by trying to get the city to buy a financially struggling sportspark owned by his former boss, Larry Scheffler.

McDonald never faced criminal charges stemming from his actions.

In the strip club incident, McDonald acknowledged asking two city employees to resurvey land near the proposed business after a church owned by Annette Patterson opened near the site, a twist that prevented the rival strip club from going up.

The Crazy Horse Too, its owner and his employees have a long history of controversy.

Robert D'Apice, a shift manager at the strip club, was indicted last year on a charge of using force to compel customers to pay disputed charges.

D'Apice is scheduled for trial on Oct. 16. There have been five requests to postpone the trial date since D'Apice was indicted.

At least four civil lawsuits have been filed against Crazy Horse Too stemming from allegations that club employees assaulted patrons.

Amid these legal problems, Rizzolo has remained a major player in local politics.

Rizzolo, his family and his business associates have contributed at least $40,000 to Mayor Oscar Goodman's campaigns.

Rizzolo has supported Goodman, and the mayor is quick to defend the strip club owner.

"I like Rick Rizzolo," Goodman said. "He goes to Piero's every Thanksgiving and feeds hundreds of needy people. And he treats them with dignity."

Now working exclusively in the private sector, McDonald said he also is seeking ways to help people.

McDonald is the owner of Alpha Omega Strategy, a consulting firm that is working to develop a housing project for senior citizens on fixed incomes.

"It's something we've been trying to get off the ground for a long time," McDonald said. "I think we have a great opportunity to do something positive here."

But even that project has been bogged down in controversy.

Condominium owners near the site of the senior center at Decatur Boulevard and Vegas Drive have claimed in a lawsuit against the city that they were coerced into selling their properties to clear space for McDonald's project.