FBI arrests limo service owner, workers in racketeering probe

The owner of a longtime limousine service and two of his top aides were among those arrested by FBI agents Thursday in a multimillion-dollar racketeering conspiracy involving allegations of prostitution, drug trafficking and fraud.

Charlie Horky, 52, the CEO of CLS Nevada, a limousine service operating here since 1994, was released on his own recognizance late Thursday after pleading not guilty in court to conspiracy and fraud charges.

The company, which lists its address as 6430 Procyon Ave., calls itself a 24-hour chauffeur driven service that has contracts with a dozen Strip resorts.

"CLS is a very reputable company and well-recognized in this community," Horky's lawyer, Richard Schonfeld, said afterward. "We look forward to vigorously defending the case."

Kimberly Flores, 42, the manager of CLS, was released after entering a not guilty plea.

Archie Granata, 69, a financial adviser for the company, was arrested in Reno and was to make a court appearance there.

In all, nine CLS employees and associates were charged in a federal racketeering indictment unsealed Thursday that outlines a four-year criminal conspiracy.

Several other defendants were charged in related drug indictments that were still sealed late Thursday.

"The arrests today disrupted a major racketeering enterprise that has negatively impacted the citizens, safety, and image of Las Vegas," said Kevin Favreau, special agent in charge of the FBI for Nevada.

Nevada U.S. Attorney Daniel Bogden added: "Persons who use legitimate businesses to shield their criminal activities will get the attention of law enforcement. In addition to promoting prostitution and selling drugs, these defendants are accused of defrauding customers, many of whom were undoubtedly tourists to Las Vegas."

Also arrested on charges contained in the racketeering indictment were limousine drivers James Reda, 38, Clarence Adams, 38, Mikhail Maleev, 48, and Dawit Moszagi, 47.

U.S. Magistrate Judge George Foley Jr. released Reda and Adams on their own recognizance and ordered Maleev temporarily detained. Moszagi has a court appearance today.

Two company associates who are accused of having supplied drugs in the racketeering investigation, Solomon Zemedhun, 39, and Olive Toli, 48, also were arrested Thursday and remained behind bars after their court appearances.

The pair also are charged in a separate still-sealed indictment with possessing and trafficking in cocaine.

The indictment unsealed Thursday charges the nine defendants with conspiring to participate in an enterprise through a pattern of racketeering activities, including wire fraud, access device fraud, bank fraud, distribution of controlled substances, and the use of facilities of interstate commerce to promote, facilitate, and distribute the proceeds of prostitution.

They face sentences of up to life in prison and fines of up to twice the gross profits or proceeds from their criminal activity.

Prosecutors are seeking the forfeiture of $5.2 million, according to the three-count indictment.

The defendants used the limousine service to conduct the broad range of criminal activities from September 2008 through November 2012, the indictment alleges.

Drivers sold cocaine and methamphetamine and promoted prostitution from their limousines, the indictment alleges.

"The leaders and managers of the enterprise were aware of, encouraged and facilitated the distribution of controlled substances and facilitation of prostitution through CLS Transportation and its limousines," the indictment said.

Horky is alleged to have directed the criminal activities, requiring drivers to pay him a cut of the illicit money they were receiving,

Among the unlawful activities carried out was a scheme to defraud American Express and American Express card holders of more than $2.8 million through unauthorized charges, according to the indictment.

Horky led another check-kiting scheme that involved drawing checks on the company's payroll account knowing that the account did not contain sufficient funds, the indictment alleges.

More than $2.4 million in fraudulent checks are alleged to have been drawn in the scheme.

In court Thursday, Foley approved an agreement between prosecutors and Horky's lawyers that allows Horky to continue to run CLS Nevada while he faces the criminal charges.

Foley appointed attorney Tim Cory, a U.S. Bankruptcy Court trustee, to monitor the business to make sure it operates in a lawful manner.

Contact reporter Jeff German at jgerman@reviewjournal.com or 702-380-8135.