Property Developer Lost $900K for Regeneration Project at JACK Cleveland
Posted on: October 20, 2023, 04:40h.
Last updated on: October 20, 2023, 04:40h.
A Cleveland, Ohio property developer blew $885,000 on craps and blackjack at the JACK Cleveland Casino. But the money wasn’t his. It was supposed to go towards rebuilding a local market in the city’s Greenville district.
On Thursday, a jury in the federal court in Cleveland found Arthur Fayne, 61, guilty of nine counts of wire fraud, Cleveland.com reports.
Frayne was the owner of Business Development Concepts, which undertook community construction projects in the city.
He was selected by nonprofit Northeast Ohio Neighborhood Health Services (NEON) to oversee a project to revive the East Side Market in Greenville, whose closure in 2007 left the neighborhood with little access to fresh food.
Lost $1M
But federal prosecutors said $760K of the money Frayne took to the casino was intended to pay the project’s general contractor, AM Higley.
“Fayne concealed the invoices he received from AM Higley while submitting his own invoices to NEON seeking funds he claimed were for paying AM Higley. He then diverted to his personal benefit more than $750,000 of the funds intended for AM Higley,” according to prosecutors.
An additional $126K that ended up in casino coffers should have been sent to audio-visual contractor Crescent Digital, prosecutors said.
Fayne lost more than $1 million at the JACK Cleveland and at a casino while on a trip to New Orleans during the project according to court filings.
No public money was embezzled, just funds sent by NEON to pay contractors.
Defense lawyer Myron Wilson argued that Fayne’s only crime was being a sloppy bookkeeper who comingled funds in his personal and business accounts. Everyone who was owed money ultimately got paid, he stressed.
But prosecutors showed that Fayne had concealed invoices he received from AM Higley while submitting his own invoices to NEON seeking funds he claimed were for paying AM Higley.
No Hard Feelings
Nevertheless, NEON President and CEO Willie Austin and Crescent Digital President Mike Hines both testified they remained friends with Fayne, Cleveland.com reported. Austin said he still works with him.
Watson theorized that Fayne’s profligate gambling habit may not have endeared him to the jury.
Some people have a moral issue with gambling so that makes it more difficult,” Watson told Clevland.com. “He has given a lot to the community, to underprivileged areas, and to kids. He wants to help people. He’s done phenomenal work.
“Anytime you don’t agree with a verdict, you still respect the process,” Watson added. “It was clear that it was a highly contested case. Jurors were crying during the verdict, and I think that says a lot about the type of person Mr. Fayne is.”
Fayne declined to accept a plea deal that would have sent him to prison for two years. He now faces up to six.
Watson said he intends to appeal the verdict.
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Source: casino.org
