Ex-chief of Cleveland Flats Oxbow Thomas Newman embezzled $583,000, feds say (great job f.b.i.)

A two-count criminal information charges Thomas Newman with theft and embezzlement in a federally funded program, and money laundering.

"This defendant is accused of taking more than half a million dollars from an organization that was trying to improve our city," said U.S. Attorney Steven Dettelbach.

Federal prosecutors charged Newman in a four-page criminal information, rather than a grand jury indictment, which usually means the suspect is cooperating and intends to plead guilty.

Prosecutors also suspect that Newman used a Flats Oxbow credit card to pay for renovations at a six-story brick warehouse, registered in his wife’s name and located at 1250 Riverbed St. in the Flats.

The building houses Club Eros, which a website describes as a members-only adult entertainment swinger’s club open on Saturdays from 9 p.m. to 3 a.m.

Club owner Joe Esplandiu said he personally paid for all of the first-floor renovations at the building, and pays Newman monthly rent. "We did not get one penny from Tom or Dolores Newman," Esplandiu said.

But as the organization collapsed, City Councilman Joe Cimperman, whose ward includes much of the Flats, declined to fund the nonprofit.

Cimperman said in a telephone interview that he is angered by the charges.

"That money is supposed to yield other money," he said. "It’s supposed to help create jobs and spur development. There is a reason why there are problems in the Flats. It’s because the people who were supposed to be watching it were looking the other way."

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http://www.cleveland.com/metro/index.ssf/2012/11/post_69.html [1]

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