Arlington strip club owner previously indicted over $8M in alleged tax fraud
The company that owns the Arlington club where recent human-trafficking arrests were made was previously indicted in an $8 million tax fraud case in which executives were accused of bribing auditors with trips and cash to spend at strip clubs, according to court records.
Two managers of Chicas Locas, an adult entertainment club in Arlington, were arrested after a sex-trafficking investigation, local police announced this week. The club’s owner, Houston-based RCI Hospitality Holdings, which also owns many other clubs including Rick’s Cabaret in Fort Worth, was indicted after an investigation by the New York Attorney General’s Office last month, according to court records.
According to the indictment, RCI executives bribed an auditor with the New York Department of Taxation and Finance to avoid paying over $8 million in sales taxes to New York City and the state.
“RCI clubs use an in-house currency called ‘Dance Dollars’ that customers purchase and redeem for private dances. As part of its tax fraud scheme, RCI failed to collect and pay over $8 million in sales taxes on the sale of Dance Dollars,” the New York Attorney General’s Office said in a news release.
RCI’s President and CEO Eric Langan, 57, of Bellaire, Texas; Assistant Director of Nightclub Operations Shaun Kevlin, 45, of Warwick, New York; controller and accountant Timothy Winata, 71, of Houston; Director of Operations Ahmed “Ed” Anakar, 58, of Plantation, Florida; and Chief Financial Officer Bradley Chhay, 41, of Conroe, Texas, were named in the 79-count indictment and face charges including conspiracy, bribery, and criminal tax fraud, the release states.
RCI officials did not respond to the Star-Telegram’s request for comment regarding the human-trafficking investigation or the other criminal charges at the time of publication.
In a statement on the company’s website in September, an attorney for RCI denied the allegations.
“We are clearly disappointed with the New York Attorney General’s decision to move forward with an indictment and look forward to addressing the allegations,” Daniel J. Horwitz of the New York-based law firm Tannenbaum Helpern said in the company’s statement. “We remind everybody that these indictments contain only allegations, which we believe are baseless. RCI and the individuals involved are presumed innocent and should be allowed to have their day in court.”
“RCI previously disclosed the New York Attorney General’s investigation in its SEC filings,” the statement says. “As a publicly traded and audited company, RCI has a policy of paying all legitimate and non-contested taxes.”
Bribery investigation
Investigators said they determined that RCI bribed a former auditor and supervisor in exchange for “favorable treatment” during at least six different sales tax audits from 2010 to 2024.
“The auditor received at least 13 complimentary multi-day trips to Florida where he was given up to $5,000 per day for private dances at RCI-owned strip clubs, including Tootsie’s Cabaret in Miami,” according to the Attorney General’s release. The company also paid for the auditor’s hotels and restaurant visits during these trips, authorities said.
A company official provided the bribes to the auditor and accompanied him on trips to RCI clubs, according to the investigators. After one trip in February 2022, the auditor texted, “This was the best trip I had in Florida. The girls were very beautiful and nice. I hope we can have another trip before the summer,” according to the release.
The defendants also are accused of falsifying the business records of strip clubs and recorded the cash payments used to bribe the auditor as “promotional” expenses for the clubs, according to the release.
“In exchange for the illegal bribes provided to him, the auditor agreed to settle pending and future sales tax audits of RCI’s Manhattan strip clubs for substantially less in back taxes, penalties, and interest than were owed,” the release states.
Investigators also reviewed emails and texts in which the RCI executives discussed using trips to “help secure more favorable treatment from the auditor,” the release stated.
Other text conversations among the club owners in June 2023, reviewed by the investigators, included discussion like “got the guy to $47k in Vivid New York. But owes him a couple trips,” and “may need to pamper [the auditor] more this time,” the release stated.
“RCI’s executives shamelessly used their strip clubs to bribe their way out of paying millions of dollars in taxes,” New York Attorney General Letitia James said in the release. “I will always take action to fight corruption and ensure everyone pays their fair share.”