Sex, drugs, and city council

The $7,700 bribe paid to former Councilman Al Lipscomb wasn't about traffic cops hassling people at a bar, the way the city council and police chief make it sound. The man who paid Lipscomb was in trouble because his employees kept getting arrested for selling cocaine.

Pretty big difference.

Hey -- shouldn't we have known about the cocaine? I came across that information only because I asked to go through the exhibits the U.S. attorney had prepared for Lipscomb's trial last month in Amarillo, where he was convicted of taking bribes from a taxi company.

There it was, packaged up and pretty, ready to roll: Dallas Police Department arrest records, city of Dallas license review board procedures, all straight from city records and all of it evidence of a drug link to the Lipscomb bribe scandal.

You hear anybody from City Hall mention this? Was there a press conference? Did I miss something? All I heard about was the mayor and Southwest Airlines CEO Herb Kelleher and various clergy going up to Amarillo to say Al Lipscomb was a poor puppy dog who'd lost his way.

I'll ask it again. What about the cocaine?

When Lipscomb's taxi-bribe trial concluded, U.S. Attorney Paul Coggins revealed that Nick Rizos, owner of a defunct sex club called Caligula XXI on Northwest Highway, paid Lipscomb $7,700 in 1992. (Rizos has been given immunity by the feds in exchange for his cooperation.)

Coggins said the Rizos bribe evidence wasn't introduced at the Amarillo trial because it wasn't needed. Assistant U.S. Attorney Mike Uhl knew before the trial was over that he already had Lipscomb nailed on the taxi bribes. But a source close to the federal investigation, speaking on the condition that he not be identified, told me the information I saw in the box of government exhibits was evidence that would have been presented to the jury in explaining the $7,700 payment.

According to the exhibits, several employees of Caligula, which burned down in November and is the subject of an ongoing arson investigation, were arrested by Dallas vice officers in an eight-month period from late 1991 to the summer of 1992 for selling cocaine. The federal files contain specific arrest information for three employees whom police claimed to have observed selling drugs at Caligula. One of those arrested was charged in two separate cocaine incidents in a period of a few months.

The drug-arrest records were presented to a city board when the "sexually oriented business" license for Caligula was suspended for 15 days in May 1992. Rizos and his wife, Dawn Rizos, went to City Hall to try to get the suspension lifted.

Lorlee Bartos was chairwoman of the license appeal board that heard the case. "My recollection is that their place was one of the worst," Bartos told me last week. "They were doing lap dances, and they had drug sales going on. I'm not a prude. I think that part of society is always going to be there, but you need to regulate it."

Bartos remembers from her tenure on the license appeal board that some sex clubs in Dallas did obey the law and run their shops according to it. "I voted every time in favor of the Million Dollar Saloon, because every other business around them on Greenville Avenue always came in and said they were a great neighbor."

That's not her memory of Caligula, nor is it her memory of the Rizos family. "They would play these elaborate shell games, ownership flips within the family, so that they could say, 'Oh, no, that's not me that did that, that's that other guy who's no longer here.' It's like what every slumlord in Dallas does to stay a jump ahead of the law."

In fact, when I spoke to Dawn Rizos (her husband is out of the country), she told me that she did remember the drug arrests, but that all of it had to do with a bad partner, a relative who was involved in the business early on. "We had to split with him because he was just irresponsible," she told me on the phone. "It wasn't all cocaine. I think they were selling methamphetamines too. The waitresses were selling. We had a bunch of TABC [Texas Alcoholic Beverage Commission] violations."

The methamphetamines were news to me. I was taking notes pretty fast.

She told me that the bad partner was tossed out in 1989 and that after he was gone she personally instituted a system of locker searches and drug dogs to make sure no more bad people could come to work at her club.

We talked about the fact that the cocaine arrests and the 15-day license suspension happened in 1991 and 1992, two years after the bad partner had been sent packing and presumably after the locker searches and the drug dogs had been brought in. She said that all of the gentlemen's dry-hump clubs in Dallas were getting threatened with license suspensions in 1992. Her license was yanked, she said, because she had a bad lawyer. She got rid of that bad lawyer. Sent him packing too.

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Jim Schutze has been the city columnist for the Dallas Observer since 1998. He has been a recipient of the Association of Alternative Newsweeklies’ national award for best commentary and Lincoln University’s national Unity Award for writing on civil rights and racial issues. In 2011 he was admitted to the Texas Institute of Letters.
Contact: Jim Schutze