Aug. 2, 2001 -- The owner of the Gold Club, accused of paying dancers to have sex with his celebrity clientele and cheating his customers, pleaded guilty today to one count of racketeering and agreed to give up the Atlanta strip club.
As part of the plea deal, Steve Kaplan also agreed to pay a $5 million fine and serve a three- to five-year prison sentence. The federal government will be in charge of the Gold Club temporarily.
Kaplan, who is worth an estimated $50 million, will have a formal sentencing hearing in two to four weeks. He remains free on bond.
He could have faced 195 years in prison if convicted on all charges. One charge of racketeering has a maximum sentence of 20 years.
Looking Out for His Friends
Steve Sadow, Kaplan's attorney, said his client accepted the plea bargain after 14 weeks of testimony because he wanted to do what was best for his employees and friends linked to the Gold Club.
"It was a very good deal for all concerned but most importantly, as [far] Steve Kaplan is concerned, those that have been friends and employees for years now know that they fear no loss of freedom," Sadow said. "They have a guaranteed future and that was always the most important thing in this case. And once that was accomplished, we got what we wanted.
"I would not call Steve Kaplan a fall guy," Sadow continued. "I would call Steve Kaplan someone who understands the need to repay the loyalty and friendship of those people that were on trial with him."
Kaplan and six others were charged with obstruction, credit card fraud, loan-sharking and prostitution, among other charges. Prosecutors said Kaplan funneled profits from the Gold Club to New York's Gambino crime family.
Three of his co-defendants pleaded guilty to a single charge each of concealing a felony and will receive a year's probation. Gold Club managers Norbert Calder, 35, and Roy Cicola, 35, and dancer Jacklyn Bush, 32, will be sentenced on a later date. The maximum sentence for concealing a felony is three years in prison and a $250,000 fine.
The plea agreements must be approved by U.S. District Judge Willis Hunt.
Star-Studded Trial — and a Key Witness
It is not clear if the three remaining defendants — Gold Club accountant Larry Gleit, former Atlanta police officer Reginald Burney and Michael "Mikey Scars" DiLeonardo, an alleged captain of the Gambino crime family — will also accept plea deals.
"We haven't agreed to anything," said Burney's lawyer, Dwight Thomas. "We'll always listen, but we haven't agreed to anything."
The trial suddenly stopped Wednesday when lawyers began plea negotiations. The plea deals were prompted by the testimony of former club manager Jeff Johnson.
Originally named in the indictment against Kaplan, Johnson eventually began to cooperate with the government and testified Tuesday that he saw Kaplan direct three strippers to perform sex acts on Denver Broncos star running back Terrell Davis and a friend. Kaplan, Johnson said, paid each of the women $200.
NBA star Patrick Ewing and Atlanta Braves outfielder Andruw Jones admitted on the stand that dancers gave them sexual favors in the club, but they said they did not pay the strippers. Other witnesses, however, claimed Kaplan paid them. None of the celebrities was charged with crimes.
Witnesses testified that Kaplan thought celebrities would attract business and bring the Gold Club notoriety. Some club patrons testified that they were unknowingly charged unusually amounts on their credit cards after spending time in the club's VIP rooms.
Defense attorneys claimed the sex with customers was consensual. Many of the clubs customers, they argued, willingly signed credit card receipts and onlychallenged the charges because they were embarrassed about their association with the Gold Club. ABC Affiliate WSB-TV in Atlanta contributed to this report.