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Chula Vista's cleanup act

“I wonder if city politicians got contributions from the card club?

Not business-as-usual nowadays at Seven Mile Casino
Not business-as-usual nowadays at Seven Mile Casino

EyeCandy, a nude dancing establishment, opened in Chula Vista in October 2012. Seven Mile Casino, a gambling establishment, opened on the same street as EyeCandy in August 2015. EyeCandy is gone for good, and Seven Mile Casino faces legal challenges and continued FBI scrutiny.

On December 9, the FBI raided Seven Mile Casino for the second time in two years. The Palomar Club in San Diego was also raided. As the Union-Tribune reported, the raids resulted in 25 indictments with a smorgasbord of charges, including money-laundering, prostitution, illegal bookmaking, illegal poker, and blackjack business. Harvey Souza, the owner of Seven Mile Casino, was charged with “failure to maintain an anti-money-laundering program.”

Souza will have his day in court and Seven Mile Casino’s license will go before the California Gambling Control Commission, but for now the establishment will open under strict provisions, including “engaging a manager approved by the bureau of Gambling Control.” The manager will provide the bureau with weekly statements of Seven Mile deposits, profits, losses, withdrawals from players’ accounts, and so on.

A statement released by Seven Mile Casino says: “As a family and as a business, they are very much invested in the community of Chula Vista and the industry. We look forward to working with the California Bureau of Gambling Control to resolve all issues.”

Chula Vista unsweetened

Chula Vista filed suit against EyeCandy in 2013, maintaining, among other things, that EyeCandy was located in a mixed use/residential zone. In August, superior-court judge Richard Strauss ordered EyeCandy owners, Jake and Waldon R. Welty, to close. Roger Diamond, attorney for the Weltys, filed an appeal and felt confident he would prevail in appellate court. But in a December 10 interview, Diamond said his clients came to a settlement with the City of Chula Vista and withdrew their appeal.

Diamond said the case hinged, in part, on whether EyeCandy was judged to be located on E Street or on Bay Boulevard. His clients purchased the property, a former Anthony’s restaurant, on 215 Bay Boulevard, which complied with the necessary zoning. Ultimately, the judge ruled that EyeCandy was also on E Street and therefore within 500 feet of the E Street trolley stop, which is zoned mixed/residential.

“The property only failed by 25 feet,” said Diamond. “We literally could have amputated part of the property. I even said to the city we’ll save the taxpayers a lot of money, we’ll stipulate that if the city ever wants to build a residence on the trolley-stop property, we’ll leave. They didn’t want that, they preferred to spend a million dollars in fees to fight the case.”

Diamond conceded, “The judge ruled against us.” But, Diamond said his clients won on attorney fees. “The judge ruled against the city and ruled the city was entitled to nothing. The city was confident they were going to get over a half a million dollars [in legal fees]. They claimed in the court they were only seeking a portion of the fees incurred. We’re going to split out-of-pocket fees for things like court recording, which came to about $55,000."

An October public-record request yielded this response: “To date the City of Chula Vista Attorney’s Office has reviewed, approved and paid $380,425.97 in litigation costs in the matter of City of Chula Vista v Bay & E (EyeCandy). Please be advised that there are pending invoices….”

Diamond continued: “Now the city is free of the strip club, but it’s out an awful lot of money and the property sits empty. Vacant property is never good. You’re better off with some presence like security guards, employees, and clients. If the city were smart they would allow a club to be reinstated. “

Diamond compared Seven Mile Casino to EyeCandy:

“My clients got to operate for a couple of years. There was no alcohol in the strip club, so we didn’t have problems with intoxication. There was zero evidence of prostitution. We had undercover agents all the time. There was one altercation in three years.

“It’s all very amusing to me. Strip club dancing, erotic burlesque-type dancing, traditionally is an American art form. According to the courts, it is presumptively protected by the First Amendment, whereas neither gambling nor marijuana are protected. So between gambling and a strip club, I would think that the strip club would be less of a problem for the city than gambling, but the city seemed to brag about their gambling facility.

“I wonder if city politicians got contributions from the card club? Mr. Welty [the owner] didn’t engage in bribery.”

Souza, the owner of Seven Mile Casino, is known for his generosity to local politicians.

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Not business-as-usual nowadays at Seven Mile Casino
Not business-as-usual nowadays at Seven Mile Casino

EyeCandy, a nude dancing establishment, opened in Chula Vista in October 2012. Seven Mile Casino, a gambling establishment, opened on the same street as EyeCandy in August 2015. EyeCandy is gone for good, and Seven Mile Casino faces legal challenges and continued FBI scrutiny.

On December 9, the FBI raided Seven Mile Casino for the second time in two years. The Palomar Club in San Diego was also raided. As the Union-Tribune reported, the raids resulted in 25 indictments with a smorgasbord of charges, including money-laundering, prostitution, illegal bookmaking, illegal poker, and blackjack business. Harvey Souza, the owner of Seven Mile Casino, was charged with “failure to maintain an anti-money-laundering program.”

Souza will have his day in court and Seven Mile Casino’s license will go before the California Gambling Control Commission, but for now the establishment will open under strict provisions, including “engaging a manager approved by the bureau of Gambling Control.” The manager will provide the bureau with weekly statements of Seven Mile deposits, profits, losses, withdrawals from players’ accounts, and so on.

A statement released by Seven Mile Casino says: “As a family and as a business, they are very much invested in the community of Chula Vista and the industry. We look forward to working with the California Bureau of Gambling Control to resolve all issues.”

Chula Vista unsweetened

Chula Vista filed suit against EyeCandy in 2013, maintaining, among other things, that EyeCandy was located in a mixed use/residential zone. In August, superior-court judge Richard Strauss ordered EyeCandy owners, Jake and Waldon R. Welty, to close. Roger Diamond, attorney for the Weltys, filed an appeal and felt confident he would prevail in appellate court. But in a December 10 interview, Diamond said his clients came to a settlement with the City of Chula Vista and withdrew their appeal.

Diamond said the case hinged, in part, on whether EyeCandy was judged to be located on E Street or on Bay Boulevard. His clients purchased the property, a former Anthony’s restaurant, on 215 Bay Boulevard, which complied with the necessary zoning. Ultimately, the judge ruled that EyeCandy was also on E Street and therefore within 500 feet of the E Street trolley stop, which is zoned mixed/residential.

“The property only failed by 25 feet,” said Diamond. “We literally could have amputated part of the property. I even said to the city we’ll save the taxpayers a lot of money, we’ll stipulate that if the city ever wants to build a residence on the trolley-stop property, we’ll leave. They didn’t want that, they preferred to spend a million dollars in fees to fight the case.”

Diamond conceded, “The judge ruled against us.” But, Diamond said his clients won on attorney fees. “The judge ruled against the city and ruled the city was entitled to nothing. The city was confident they were going to get over a half a million dollars [in legal fees]. They claimed in the court they were only seeking a portion of the fees incurred. We’re going to split out-of-pocket fees for things like court recording, which came to about $55,000."

An October public-record request yielded this response: “To date the City of Chula Vista Attorney’s Office has reviewed, approved and paid $380,425.97 in litigation costs in the matter of City of Chula Vista v Bay & E (EyeCandy). Please be advised that there are pending invoices….”

Diamond continued: “Now the city is free of the strip club, but it’s out an awful lot of money and the property sits empty. Vacant property is never good. You’re better off with some presence like security guards, employees, and clients. If the city were smart they would allow a club to be reinstated. “

Diamond compared Seven Mile Casino to EyeCandy:

“My clients got to operate for a couple of years. There was no alcohol in the strip club, so we didn’t have problems with intoxication. There was zero evidence of prostitution. We had undercover agents all the time. There was one altercation in three years.

“It’s all very amusing to me. Strip club dancing, erotic burlesque-type dancing, traditionally is an American art form. According to the courts, it is presumptively protected by the First Amendment, whereas neither gambling nor marijuana are protected. So between gambling and a strip club, I would think that the strip club would be less of a problem for the city than gambling, but the city seemed to brag about their gambling facility.

“I wonder if city politicians got contributions from the card club? Mr. Welty [the owner] didn’t engage in bribery.”

Souza, the owner of Seven Mile Casino, is known for his generosity to local politicians.

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Comments
38

The strip club claimed to be another kind of business back before they got in there. They don't need to be where kids get on and off the bus. Whoever likes that will find them. Bet the same gamblebum politicians have been making it easy to let school money stay lost to boys like Brand. How are those property deals anyway? Anybody got a moral compass?

Dec. 13, 2015

So Chula Vista wants to promote an "entertainment sector" or something to that effect.

Money laundering is not going to encourage much in the line of good entertainment, unless amusement is found in drugs, gangs and the associated crimes. Possibly down the line there might be some screenplays written, but I don't think that is what our "civic leaders" are interested in.

If you want to build up the waterfront, you need to have businesses that attract families. You need parks and recreational areas. You need view restaurants, you need venues that allow musical performances, you need nice plazas, you need nice places to stay. You need appealing events.

I have to conclude that the donations from Mr. Souza did affect the votes and behavior of our council members and mayor.

I am glad that EyeCandy is no more--as shirleyberan mentioned, that business was misrepresented to the city of Chula Vista, and early on, various reports mentioned the litigious background of the owners (wherein they would essentially hold a municipality for ransom and then leave if they were offered enough money).

Will Chula Vista ever get the type of civic leadership that acts for those of us who live here, or will we be forever stuck in a limbo of backwoods thinking, backwater planning and backward motion. Forward motion would be recognizing the positives we have and building on those. Is that impossible?

Or are our "leaders" incapable of recognizing the difference between positive and negative?

Dec. 13, 2015

Our "leaders" are bought and paid for long before we get to vote. Money talks and thus the "lesser" areas (west of 805) do not have the money to compete with the east of 805 folks. When I lived and worked in CV it was mostly blue collar workers with families now it is a place I would not pick as a place I would want to live.

Dec. 14, 2015

Chula Vista, once the pearl of the So Bay - chosen by many Navy personnel as a place to call home - has, for many reasons changed, and NOT in a good way. The west side, is being allowed - little by little to deteriorate and many fed up long time residents are pulling up stakes and moving.

How City leaders can allow our streets to become mobile homeless shelters, Parks (between C and D) to be overrun with drug addicts and parking lots behind Third Avenue to become smelly urinals is simply beyond comprehension.

Dec. 13, 2015

There's no money as in campaign contributions to be gained in cleaning up the local parks, or in repairing the streets, or in upgrading the water mains, etc., etc. Is this going to be a replay of the school scandals of the past few years?

If this is the beginning of a new round of So County corruption, Susan will have her work cut out for her.

Dec. 13, 2015

Chula Vista "allows" homeless (those living unsheltered)...interesting statement. Chula Vista has few services for those living unsheltered that don't come from faith-based organizations or other non-profits. We send those needing assistance outside our own community (which is a topic for another thread/article).

Dec. 14, 2015

the casino bothers me a lot more than the strip club. the casino is much more destructive, more opportunities to ruin lives. I have seen too many people with gambling problems blow the rent money then resort to petty crime to finance the habit. not to mention the ability to launder cartel money.

Dec. 13, 2015

Poltical contributions?? Look no further than "consultancy fees" from 7-Mile to Cheryl Cox, ex-Mayor of Chula Vista, and wife of SD County Supvr. Greg Cox.

Dec. 14, 2015

I have no problem with the gambling issues. The problem is oversight. Money laundering and prostitution are inherent problems with gambling. Our proximity to the boarder is also a concern. The CV city council embracing the gambling issue knowing that there were previous issues is concerning. I guess it's all about $$$$$.

Dec. 14, 2015

Eastlaker,

Regarding building up the waterfront, the location of the former EyeCandy is a pretty spot, and it's right across the street from the Living Coast Center. And it's one of the entryways to the city of Chula Vista. It could be a destination place--themed somehow to go with the Living Coast as a restaurant. Will the existence of a legally-troubled gambling establishment make the EyeCandy corner lot less appealing?

Dec. 14, 2015

Mayor Salas has now been to Paris. Maybe she will have learned something about creating beautiful civic spaces that contribute to people's lives, creativity and the means to bring together a community spirit. Not to mention learning more about what more solar power can mean to this area.

Let's hope that our civic leaders start really using their higher reasoning powers to bring about what this community can be--there is no future in pandering.

Dec. 15, 2015

Some have said EyeCandy duped the city when they deceivingly listed themselves as "Amber Hand Entertainment, Inc. Chula Vista Comedy Club" on their license application. They did, and it was obviously wrong, and unacceptable. But, did the city do any checking... at all? Maybe they could've done a simple google search of Mr. Welty or his lawyer Mr. Diamond?  Didn't the city's building inspectors wonder what the stripper poles on a dance floor were for?  Regarding the 7mile Casino, how could the city, with the chief of police's blessing, approve the expansion of an establishment that was under investigation and had recently been raided by the FBI? If the casino's Mr. Souza is found guilty, then the politicians owe it to the taxpayers to offer all of the donations they received from him to be deposited into the city's legal fund. Whether or not one likes gambling or strip joints, we shouldn't have to pay for the city's lack of due diligence.

Dec. 14, 2015

Who needs DAYS OF OUR LIVES?

Dec. 14, 2015

Sometimes people who write on these threads do so just to try and feel important to themselves. You should know all the facts before you start to judge things. If you notice the only person in the Casino that was arrested was the Owner. All others arrested were not patrons of the casino and did not even come to the casino and the prostitution and other offenses did not occur at this casino. The Casino is a really nice place with good food and good people. The ones arrested put the casino in a bad situation by taking advantage of a place to launder money. The owner was not arrested for laundering money. The Casino provides jobs to many people also. The Casino is in a place where nothing else can survive and thats why the building were available. The Casino makes good revenue for the city of Chula Vista. I guess you would rather all the patrons go to Barona or Sycuan and all the money go the the Indian Reservations. It does not matter where the casino is located, people who want to play poker and table games will go to those places so closing does not help people who are addicted. I go to the Casino to relax and play poker responsibly, I enjoy it for entertainment like many others. If you have not been to the Casino then don't make any assumptions about what goes on there. Of course politicians take money from Mr. Souza because he is a good man of the community. Maybe thats why he has had a business here for so many years. Everybody has different opinions and that is ok, If you don't like gambling then stay out of the Casino. I don't care about the strip club, never been there because its not my deal. Sex freaks need a place to go so they don't look elsewhere and rape or something. Sometimes these places have a hidden good point. I appreciate everyones point of view and I hope you will respect other peoples point of view.

Dec. 14, 2015
This comment was removed by the site staff for violation of the usage agreement.
Dec. 14, 2015

So I guess you don't agree with my comments so you resort to a personal bash about where I work or what I do. Oddly enough as you say, you could not be more wrong. I visit the casino maybe 2 hours a week to relax and eat and play poker for a bit. I am a 30 year Retired Navy Disabled Veteran and I own a business so I guess your not as smart as you think. Since you can't figure out my real point I can spell it out for you. I was simply making a comment on the side of the casino because I think it has more good qualities than bad for the community such as providing jobs and money for the city. Other people wrote their opinions and I so wrote mine. If you can't make comments without being attacked then why have a forum. I guess you only want comments that agree with yours on here. Have respect for other peoples opinions. I am not an employee of the casino nor am I an investor of any sort so get off your high horse. I just enjoy entertainment of a little poker sometimes and don't want to see the place close. There are other places to play but this is a classy place. I am sure you are a great member of society but that does not mean if I don't agree with you that you have to bash me.

Dec. 15, 2015

Why should we not bring awareness of corrupt econimics in Chula Vista so you can feel comfortable and ignore a long-standing problem hidden from the public?

Dec. 15, 2015

Visduh, thank you for the confidence...I have my own tack, but I think Greg Moran of the UT has done a good job breaking these stories with solid background information so the reader can follow the sequence.

In a piece by NBC7's Wendy Fry last night, she quoted Souza's PR person Dan Hom as saying there are 350 employees who need to get back to work.

This story has many legs. How 7mile is handled in Chula Vista will be one of them....

Dec. 15, 2015

ktmitch - 'I appreciate everyone's point of view' conflicts with your opening sentence 'sometimes people who write on these threads do so just to try and feel important to themselves'.

My opinion, for what it is worth, is - each of us makes our own choices - no one puts a gun to the customers of strip clubs or card rooms and forces them to patronize. Having said that, while I have seen the effects of a family member addicted to gambling and one who patronized the establishment mentioned in this article - I DO NOT PLACE THE ONESS ON THE ESTABLISHMENT, but rather the individual. Having said that, if the allegations are true and the judicial system finds them guilty then,,,,, they will, like my family member, be forced to suffer the consequences of poor choices.

Dec. 15, 2015

anniej- you are right, bad opening statement and I retract, I apologize for the comment. My wife's cousin lost 2 houses, cars, wife and business to the Village Club. He goes to all the casinos and card rooms in the area. The family has tried to help but he refuses. For the addicted ones they will find a place to gamble and won't stop until they get help. I do think the owner and the parties should get what the system decides but I just think we should all have a open mind on others lifestyles and opinions. Thanks for your comments.

Dec. 15, 2015

Eastlaker - while being invited to Paris is no doubt an honor - I am having difficulty in her promotion of all CV is doing right when there are neighborhoods she is responsible for 'going to hell in a hand basket' - perhaps rather than flying to Paris she might want to drive down 4th avenue at night, headed south from City Hall, slow down when you get to the library on Orange, - then, then Ms. Sala tell me again about how great our City is and remind me of what you and the Council are doing to take this City forward.

Dec. 15, 2015

Do we have estimates of the number of homeless in Chula Vista? I have seen one individual around my neighborhood for the past several years who appears to be "living rough".

I have seen a few others occasionally, wearing backpacks, who might be homeless but I can't really determine.

So is there data on the scope of the problem of homelessness in Chula Vista, especially as we experience colder than usual temps?

Dec. 15, 2015

Chula Vista's homeless population totals nearly 500, according to the 2015 annual count conducted by the Regional Taskforce on the Homeless. The count is of sheltered and unsheltered homeless and is intended to provide a snapshot of how many people are homeless on a given night.

Dec. 15, 2015

AnnieJ - means more well adjusted kids when parents have fair choice of venue. Correct?

Dec. 15, 2015

Eastlaker - my reference to driving down 4th at night was in hopes that Ms. Salas and the City Council might have the opportunity to see what I see every other week when driving home from a School Board meeting - motor home after motor home (lights flickering from within) with an occasional 18 wheeler here and there, then there is the SUV owner sitting outside of his vehicle watching his big screen big screen mounted on the hood (I am not kidding)!

But the icing on the cake is driving down the same street EARLY IN THE AM watching some of those inhabitants pouring buckets of ? down our City drains.

AND THEY WONDER WHY I KEEP HARPING ON THIS SUBJECT!!!!!

Dec. 15, 2015

shirleyberan - personal note

HAPPY HOLIDAYS - sending wishes for a healthy happy 2016!!!!!

Dec. 15, 2015

yeah, nice to go to Paris but in the meantime CV continues to draw the short end of the stick in SD county, all of the food stores near me are closed down and we took our eye off the water rate ball so SD and north county are going to screw us on the rates, the homeless are getting to be out of control, try using the open space near the home depot on H street or the parks near city hall. Instead of Paris, how about paying attention to things closer to home?

Dec. 15, 2015

homeless issue: http://www.sandiegouniontribune.com/news/2015/nov/19/tp-cv-wrestles-with-homeless-population-electe/

Chula Vista's homeless population totals nearly 500, according to the 2015 annual count conducted by the Regional Taskforce on the Homeless. The count is of sheltered and unsheltered homeless and is intended to provide a snapshot of how many people are homeless on a given night.

Dec. 15, 2015

We are not supposed to digress, but on the homeless issue....I met an attorney recently while attending a courtroom case. She was part of a group called GirlsThinkTank. The group purchased a mobile shower/bathroom. They give free legal advice to the homeless at the San Diego library once a month, and they do a cleanup of a various parts of the city once a month. You can look them up online. I was impressed.

There aren't many services in Chula Vista.

Dec. 15, 2015

Didn't mean to hijack the thread!

But-----part of the problem is that when there are places that help the homeless, some neighbors complain that those very services "encourage" more homeless people to gather in that area. I can't come up with anything that will solve the problem, but I agree with you about the GirlsThinkTank activism. What do the local homeless do when it gets below 50 degrees here?

Dec. 15, 2015

Ms. Luzzaro: our intent was not to hijack, rather,,,,,, borrow for a bit.

THANKS FOR ALLLLLLLL OF THE GREAT INTERESTING STORIES!!!!!

another hijack -

HAPPY HOLIDAYS AND A HEALTHY BLESSED NEW YEAR TO ALL!!!!!!

Dec. 15, 2015

KT - your comments must be addressed as you say. Women are not rape victims until they say.

Dec. 15, 2015

I don't get what you are saying, I didn't make a comment about women being rape victims.

Dec. 16, 2015

ktmitch - no harm, no foul. The devastation of addiction - in my case my family members poor choices affected his children - a side of the disease that left scars felt to this very day. Your comment 'they WILL find a place to gamble' - so very, very true.

Dec. 16, 2015

Here is Greg Moran with more of the backstory on California gambling. Interesting article:

http://www.sandiegouniontribune.com/news/2015/dec/12/card-club-problems/?platform=hootsuite

Dec. 16, 2015

Susan, would the U-T give you credit for your exposes, and provide a link for their subscribers/readers to your articles? Of course not. You and the Reader are most professional in giving them credit when they never reciprocate.

Dec. 16, 2015

AnnieJ - Happy New Year!! 2016 and there's still unfinished business. Hoping The Truth Will Be Revealed. I know more about my family dynamics now. Sometimes there is no common ground. Taking from kids and walking away as if you're not a bully requires two-faces (one for the public), "See me, I have degrees in education and higher learning, Trust Me." Bah! Humbug! I'm still ill-tempered and unmeasured. Thanks So Much To Susan Who Reports The Facts Ma'am. Really, why leave these problems for the next generation?

Dec. 18, 2015

shirleyberan - and a HAPPY NEW YEAR TO YOU AS WELL. Sending thoughts and wishes for health, happiness and many smiles. 2016 brings with it the reality that I will officially be a senior citizen -

Take care friend!

Dec. 19, 2015

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