BUFFALO — Niagara Falls businessman and publisher Frank Parlato Jr. has been ordered to undergo an anger management evaluation and treatment, if necessary, after he was the subject of an assault complaint in Monroe County, Florida.
The complaint initially led the Monroe County Sheriff’s Office to issue a warrant for Parlato’s arrest. But that warrant was later withdrawn after prosecutors with the Office of the State Attorney, 16th Judicial District, in Key West, Fla., declined to proceed with the case and issued a memorandum of “No Action.”
Assistant State Attorney Cristina Lyn Spottswood notified a Florida court that the case would not be prosecuted because “after reviewing the evidence, conducting a sworn victim intake and considering the victim’s wishes to decline prosecution, the state does not reasonably believe this case can be prosecuted successfully.”
Parlato had faced potential charges of battery, false imprisonment and tampering with a witness.
The order for an anger management evaluation, and possible treatment, was issued by U.S. District Court Judge Richard Arcara, who is currently overseeing the federal fraud and tax obstruction case pending against Parlato and his partner Chitra Selvaraj.
Parlato is out of custody and under the supervision of U.S. Probation & Pretrial Services. Under the terms of his release, he is permitted to live in south Florida.
The assault investigation and arrest warrant from Florida first became known to federal law enforcement authorities when Arcara received what was characterized during a December court hearing as “an anonymous letter regarding the defendant.” Arcara reportedly received the anonymous letter in early November.
On Nov. 15, the judge issued a summons accusing Parlato of a violation of the conditions of his release, which, among other things, require him to report within 72 hours “any contact with any law enforcement personnel,” including questioning or an arrest. U.S probation officers told Arcara at the December violation hearing that Parlato did not report his contact with Florida law enforcement to them.
Prosecutors with the U.S. Attorney’s Office for the Western District of New York and the probation officers asked Arcara to revoke Parlato’s release and jail him. They told the judge they were prepared to present “video tapes and one to two witnesses” to support their request to put Parlato behind bars.
Parlato’s defense team argued that he should remain free because the warrant was withdrawn and he was not a risk to flee from the case.
The violation hearing came at the same time that Parlato’s lawyers and federal prosecutors had told Arcara that they were nearing a possible plea agreement in the fraud and obstruction case.
The judge ordered the anger management evaluation and allowed Parlato to remain free.
At a Jan. 26 conference, prosecutors and the attorneys for Parlato and Selvaraj told Arcara that the plea negotiations remained “ongoing” and the judge set a hearing for March 23 to “set a date for trial or pleas.”
The developments follow lengthy delays in the case prompted first by the COVID-19 pandemic and then the unavailability of most of the defense lawyers in the case. Federal prosecutors have frequently objected to the delays in the case.
Parlato and Selvaraj were charged in an 18-count superseding indictment handed up by a federal grand jury in May 2018. That indictment dropped a number of claims, made by prosecutors when the pair were originally charged in 2015.
The superseding indictment alleges a conspiracy “to defraud the United States and certain members of the public,” while adding additional claims that Parlato and Selvaraj attempted to obstruct the function of the Internal Revenue Service.Charges of wire fraud and wire fraud conspiracy, money laundering, and corrupt interference with the administration of the IRS laws remain in the superseding indictment.
Parlato, 62, the former owner of the One Niagara building, a local real estate developer, publisher of the Niagara Falls Reporter and editor-in-chief of the weekly newspaper ArtVoice, and Selvaraj, 41, who has functioned as the chief financial officer for Parlato’s business enterprises, have each previously pleaded not guilty to the charges contained in the indictment.
The original indictment followed a four-year investigation into Parlato’s business dealings. The investigation first became known in 2011, when federal agents served subpoenas looking for records at the One Niagara building.
Parlato and Selvaraj are accused of orchestrating a scheme to defraud the IRS through the use of an array of limited liability corporations and partnerships. The indictments catalog the use of more than 15 so-called shell companies, 50 bank accounts and multiple attorney trust accounts in perpetrating the scheme.
Prosecutors have charged the scheme involved the movement of large sums of cash through multiple accounts.