April 22, 2003 – Advisers to the Public Finance Authority board on Tuesday presented a laundry list of information gathered in a background investigation of would-be St. Croix resort investor Paul Golden, including a lawsuit his mother filed in October claiming he owes her more than $1.3 million.
Other items in PFA bond counsel Roger Quinland's report cast no more positive light on Golden — who wants to build a resort and casino on St. Croix's South Shore. They include a felony burglary conviction and other charges; a lack of prior experience in casino and resort development, and questions about the status of Golden's other companies.
The lawsuit, filed in New Jersey by Linda Golden, alleges that Paul Golden borrowed money from his mother over the course of owning three businesses from 1984 through 2001, promising to repay her as soon as the firms' profits allowed him to do so.
The complaint says Linda Golden funded the loans with her and her husband's money and that she also borrowed money from her mother, Paul Golden's grandmother, Miriam Pollack, to give to him. On July 16, 1984, the suit says, Paul Golden signed a promissory note for $550,000 payable to Pollack and never repaid it. The total of the loans, the lawsuit alleges, is more than $1.3 million.
Over several years, Paul Golden earned more than $2.3 million in proceeds from litigation involving one of his companies, but he nonetheless failed to pay his mother back, the suit says.
He used money she gave him, it says, to obtain a V.I. casino license and property on St. Croix. "Because the funds Paul Golden used for the acquisition of the casino license and the Estate Hartmann's property belong to Linda Golden," it states, "Paul Golden's interest in the assets acquired with those funds, including the Estate Hartmann's property and the casino license, belong to Linda Golden."
At Tuesday's PFA board meeting, attorney Treston Moore, who represents Paul Golden, called the dispute with Linda Golden "painful." Appearing on Paul Golden's behalf at the meeting, Moore said the situation precipitated a rift in the entire family, and "you have things that were given to the son that are no longer gifts but now debts."
Moore said the issue is pending and Linda Golden is "not likely to succeed" in her efforts to obtain Paul Golden's St. Croix assets.
Outlining other information found in a background check of the developer, Quinland said that in 1984 Paul Golden was convicted of felony burglary charges. However, Moore was dismissive of the incident, pointing out that it occurred when Golden was 19 years old and involved nothing more than baseball cards.
Quinland also cited charges since filed against Golden but added that no convictions have resulted. At one point, he said, there was a national arrest warrant out for Golden alleging that he had defrauded a Las Vegas casino.
In July 2000, a New Jersey newspaper reported Golden's arrested as a fugitive in that state for cashing a $30,000 check at Caesars Palace in Las Vegas and then stopping payment on it. However, Moore told the board Tuesday that the warrant had been based on a misunderstanding and that Golden had canceled the check after wiring the casino the money he owed.
The newspaper report also said Golden owned a strip club, Virgo's Gentlemen's Club, in North Brunswick, New Jersey, that was shut down after the city passed an ordinance prohibiting all-nude dancing.
Moore said Golden bought the club because the property was in foreclosure and he realized a considerable return on the investment after owning it for only a few months.
"It is extremely disturbing, by the comments we've heard here, calling into question [Golden's] character this late in the game," Moore said. He pointed out that the Casino Control Commission had done an extensive background check before issuing a statement of compliance with a reservation of a casino license to Paul Golden.
In a letter to the PFA, Eileen Petersen, commission chair, pointed out that the agency continues to investigate the "background activities and financial history of Paul Golden subsequent to the issuance of the statement of compliance."
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