UPDATE SEPTEMBER 13TH, 7PM: Billy Crystal will ignore the scandals at the Friars Club, and accept the Icon Award in November. Let’s hope Federal Agents aren’t in the audience.
EXCLUSIVE Billy Crystal is such a good guy. I’m told he’s almost agreed to host some kind of awards show for the Friars Club this fall.
But good guy Billy lives in Los Angeles, and doesn’t know what’s going on at 57 East 55th St. No one’s told him about the raid by federal postal inspectors on the Friars headquarters on Valentine’s Day 2017. He also doesn’t know about the settled sexual harassment suit brought by a former receptionist.
What Billy really doesn’t know is that the Friars Club is drowning in red ink. I have their 2017 financial report issued by Reardon Accountants on May 24, 2018. The first warning sign in the report should send up red flags at the IRS: “We did not audit or review the financial statements nor were we required to perform any procedures to verify the accuracy or completeness of the information provided by management…
“…Management has elected to omit substantially all of the disclosures required by accounting principles generally accepted in the United States of America. If the omitted disclosures were included in the financial statements, they might influence the user’s conclusions about the Company’s financial position, results of operations, and cash flows.”
The settlement with Rehanna Almestica, the receptionist who sued for sexual harassment, must have been huge. Almestica claimed that Friars’ celebrity wranger Bruce Charet regularly made sexually explicit phone calls to her and that the Friars Club fired her after she complained.
So it’s not surprised that under Expenses in the Reardon report, the Friars listed $3.8 million for Employee Compensation and Benefits. This number was considerably higher than both their revenue from the restaurants in their club house ($2.3 million) and dues from paying members ($3.2 million). The Friars claimed a net loss “before termination expense and legal and professional fees– extraordinary” — for 2017 of $559,832.
When this report was prepared in May, there was no mention of a pending lawsuit from former employees for over $300,000, recently reported in the New York Post.
The Friars National Association, a 501 (c) 3 charity, has not filed a form 990 tax return, by the way, since 2015.
As for contingencies, the report includes a note from the Club at least conceding they are being scrutinized by the Feds: “In connection with the investigation by the US Attorney’s Office for the Southern District of New York which commenced in 2017, legal counsel as informed management that the Friars National Association Inc nor any of its officers, directors, or employees have been accused of criminal conduct. The Club has cooperated constructively with the authorities. Legal counsel has not seen proof of criminality in its investigation and believes criminal charges are not a likely result.”
The group concedes in the report that they’re also under a New York State tax audit for the period of March 1, 2013 to August 31, 2015– during which they staged their hugely unsuccessful Lincoln Awards (which incurred $1.6 million in unspecified expenses and was put together by group exec Bruce Charet, the subject of Almestica’s lawsuit.
There’s no response yet from Billy Crystal, but I’m sure he’ll be happy to see all this in black and white before he agrees to pitch in– no matter how good a guy he is.