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Roof caves in on Mongelluzzis' house of cards

CLEARWATER — In the final months before Able Body Labor was sold last year, thousands of furious day laborers stormed the company's national headquarters here.

Former receptionist Susan Rekers remembers manning the "front lines," with workers screaming that their paychecks had bounced. One woman drove from Jacksonville, livid; one man complained he was owed $24,000. Security guards were hired to keep order.

"It was a nightmare," Rekers said. "We didn't know what was going to happen every time someone was walking up the sidewalk."

Employees behind the desk were no less upset. Many accused company owners Frank and Anne Mongelluzzi of not only giving them bad checks, but of also pocketing payroll deductions employees designated for their retirement accounts. Some say they learned when they visited their doctors that their medical insurance premiums had not been properly applied.

While the complaints of employees and day laborers grew, the multimillion-dollar empire of the Mongelluzzis expanded. The Dunedin couple owned jets, boats, antique cars and six homes in Clearwater and Dunedin valued at $3.3 million.

It was a lifestyle in staggering contrast to that of the 80,000 day laborers and permanent workers at one time employed by the couple's sprawling interests. Their work for the Mongelluzzis, some say, led to disaster.

"They destroyed me financially," said Matt Cannon, a five-year district manager for Able Body, who said he was shorted tens of thousands of dollars in wages and expenses.

"This is something that will take years to recover from."

• • •

This year the couple's holdings began to collapse, leaving them with $60 million in debts and owing millions more in unpaid taxes, court records show. Able Body offices in 26 states were sold. Frank Mongelluzzi filed for Chapter 7 bankruptcy — his fourth bankruptcy filing in Florida.

The 140 bankers boxes of records seized so far by U.S. Marshals shed more light on the Mongelluzzis' maze of businesses — a network some have likened to a house of cards.

Investigators are still uncovering information. On Wednesday, while taking documents from the Mongelluzzis' $700,000 home on Lynnwood Court in Dunedin, federally appointed bankruptcy trustee Angela Esposito saw something suspicious on their home computer screen.

Anne Mongelluzzi, Esposito's attorneys later wrote, had sent e-mails discussing ways to thwart the trustee's review of the couple's assets. When the couple wouldn't hand over their passwords, attorneys filed for an emergency order to save all e-mails.

Steve Berman, an attorney for Shumaker, Loop & Kendrick in Tampa, said that's not all the Mongelluzzis tried to hide. He said in the last few weeks, the trustee has found aircraft, luxury cars, land, collectibles and Rolex and Cartier watches not listed by the Mongelluzzis as assets.

"If you're going to get the benefit of a bankruptcy, you have to be fully forthcoming," Berman said. "That wasn't the case here."

Sorting through the Mongelluzzis' holdings has proven unusually daunting, Berman said. A bankruptcy petition estimates they had up to 200 creditors. Berman said they owned more than 100 properties. MDT Personnel, which bought Able Body last September, accused the Mongelluzzis of getting associates to ransack offices and shred reams of documents.

Adding to the confusion are the couple's 120 separate businesses, with names like Captain Terrific and Westward Ho. Some — two Pssghetti's Italian restaurants in Clearwater and North Carolina, three pawn shops, an auto repair garage, a farm in North Carolina and a marina in Tennessee — are easy to find, Berman said. Others appear to be phantoms — just names and business filings.

At least two companies, FM Aviation and Mr. Excitement, were founded by Frank Mongelluzzi exclusively to buy business-class jets, including a Raytheon Hawker 800, court records show. Lenders to those companies sued, claiming he failed to make millions in loan payments.

The Internal Revenue Service and the Florida Department of Revenue have placed tax liens amounting to at least $2.5 million on the Mongelluzzis and their companies. Some of those date back to 2006. In December 2010 and January 2011 alone, a handful of businesses, including Pssghetti's, were cited for $1 million in unpaid taxes.

Berman said the Department of Revenue is investigating the Mongelluzzis, but that department and the IRS told the St. Petersburg Times any investigation would be confidential.

Mongelluzzi will be questioned "fairly heavily" under oath in Tampa early next month during a bankruptcy proceeding, Berman said.

• • •

This week, as employees of the couple's businesses wondered how to get by without paychecks, Mongelluzzi said he was remorseful over the effects of the bankruptcy. A drop in demand for construction, he said, led to Able Body's demise.

"We're just trying to make a living and trying to preserve a few things that are important," he said. "It's very hard to watch someone who needs a check that day not get it."

But Joyce Guerin, an assistant at Able Body for seven years, said the couple knew for months that employees' paychecks were worthless.

"When my payroll check bounced … I went into orbit," Guerin said. "If I bounce a check at Publix, I'm going to jail."

Guerin said it went even further than that: Money deducted from paychecks for retirement plans, child support payments or medical insurance was kept within the company.

Lee Elliott, a former operations coordinator and 14-year employee of Able Body, said that money was misspent on business ventures, property, "almost anything else they could think of."

"It wasn't the failure of the construction industry. It was that Frank and Anne were so arrogantly greedy," Elliott said. "They drove the company to ruin."

Contact Drew Harwell at dharwell@sptimes.com.

Roof caves in on Mongelluzzis' house of cards 04/15/11 [Last modified: Saturday, April 16, 2011 12:12am]

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