Investors Sue Las Vegas Restaurant Owners Over Alleged Fund Misuse
Overview of the Legal Dispute
Investors have filed a lawsuit against the owners of Toca Madera, a steakhouse on the Las Vegas Strip, accusing them of misusing invested funds to support a lavish personal lifestyle. The lawsuit brings forward serious allegations including private securities fraud, breach of fiduciary duty, and a RICO charge.
Named defendants Mahdiar Karamooz, Tosh Berman, and Michael Tanha are claimed to have intentionally defrauded their investors through a series of deceptive financial schemes. The complaint also states that funds were misappropriated from other restaurants under their ownership, which impacted operations negatively and caused further investor losses.
Scope of the Allegations
The restaurants involved in these claims are spread across locations in Los Angeles, Arizona, and Florida. Additionally, Karamooz is accused of providing investors with altered financial reports to hide excessive spending conducted by Berman and Tanha.
Extravagant Personal Purchases
According to the lawsuit, Berman and Tanha spent investor money on numerous luxury items and properties. These include multiple engagement rings, a ranch in Aspen furnished at a cost of $100,000, and a Miami home valued at $5 million. They were also reportedly paying half the rent on a $25,000 coastal Miami property.
Luxury vehicles such as a Ferrari, a Maybach SUV, and a high-end wakeboard boat costing several hundred thousand dollars were purchased using the misappropriated funds. Plane tickets were also bought to fly OnlyFans models to restaurant grand openings or for the defendants’ travels to destinations like Europe, Australia, and Dubai.
Alleged Financial Misconduct
The lawsuit further accuses the owners of embezzling money from partnerships. One notable incident involved InDeal, a company that pays businesses to promote discounts. Berman and Tanha were supposedly paid $3 million for this deal, which they kept while using investor money to cover the discount costs.
Additionally, during rentals of Toca Madera for two Super Bowl events, the defendants are alleged to have deceived investors about the income generated and kept the excess funds for themselves.
