An influential lobbyist for Charlotte’s hospitality and tourism industry made an introduction that would change the city’s history.
Mohammad Jenatian, president of the Greater Charlotte Hospitality & Tourism Alliance, brought together former Mayor Patrick Cannon and an undercover agent posing as a Chicago businessman about three years ago.
According to a federal affidavit that charges Cannon with taking bribes, Cannon would come to trust the FBI agent enough to meet with him in the mayor’s office and accept a briefcase with $20,000 in cash. Cannon also flew to Las Vegas to help the agent convince skeptical foreign businessmen – actually other FBI agents – to invest millions in Charlotte with the promise that he could fix zoning and permitting issues, the affidavit recounts.
Making introductions is what Jenatian has done in Charlotte for 20 years.
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It wouldn’t be unusual – in fact, it might be essential – for an investor to ride into town and seek Jenatian’s guidance and access to his vast network.
His role as a connector is his power in Charlotte. But this is not the first time his connections have drawn him into a public storm.
In 2006, Jenatian was summoned before a federal grand jury investigating illegal campaign contributions to then-House Speaker Jim Black, who later pleaded guilty to public corruption and went to prison. The feds wanted to know about $4,000 that Jenatian funneled to Black from a strip club owner.
More recently, some taxi company owners accused Jenatian of pressuring them to pay higher fees to the hospitality and tourism alliance in order to do business at the airport. Jenatian has denied the allegations.
For all of his influence, Jenatian is mostly a one-person operation. He works independently, with little oversight from his nonprofit board. His compensation in recent years ranged from 32 to 67 percent of the alliance’s revenue.
By all accounts, he’s an excellent salesman and a master of connections.
“What he promises, he delivers,” said Ravi Patel, chairman of SREE Hotels, who serves on Jenatian’s board.
Jenatian (pronounced jin-a-TEE-un) did not return calls to his cellphone or his office for this story.
In interviews over the years, he said he immigrated from Iran at age 17. He said he was the first in his family to go to college, beginning at Sacred Heart College in Belmont, where he learned to speak English. He worked his way up in the hotel business to become vice president of SREE Hotels.
The hotel and tourism alliance was formed in 1994 to give small hotels, restaurants and entertainment businesses a voice in the city’s decision-making. Under Jenatian’s leadership, it became a force in city politics. It has more than 800 members, ranging from the general manager of the Ballantyne Hotel & Lodge to the owner of the Leather & Lace strip club.
According to its website, other members include a taxi company, beer distributor, a car rental agency, the Carolina Panthers, the Charlotte Bobcats and Charlotte Motor Speedway.
Jenatian has been an enthusiastic supporter of the city’s most high-profile projects, including the uptown arena, the new baseball park and the NASCAR Hall of Fame.
“A relationship broker,” said Ben Knight, who serves on the alliance’s board and owns several FASTSIGNS locations. “He’s really active trying to help promote the city of Charlotte as a destination for people to come to. That’s what he’s excellent at doing, trying to pull people together.”
Testing the waters
When Jenatian introduced Cannon to the undercover agent in 2010, the affidavit says the agent was investigating other people. The affidavit doesn’t say what the feds were after, but says the agent interacted with “certain business figures in Charlotte.”
If an undercover agent were looking into alleged bank fraud, he might pose as a banker. If he were concerned about voter fraud, he might pretend to be a wealthy donor.
In the investigation that led to Cannon’s arrest, the agent claimed to be a business manager for a venture capital company based in Chicago, according to the affidavit. The agent told people he wanted to “test the waters” in Charlotte by opening a nightclub or bar. The affidavit says that Cannon and a “local businessman” recommended to the undercover agent several possible sites.
The FBI’s choice of a nightclub suggests it might have been investigating some aspect of the entertainment business. But in 2012, the affidavit says, the investigation shifted to Cannon after agents learned he was potentially involved in illegal activity.
A role in politics
Of the 31 members of the alliance’s board, Cannon was the only politician.
He championed the hospitality and tourism industry and saw it as beneficial to his company: EZ Parking, which operates about 20 lots uptown. Among tourism projects, Cannon worked to get new rules governing cab drivers after complaints that taxis were dirty and drivers couldn’t find their way around.
Fellow tourism board members supported Cannon. Since 2011, members of the current board donated $5,000 to his political campaigns.
The alliance also supported Cannon and other politicians through its political action committee. Since the Tourism Political Action Committee formed in 1994, Cannon received $5,400. Only three other politicians received more: Gov. Pat McCrory, the former mayor of Charlotte, got $16,225; Black, the former House speaker, $14,250; and Lynn Wheeler, a former City Council member, $7,900.
The PAC is still licensed, but has not made a donation since 2010.
Members of the alliance’s board of directors were among the most generous contributors to the PAC. David “Slim” Baucom and his family gave the PAC $16,000 from 2001 to 2006. Baucom controls one of the largest strip club enterprises in the Southeast. His company, MAL Entertainment, owns adult nightclubs from Raleigh to Ohio, including establishments in the Charlotte area such as the Gentleman’s Club, the Gold Club and multiple Leather & Lace locations.
In 2006, Baucom gave the PAC $4,000. Jenatian passed it on to Black. Neither contribution showed up on the PAC’s campaign finance reports. As a result, Jenatian and Baucom were summoned to appear before a federal grand jury investigating Black.
Jenatian said at the time that he neglected to record the information. He filed an amended report.
“It’s so discouraging,” Jenatian told the Observer in 2007. “What the hell did I do wrong?”
Baucom said Friday that he stopped donating. “Ever since the Jim Black thing, I haven’t given them a penny. ... It wasn’t that I had done anything wrong. It was just being brought up because of the nature of (my) business.”
Asked whether he had ever met the undercover agent investigating Cannon, Baucom said: “I don’t have a clue who he is.” And he said that the FBI had not interviewed him.
Baucom said he didn’t know Cannon well and hasn’t asked him for help with permitting. “I see him at the board meetings and stuff like that,” he said. “Hellos and shake hands here and there.”
Setting his salary
Jenatian’s name came up with Cannon’s three years ago when the city decided to reduce the number of taxi companies operating at the airport.
At a council meeting in 2011, an attorney for one cab company accused the hotel and tourism alliance of turning the selection process into a “pay-to-play” scheme. Cabbies also complained that Cannon shouldn’t be allowed to vote on the issue because he had benefited from the alliance’s largess.
Last week, a cab owner told the Observer that Jenatian said he would have to join the alliance for $5,000 if he wanted to stay at the airport. Jenatian told the Observer the account was untrue. His board members said that Jenatian was reminding taxi owners that if they wanted his support, they needed to join his organization. His membership fees range from an entry-level $295 to a top level of $5,000.
The fees make up part of the alliance’s revenue. Other sources are corporate sponsorships and fundraisers.
The alliance also benefits from the Charlotte Regional Visitors Authority, which is run by a city-appointed board. This year, the CRVA agreed to give the alliance $20,000 and complimentary meeting space for its annual gala, among other things.
The alliance is registered as a nonprofit and tax-exempt organization with the North Carolina secretary of state. The IRS considers it a business organization, such as a chamber of commerce.
In 2012, the most recent year available, the alliance took in $639,275. Tax forms show Jenatian received $256,848 in compensation – 40 percent of the revenue.
Eight board members told the Observer they did not know Jenatian’s salary. They meet every other month but, unlike most boards, they don’t measure his performance or conduct any benchmark pay comparisons. Board members did not know who set Jenatian’s salary.
“You’d have to ask Mohammad that one,” said Carl Peterson, who represents Piedmont Natural Gas on the alliance board.
“I have no idea,” said Shiela Fletcher of Full House Productions, a board member who also is chair of the alliance’s officers. “You might want to call Mohammad Jenatian.”
“I don’t know,” said board member H.A. Thompson, founder of Rose Chauffeured Transportation. Told that Jenatian got $237,465 in compensation in 2010 – more than 58 percent of the organization’s total revenue, according to IRS reports –Thompson exclaimed, “I’m stunned.”
“That doesn’t sound too out of line to me,” said Brad Johnston, owner of Tryon Distributing, a beer and wine wholesaler. “I think he does a fabulous job.”
Mingling in the crowd
For 20 years, Jenatian has thrown a huge black-tie gala promoting the Greater Charlotte Hospitality and Tourism Alliance.
The dinner at the Charlotte Convention Center on Feb. 21, 2013, drew hundreds of people, many of whom make their living in hotels, restaurants, strip clubs and bars. They sipped on cocktails and enjoyed a three-course dinner.
Mingling in the crowd was a man who had expressed an interest in opening a nightclub:
The undercover FBI agent.
Reporters Ames Alexander, Maria David, Steve Harrison, Gavin Off, Ely Portillo and Rick Rothacker contributed.