Future ownership of the Crowne Plaza Orlando Universal Hotel is in limbo as its majority owner serves time in a Brazilian federal prison for charges related to money laundering, tax evasion and homicide, and his stake in the hotel is held for potential auction, Brazilian government officials have confirmed to GrowthSpotter.
A federal judge in Brazil ruled in October 2014 that João Arcanjo Ribeiro, described by prosecutors in public documents as a former head of organized crime in Mato Grosso state, would have assets that were obtained as proceeds of crime liquidated by Brazil's government. Other assets that weren't gained from criminal activity will be sold to recover millions of dollars in unpaid taxes.
Arcanjo accumulated a long list of Brazilian and international assets estimated at more than BRL 900 million ($285 million) in value, which are now being held by Brazilian federal agencies for potential auction, according to reports in Diário Oficial da União, an official journal of Brazil's government, and Brazil's Federal Public Ministry.
One of the main assets is a 65 percent ownership stake in Orlando-based Universal Towers Construction (UTC), a super-majority share that belongs to Arcanjo's Brazilian company, Universal Towers Investimentos e Participações Ltda. (UTI).
UTC was incorporated in 1998 in Florida with Arcanjo listed as president and CEO. UTC is the company that, in 2002, built the 400-room Crowne Plaza Orlando Universal Hotel at 7800 Universal Blvd., owns the property and shares the hotel's address.
Thus, Brazil's government controls the hotel's fate by controlling the assets of Arcanjo's Brazilian business, UTI. A Brazilian court has appointed judicial administrator Francisco Ferreira Bomfim to manage assets of Arcanjo and UTI until they can be liquidated.
Reached by phone in May at his office in Cuiabá, Mato Grosso, Bomfim told GrowthSpotter that he couldn't forecast when the auction process would start for UTI's majority stake in the Crowne Plaza.
The liquidation and repatriation of assets would respect the laws of the United States and existing international agreements, Brazil's Attorney General office told GrowthSpotter.
Arcanjo's attorneys continue to appeal court rulings in Brazil regarding the control of his assets. In mid-December, a judge from another federal court suspended the October 2014 decision to liquidate Arcanjo's assets.
Those assets can't be sold until ongoing legal proceedings conclude. But they won't be returned to Arcanjo because they've been blocked since 2002 when he was first convicted, a decision that remains valid, according to Brazil's Attorney General.
Orlando-based attorney Tee Persad, serving as general counsel to UTC, said Brazil's Bomfim has done "a phenomenal job" administrating the Crowne Plaza's ownership in recent years, which continues to operate as normal. Bomfim has "put UTC in a better position than how he found it," Persad said.
Brazil's Central Bank said Arcanjo didn't declare how he moved money to the U.S. to pay off loans of more than $14.6 million for the Orlando hotel, which investigators linked to money laundered through an international crime syndicate.
A former civil policeman in Mato Grosso, Arcanjo became known as an organized crime leader in his state and was given the infamous nickname "Commander" by City Council members in Cuiabá, according to Brazilian news reports.
Arcanjo was sentenced to 37 years in prison by a Brazilian court in 2003 while he was imprisoned in Uruguay, where he was being held while awaiting extradition to Brazil. He was extradited to Brazil in 2006, where a federal judge in Brasilia reduced that sentence to 11 years and four months.
Arcanjo was sentenced to another 19 years in 2013 on a separate conviction for ordering the murder of a prominent journalist in Cuiabá. He is now in a maximum security federal prison in Porto Velho, Rondonia state.
Among assets to be auctioned off is Arcanjo's Orlando home, located at 4760 High Oak Court, which he bought in 1999 for $200,000, according to Orange County records.
The Brazilian government will also attempt to recover a money market account in Arcanjo's name at Wachovia Wells/Fargo bank valued at $159,789, and a private Cessna jet valued at BRL 7.3 million ($2.3 million), among other assets, according to Brazil's Federal Public Ministry.