Chris Harrison at the 2015 redevelopment announcement for the Ramada Inn project in Petersburg. (BizSense file images)
The developer behind the Model Tobacco Lofts in South Richmond and an aborted redevelopment of a hotel in Petersburg is facing federal embezzlement charges involving both projects and another in North Carolina.
Chris Harrison, principal of Maryland-based C.A. Harrison Cos., was indicted by a federal grand jury this week on charges that he skimmed loan proceeds for the Model Tobacco project and another in Winston-Salem and put some of the funds toward unauthorized expenses, including litigation costs related to his failed redevelopment of the since-razed Ramada Inn hotel in Petersburg.
The nine-story Ramada Inn building as seen along Interstate 95 in 2015.
Harrison, a former UVA and NFL football player who has been active in commercial real estate for two decades, is alleged to have submitted more than a dozen falsified invoices and lien waivers in draw requests to Cedar Rapids Bank & Trust (CRBT) to secure over $3.6 million in loan proceeds that he put toward personal expenses and the Petersburg litigation.
According to a release from the Eastern District of Virginia U.S. Attorney’s Office, Harrison spent the funds at luxury goods and fashion stores, including over $60,000 on Rolex watches; personal expenses including his home mortgage, landscaping expenses for his residence and tuition and tutoring expenses for his child; and legal fees to a law firm for his litigation against the City of Petersburg.
Harrison, 52, is charged with wire fraud and mail fraud, engaging in monetary transactions with criminally derived property, and aggravated identity theft. The charges carry a combined maximum prison sentence of 32 years, though actual sentences for federal crimes are typically less than the maximum penalties.
The grand jury handed down the indictment Tuesday. It was announced via the release Thursday afternoon.
A call to a mobile phone for Harrison was not returned Thursday afternoon.
The Model Tobacco building along Route 1 in South Richmond.
According to the release, Harrison secured over $22 million in loans from CRBT for the Model Tobacco project in South Richmond and the Winston-Salem project, called Whitaker Park. The loan agreements prohibited him from using proceeds to pay himself or affiliated entities or from using the proceeds for personal expenses.
Harrison is alleged to have created a straw company called Virginia Demolition LLC that he said performed work on the projects – including work that predated the creation of the LLC – but, according to the indictment, had no employees, equipment or office.
He also is alleged to have doctored and inflated invoices in the name of a construction vendor for Model Tobacco, inducing CRBT to disburse inflated loan amounts.
Harrison at a ceremony in 2022 when the building’s signage was illuminated for the first time in decades. (Facebook video screenshot)
Harrison completed the first phase of Model Tobacco, a mixed-use project converting the Art Deco-style building and 15-acre complex along Richmond Highway into 275 income-based apartments. The first phase involved 203 apartments and included plans for an entertainment venue. Harrison had told BizSense in 2020 that the phase was estimated to cost about $59 million.
Two of his investors on the project sued Harrison in 2022, accusing him of committing fraud and money laundering to wrest control of the project. The lawsuit was dismissed last year after a confidential settlement was reached. Subsequent court filings related to that dispute showed the settlement involved a $6 million money judgment.
Harrison’s attorney in that case, George Doumar of Arlington-based Doumar Martin, could not be reached Thursday. It’s unclear whether Doumar is representing Harrison in the federal case.
The Model Tobacco settlement followed another settlement reached in 2022 between Harrison and the City of Petersburg. That agreement, which resolved litigation from Petersburg, saw Harrison sell back to the city the former Ramada Inn property that was once planned for a $20 million rehab.
Petersburg paid Harrison $1.25 million for the blighted property – $500,000 more than he paid for it four years earlier. The city has since razed the nine-story building, which was highly visible along Interstate 95, and is seeking to have the 2-acre site on Washington Street redeveloped.
Thursday’s indictment announcement was made by Eastern District of Virginia U.S. Attorney Jessica Aber in conjunction with the FBI’s Richmond Field Office and the IRS’s field office in D.C. Assistant U.S. Attorneys Kashan Pathan and Avi Panth are prosecuting the case.
A court date for Harrison was not included in the announcement. Documents related to the indictment are under seal.
Chris Harrison at the 2015 redevelopment announcement for the Ramada Inn project in Petersburg. (BizSense file images)
The developer behind the Model Tobacco Lofts in South Richmond and an aborted redevelopment of a hotel in Petersburg is facing federal embezzlement charges involving both projects and another in North Carolina.
Chris Harrison, principal of Maryland-based C.A. Harrison Cos., was indicted by a federal grand jury this week on charges that he skimmed loan proceeds for the Model Tobacco project and another in Winston-Salem and put some of the funds toward unauthorized expenses, including litigation costs related to his failed redevelopment of the since-razed Ramada Inn hotel in Petersburg.
The nine-story Ramada Inn building as seen along Interstate 95 in 2015.
Harrison, a former UVA and NFL football player who has been active in commercial real estate for two decades, is alleged to have submitted more than a dozen falsified invoices and lien waivers in draw requests to Cedar Rapids Bank & Trust (CRBT) to secure over $3.6 million in loan proceeds that he put toward personal expenses and the Petersburg litigation.
According to a release from the Eastern District of Virginia U.S. Attorney’s Office, Harrison spent the funds at luxury goods and fashion stores, including over $60,000 on Rolex watches; personal expenses including his home mortgage, landscaping expenses for his residence and tuition and tutoring expenses for his child; and legal fees to a law firm for his litigation against the City of Petersburg.
Harrison, 52, is charged with wire fraud and mail fraud, engaging in monetary transactions with criminally derived property, and aggravated identity theft. The charges carry a combined maximum prison sentence of 32 years, though actual sentences for federal crimes are typically less than the maximum penalties.
The grand jury handed down the indictment Tuesday. It was announced via the release Thursday afternoon.
A call to a mobile phone for Harrison was not returned Thursday afternoon.
The Model Tobacco building along Route 1 in South Richmond.
According to the release, Harrison secured over $22 million in loans from CRBT for the Model Tobacco project in South Richmond and the Winston-Salem project, called Whitaker Park. The loan agreements prohibited him from using proceeds to pay himself or affiliated entities or from using the proceeds for personal expenses.
Harrison is alleged to have created a straw company called Virginia Demolition LLC that he said performed work on the projects – including work that predated the creation of the LLC – but, according to the indictment, had no employees, equipment or office.
He also is alleged to have doctored and inflated invoices in the name of a construction vendor for Model Tobacco, inducing CRBT to disburse inflated loan amounts.
Harrison at a ceremony in 2022 when the building’s signage was illuminated for the first time in decades. (Facebook video screenshot)
Harrison completed the first phase of Model Tobacco, a mixed-use project converting the Art Deco-style building and 15-acre complex along Richmond Highway into 275 income-based apartments. The first phase involved 203 apartments and included plans for an entertainment venue. Harrison had told BizSense in 2020 that the phase was estimated to cost about $59 million.
Two of his investors on the project sued Harrison in 2022, accusing him of committing fraud and money laundering to wrest control of the project. The lawsuit was dismissed last year after a confidential settlement was reached. Subsequent court filings related to that dispute showed the settlement involved a $6 million money judgment.
Harrison’s attorney in that case, George Doumar of Arlington-based Doumar Martin, could not be reached Thursday. It’s unclear whether Doumar is representing Harrison in the federal case.
The Model Tobacco settlement followed another settlement reached in 2022 between Harrison and the City of Petersburg. That agreement, which resolved litigation from Petersburg, saw Harrison sell back to the city the former Ramada Inn property that was once planned for a $20 million rehab.
Petersburg paid Harrison $1.25 million for the blighted property – $500,000 more than he paid for it four years earlier. The city has since razed the nine-story building, which was highly visible along Interstate 95, and is seeking to have the 2-acre site on Washington Street redeveloped.
Thursday’s indictment announcement was made by Eastern District of Virginia U.S. Attorney Jessica Aber in conjunction with the FBI’s Richmond Field Office and the IRS’s field office in D.C. Assistant U.S. Attorneys Kashan Pathan and Avi Panth are prosecuting the case.
A court date for Harrison was not included in the announcement. Documents related to the indictment are under seal.
Well this explains why those projects never moved forward