Former owners admit concealing $230,000 skimmed from Block club


The former owners of the Harem nightclub pleaded guilty yesterday to failing to report $230,000 they skimmed from their strip joint on The Block, Maryland Attorney General J. Joseph Curran Jr. announced.

The guilty pleas in Anne Arundel Circuit Court of Paul Battaglia, 48, and Mahala Anderton Battaglia, 27, mark the first tax convictions stemming from the problem-ridden January 1994 raid by the state police on Baltimore's infamous red light district.

The Battaglias could face up to 10 years in jail for filing a false tax return when they are sentenced Oct. 28 by Judge Pamela North, but prosecutors are recommending a three-year sentence with all but six months suspended.

The Battaglias also must pay $23,542.66 in back taxes, penalties and interest for the years 1992 and 1993, Assistant Attorney General Carolyn H. Henneman said.

Paul and Mahala Battaglia and their bar on Custom House Avenue were at the center of several problems that marred the four-month investigation of drug use and prostitution on The Block and the massive raid by 500 state troopers of 23 nightclubs.

A key member of a state police undercover team resigned after admitting that he spent the night in a motel room with Mahala Battaglia during the investigation that led to the raid. Two other troopers were accused of 15 counts of misconduct stemming from an alleged liaison with a dancer in the Harem, but were cleared by a police trial board when the dancer failed to appear at a hearing.

More than half of 87 drug arrests made during the raid were dismissed because of weak evidence, police misconduct or both, and the supervisor of the operation later resigned.

In a statement to the court yesterday, Henneman said that the Battaglias hid the money they failed to report in a bank account under Mahala Battaglia's maiden name. The couple spent the money on "personal expenses and various luxuries, including expensive additions to their Baltimore County home," Henneman said.

The Battaglias have sold the Harem and live in South Carolina.

Efforts to reach their attorney, Arthur M. Frank, were unsuccessful.

Pub Date: 8/31/96

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