Millionaire Jalousie Hotel Developer Accused of Food Stamps Fraud!

Earlier this week an article appeared online that centered on a police raid on an Ohio millionaire’s home for evidence that he allegedly collected food stamps while he had millions in the bank. Said the online source, the police raided the expansive estate of Ali Pascal Mahvi “to investigate potential theft, Medicaid and Welfare fraud.” Geauga County prosecutor James R. Flaiz was quoted as saying: “It’s outrageous to see a situation where somebody is living in a house worth almost a million dollars, with a horse barn, drives luxury cars, has millions of dollars in overseas bank accounts and here they are accepting this type of assistance.”

The story claimed authorities had connected him to a $4.2 million Swiss bank account that Mahvi insisted belonged to his father Abolfath Mirza Mahvi. With roots in Iranian royalty, he had founded several major international businesses. While as of last weekend neither the Ohio Mahvi nor family members had been charged with any crime, investigators revealed they had this year deposited at least $30,000 in six separate transactions, each under $10,000 at a time.

Meanwhile, they had declared zero income on their Medicaid applications and received $300 a month for the past two years in food stamps. They also said they’d had to borrow $25,000 from friends. In his own defense Ali Pascal Mahvi insisted he is not a wealthy man and is eligible for Welfare aid despite the value of his home and possessions. He is quoted as saying: “It was our right to apply for food stamps, so I applied. If you don’t like the food stamp system, change it.” Mahvi was credited as the author of Deadly Secrets of Iranian Princes: Audacity to Act, a memoir about his life as the descendant of Iranian royalty.

(Left)Prime Minister John Compton in his element at the 1992 opening of Jalousie Hotel (“a night for lovers” is how he described the occasion). At left, Colin Tennant. (Right)Jalousie owner Prince Pascal Mahvi (center) flanked by commerce minister George Mallet (left) and tourism minister Romanus Lansiquot.

(Left)Prime Minister John Compton in his element at the 1992 opening of Jalousie Hotel (“a night for lovers” is how he described the occasion). To far left, Colin Tennant. (Right) Jalousie owner Prince Pascal Mahvi (center) flanked by commerce minister George Mallet (left) and tourism minister Romanus Lansiquot.

As I perused the seemingly farfetched item, something about the name of its central figure challenged my sense of recall. Pascal Mahvi sounded familiar. But I was thrown off by the Ohio millionaire’s given name: Ali. The picture that accompanied the piece wasn’t much help. I was about to dismiss the whole thing as coincidence, even online fiction, when my eye caught the following in the final paragraph: “Mahvi boasted that he is the son of an Iranian prince with huge properties in the Middle East, Southern California and Saint Lucia.”

Yes, Saint Lucia! Now I knew for certain there was something to the story—especially if it turned out that the ostensible millionaire who had been accused of food stamps fraud, as wild as it sounded, was the individual I knew as Pascal Mahvi back in the early 90s. I had written reams about his adventures with the governments of John Compton, Vaughan Lewis and Kenny Anthony—not to mention local unions.

In 1991 Pascal Mahvi had purchased from the famously eccentric Lord Glenconner Colin Tennant the property between Soufriere’s Sulphur Springs and the Pitons (now a Heritage Site) on which the Iranian and his mysterious M Group would set up Jalousie Hotel, later to be renamed Sugar Beach. By reliable account Mahvi’s father had in the last days of Reza Pahlevi, the Shah of Iran, managed to shift over a billion pounds to United States accounts. Following a short vacation in Saint Lucia, he had forked out US$500,000 for 320 out of the 480 acres that was Jalousie Estate. In 1982, when his son controversially passed away, Tennant had bought it from its American owner, an elderly woman, for US$1.8 million. As he told me when I interviewed him for the purposes of my book Lapses & Infelicities several months before his death on 27 August 2010, “the place was then an absolute jungle, with only a footpath here and there.”

News that the previously ignored but environmentally sensitive property was about to be turned by despised Iranians into a concrete jungle generated widespread controversy. Local journalists were barred from the construction site. But a white American freelancer, posing as a tourist, had little difficulty getting past the barbed wire fencing. He later submitted to this newspaper what he had uncovered, after talking with the project’s Iranian coordinator Kurush Aranya, one of a half dozen or so of “Prince” Mahvi’s cohorts who had established themselves in Soufriere.

Among Randall’s revelations: “I was somewhat taken aback when Aranya nonchalantly admitted the owners of the property, the M Group, a subsidiary of a Geneva-based finance company, had no interest whatsoever in the locals. All they cared about were the rich tourists they hoped to attract in droves once their hotel was up and running. Their intention was to leave their well-heeled patrons no reason to venture outside the periphery.”

The predictable fallout from Randall’s report was swift. The opposition St. Lucia Labour Party, environment-conscious natives including Derek Walcott and the renowned artist Llewellyn Xavier, banded together in united protest against what they considered the “desecration of ground considered sacred by our ancestors.” Even Jean-Michel Cousteau, son of world famous conservationist and explorer Jacques Cousteau, expressed grave concern in a Miami Herald feature entitled“ Development in Saint Lucia Affects Us All,” also reproduced in this newspaper. In his article Jean-Michel Cousteau recalled that in 1985 the government of Saint Lucia had requested of the Organization of American States technical advice on how to develop the site.

“Recognizing the outstanding natural features of the Pitons as an international attraction,” Cousteau wrote, “the OAS recommended keeping this jewel as a centerpiece through the establishment of the Pitons National Park, a reserve that would attract tourists to its landscape, nature trails and underwater scenery.”

By Cousteau’s account, the OAS report predicted the park would improve economic conditions in Soufriere by stimulating peripheral businesses as well as generating funds to improve the town’s public services—such as sewerage treatment. The OAS projected costs for creating the park at roughly US$1.6 million, likely to be raised from international development sources, and estimated US$8 million in annual income to Soufriere by the park’s third year. It also predicted the creation of 400 permanent jobs.

The non-binding OAS study concluded that a private hotel and villas between the Pitons, then contemplated by outside investors for the Jalousie area, would be incompatible with the park, and that the success of the small hotels, villas and guest houses, as well as other tourism-supporting small businesses, would be doubtful in the absence of the park. Observed Cousteau, tellingly: “What is at play now in Saint Lucia are two alternative philosophies likely to come into increasing conflict as the world’s undeveloped places become fewer: one would preserve their untouched quality to create monetary value; theother would alter their quality to create value. Only time will tell which strategy does the most good for the people of Soufriere, home of the Pitons.” Well, now we all know!

As for our Nobel winner, he fired off several protest letters to the STAR, more than one referring to “the rape of fair Helen.” Walcott concluded that “only minds incapable of metaphor” could have negotiated the sale of land between the Pitons for a hotel.

He added: “May the next generation curse a government so blind it handed over a nation sealed, delivered and signed.”

Then there was the previously unheard of Saint Lucia Environment and Development Action Council (SLEDAC). Prominent members included the aforementioned artist Xavier, UWI lecturer Dr. Len Ishmael, and George Odlum’s then favorite intellectual Kenny Anthony. With Derek Walcott always present at their protest meetings with the press, SLEDAC was guaranteed weekly headlines.

But enough, for now. The rest of the Mahvi-Jalousie story is detailed in Lapses & Infelicities. Suffice it to say the hotel that opened for business on October 2, 1992 proved a miserable failure, for several reasons—the main one being the boss’ penchant for interfering with hotel operations about which he knew nothing at all. At any rate, so his managers claimed. On at least one occasion the John Compton government had appealed to local business houses to eat Prince Mahvi’s mountainous debts.

Predictably on hand at the big event was the day’s prime minister John Compton (his wife would in time operate her own boutique on the premises). He took the opportunity to reminisce about past “moonlit cruises in the valley of the Pitons” aboard his boat, in the process reducing knowing guests among the invited 2,000 to tears of concupiscent delight. (According to Colin Tennant, Compton had given the Jalousie developers every incentive not to abandon their plans. At one of their several meetings at the height of the to build or not to build controversy, said Tennant, the prime minister had advised the Iranians to “do what you have to do. I won’t mind a bit if you have to break one or two mosquito kneecaps along the way!”)

He declared the occasion “a night for lovers” and gently admonished “persons who criticized the government for permitting this development.” No need for names. Only a few in his audience may not have known he referred to the then Afro-ed and lean Kenny Anthony—destined to sing for his own Jalousie supper, prepared by tone-deaf strangers—and to the Nobel-bound Walcott.

The poet had dismissed the government’s pro-Jalousie exhortations as “the argument of whores!”

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