New York Elites, a bustling Manhattan escort service, has gone national in recent years, flying women to 22 cities around the country to be “nightlife companions” for customers who pay up to $1,500 an hour.
While the company’s Web site warned that the customers should not expect sex, federal customs officials in New York said yesterday that the company was essentially a prostitution racket. Two owners and two employees of New York Elites were arrested Monday on federal charges of interstate prostitution and money laundering, accused of concealing at least $5.5 million in illegal revenues. At a hearing yesterday in Federal District Court in Manhattan, one owner, Elena Trochtchenkova, 40, said she was not guilty, and was released on a $1 million personal bond. The other owner, Rady Abdel Salem Abbassy, a 45-year-old Egyptian, remains in custody because he is an illegal immigrant, said the prosecutor, Benjamin Gruenstein.
Documents and ledgers seized by federal agents showed that the company’s owners set up dummy firms to launder the cash and credit card payments the women received for their services, the authorities said.
Operating from offices at 12 East 32nd Street in Manhattan, New York Elites offered its services on a Web site that let a customer choose an escort on the basis of a personal profile and fetching photographs. The company had at least 200 women on its roster, with as many as 40 active each day, said Martin D. Ficke, the senior Immigration and Customs Enforcement special agent in New York.
According to the complaint, after clients called a telephone number listed on the Web site, and were screened to determine if they were law enforcement officers, they could hire women according to looks or the type of sex acts they were willing to do, the authorities said.
The complaint is based on testimony from three cooperating witnesses who worked as escorts, Mr. Ficke said.
New York Elites’ Web site says the company is “a referral service for independent contractors,” and adds, “We do not provide illegal sexual activities.”
In a search of the company’s offices on Monday, agents found a box of index cards detailing sex acts the women would and would not engage in, and their rates. The agents also recovered a list of clients’ names and credit card receipts.
The company rented hotel rooms in Boston, Chicago, San Francisco and other cities, where the escorts would stay for up to two weeks at a time. In September 2003 alone, the company paid $61,434 in hotel bills, the complaint said.
Ms. Trochtchenkova and Mr. Abbassy charged the escorts a 50 percent commission and set up bank accounts in the names of at least two nonexistent companies, through which they moved their earnings to conceal the origin of the money, prosecutors said.
Two employees who were also arrested, Valerie Hairston and Nancy Khaja, were released on bail. Ms. Trochtchenkova, Mr. Abbassy and Ms. Hairston each face up to 30 years in prison and an $11 million fine. Ms. Khaja, who was a receptionist, faces lesser charges.