Ex-employees detail sex for pay, police find cache of high-end lingerie as …

Madison police have completed their secret investigation into the Rising Sun, uncovering evidence of tax fraud and running a house of prostitution against the Downtown bathhouse’s owner, Charles Prindiville, according to recently unsealed court records.

The case now resides with the Dane County district attorney for possible charges.

Police claim that Prindiville and his now ex-wife, Catherine, under-reported income from the business, which operates almost entirely on cash and, police allege, is a front for prostitution. Prindiville couldn’t be reached for comment but in a past interview with the State Journal denied the prostitution allegations, saying his female staffers offer customers back rubs — and nothing more.

Search warrants unsealed last month include names of dozens of employees at the business in 2009 and 2010, taken from business records and tax returns, and interviews with some of them about the nature of their jobs.

One former employee told police she was fired after two days for refusing to provide clients “full service” and said a client complained to management after she refused to get into a hot tub naked with him.

Another ex-employee told police she worked at the business for eight years starting when she was 18. She was picked by Charles Prindiville to serve an older client who has been Prindiville’s accountant since 2003. The woman told police the accountant regularly paid her $300 for sexual intercourse over a two-year period and that she was made to accompany him on social outings away from the business.

“It felt like I had to do this,” she told police, noting that she felt pressure from both Charles Prindiville and his son Mario, who manages the business.

Police: Taxes don’t add up

Rising Sun, under its previous corporate name of Butterfly Tub Sauna, reported net losses on its 2007, 2008 and 2009 federal tax returns obtained by police. The reported losses ranged from $12,873 in 2009 to $32,784 in 2008.

The losses were countered by evidence of significant cash and assets uncovered in police raids. When the business was first raided in October 2010, police found $7,000 in cash and money orders on Charles Prindiville. A search that day of the Middleton home he shared with his then-wife found $10,000 more in cash and coins plus a surprising haul of clothing and accessories.

Police found an estimated $28,000 worth of new and gently used women’s wear, including more than 400 pairs of jeans, 378 pairs of underwear, 138 pairs of shoes, 92 purses, 68 pairs of socks, 63 bras, hundreds of shirts and several bottles of perfume. Many were new in boxes with price tags still attached, including brands such as Victoria’s Secret, Juicy Couture, Miss Me, Coach and Gucci.

“(I) noticed the discrepancy between the large amount of clothing items that Catherine Prindiville owns and the three years of net loss that the business in which Catherine Prindiville was listed as the sole owner shows,” wrote Det. Maya Krajcinovic, the lead investigator.

Krajcinovic also pointed to evidence that the Prindivilles made nearly $21,000 in deposits to a bank account over a 20-day period in September 2010 and paid cash for living expenses including utilities, health insurance premiums and post office money orders.

“Any cash derived from a business operation that is skimmed off and not reported as income to that business and further used for personal purposes would constitute taxable income,” she wrote. “Failure to report that income as taxable income on a personal income tax return could result in criminal charges for tax evasion.”

Butterfly Tub Sauna was incorporated with the state in 1999, with Catherine Prindiville as its registered agent, according to state records. The company was administratively dissolved by the state due to delinquency in December 2008, then restored in January 2009, according to state records. It again was dissolved in September 2011.

Catherine Prindiville, in previous interviews with police and the State Journal, has denied direct involvement with the business despite being its registered agent. She and Charles Prindiville were divorced last October, according to court records.

The company was re-registered with the state as MJCP, Inc. in August 2011, with Mario Prindiville, Charles’ son, listed as the registered agent. The new address for the corporation is the Far East Side home office of Christina Mandeville, Prindiville’s former accountant. The new company was administratively dissolved due to delinquency in July.

Last bathhouse Downtown

The testimony in the recently unsealed search warrants builds on previously released search warrant returns. The investigation has been going for nearly four years, with four special agents with the state Department of Revenue periodically assisting police.

It began with the twin raids of the business at 117 W. Main St. and the Prindivilles’ home in 2010.

In the years that followed, the business has remained open and others have brought new allegations of prostitution there.

Police have obtained many more search warrants that led to the collection of rooms full of documents, computers, cars and other evidence from a variety of places: the offices of two accountants who have helped Prindiville file his yearly returns, a storage locker rented by Catherine Prindiville, a company that hosted the Rising Sun website and others.

While dozens of employees of the business are named in the warrants, few of its customers have been named.

Dane County judges agreed to seal most records in the case throughout the investigation. Police have consistently declined to comment on the investigation. The prosecutor in charge of the case, Paul Barnett, also declined comment when reached Tuesday.

Mayor Paul Soglin said he was aware of the investigation but hadn’t heard it had been finished by police. When asked how the business has been allowed to operate for so long — it’s the only remaining bathhouse Downtown, a throwback to a time in the 1970s and 1980s when such establishments were numerous — he noted enforcement challenges.

“We can only close down an operation if it’s doing something illegal,” he said. “Just as we’ve found with (unlicensed taxicab companies) Uber and Lyft, sometimes detecting illegal activity by a business is not all that easy,” since proving the crimes requires catching people in the act.

Despite its conspicuous location on West Main Street just blocks from the courthouse, the police station, the state Capitol and City Hall, Rising Sun goes mostly unnoticed by its neighbors and draws very few complaints, said Ald. Mike Verveer, 4th District, who represents the area.

In part, Verveer said, that’s because it sits on the second floor on a block full of bars, which typically attract bigger crowds and more urgent problems, including fights, noise and public drunkenness.

A State Journal review of police records found comparatively few calls to the business since 1980. Police were called there for prostitution-related complaints just five times in 30 years.

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