Galanis Waives Extradition, Will Go to N.Y.

John Peter Galanis, a Del Mar man arrested Tuesday on massive racketeering, tax and investment fraud charges, waived extradition proceedings Wednesday and is scheduled to be flown to New York this morning to face allegations that he bilked investors out of millions of dollars.

Wearing a rumpled blue suit and a two-day growth of beard, Galanis appeared tired and nervous at an extradition hearing before Municipal Court Judge Richard J. Hanscom.

In a separate proceeding Wednesday, Galanis was arraigned in U.S. District Court here on federal charges of fraud and racketeering that carry combined maximum penalties of 25 years in prison and $500,000 in fines.

The 44-year-old investment promoter is scheduled to be arraigned today in Manhattan on larceny charges lodged by New York state authorities, his attorney Jerry Coughlin of San Diego said Wednesday.

Also Waives Hearing

Laurence Klusky, 40, a Galanis associate who was arrested at his San Diego home Tuesday, also waived extradition proceedings and is expected to be taken to New York today.

Galanis was arrested without incident at his Del Mar home at 5 a.m. Tuesday by New York Police Department detectives on a complaint filed by the U.S. attorney for the Southern District of New York. The NYPD detectives were accompanied by agents of the Federal Bureau of Investigation, Internal Revenue Service and the San Diego County District Attorney’s office.

The federal complaint accuses Galanis of organizing fraudulent oil and gas and hotel rehabilitation tax shelter programs. The IRS said the fraudulent tax shelters cost the U.S. government $172 million in bogus tax deductions.

Galanis and his associates are also charged with bribing officials at a New York state bank and of fraudulently obtaining control of Heritage Bank and Trust of Salt Lake City, Utah.