Robbins-Led Venture Seeks Bankruptcy : Real estate: Partnership headed by the state senator files for Chapter 11 protection. Its biggest debt, $3.4 million, is to a bank linked to BCCI.
A real estate partnership led by state Sen. Alan Robbins (D-Van Nuys) has filed for bankruptcy, listing $7.6 million in debts to prominent Los Angeles developers, lawyers and banks.
The partnership’s biggest single debt is $3.4 million to an Encino bank linked to the scandal-ridden Bank of Credit & Commerce International.
Robbins is the majority partner in Marina East Holding Partnership, which filed for protection from creditors under Chapter 11 of the U.S. Bankruptcy Code on July 22. His only partner in the venture is Los Angeles attorney Marvin Kay, a close friend.
Marina East’s lawyer, Lawrence A. Diamant, said the bankruptcy filing was triggered in part by the sluggish economy, which has slowed development of a massive Venice commercial and residential project in which Marina East has a big financial stake.
The $400-million project, called Channel Gateway, includes more than 1,000 living units along with an office building containing 314,000 square feet of space.
Robbins, who has grown wealthy developing offices, medical buildings and apartment complexes in Los Angeles and Ventura counties, said the bankruptcy has not seriously harmed his personal finances.
“I had a substantial net worth before I was elected to office and that remains so,” he said.
According to documents filed in support of the bankruptcy petition, Marina East’s largest creditor is Independence Bank of Encino, the San Fernando Valley’s biggest commercial bank.
Federal bank regulators this week imposed $37 million in fines on Saudi Arabian financier Ghaith Pharaon for concealing his 1985 acquisition of Independence on behalf of Luxembourg-based BCCI. BCCI is under investigation in more than two dozen nations for alleged involvement in a worldwide fraud scheme and for allegedly financing terrorism and drug trafficking.
According to public records, Robbins and Marina East have received at least two loans totaling more than $7 million from Independence.
Marina East made Independence a partner in 1990 as security for the loan on which Marina East still owes $3.4 million, bankruptcy papers said. The loan is accumulating interest of more than $1,000 per day.
According to Los Angeles County property records, Independence also loaned Robbins personally up to $3.6 million in 1989. That loan was secured by property held by Marina East, records said. Robbins said the loan has been repaid.
Asked if he was concerned about possible political fallout from his dealings with Independence, Robbins said he would have sought other sources of financing had he “known then what I know now.” He added that he was a customer of the bank before the BCCI takeover.
Robbins, who is Jewish and often backs Israeli causes, said he was concerned enough about Pharaon’s background to question Independence officials and was told he was “a British subject, not a citizen of Saudi Arabia.” Saudi Arabia has long supported the Arab boycott of companies that do business with Israel.
Pharaon’s lawyer in New York could not be reached for comment.
In addition to the loans, Robbins accepted $7,200 in campaign contributions from Independence between 1985 and 1989, according to a computerized campaign reporting service.
Marina East’s other major creditors, according to the bankruptcy papers, include three Century City law firms, which are owed more than $541,000.
Marina East owes $450,000 to one firm in which former Los Angeles City Atty. Burt Pines is a partner. The firm, Alschuler, Grossman & Pines, has defended Robbins and Marina East in a lawsuit brought by a former business partner, La Jolla investor Jeremy Simms.
The other Century City law firms are Irell & Manella and Katten, Muchin, Zavis & Weitzman.
In the Channel Gateway project, developer Jerome Snyder and partners bought 16 acres of land from Marina East for $45 million in 1989. According to bankruptcy papers, Marina East retains an interest in Channel Gateway worth at least $15 million.
Construction has begun on the apartments, but the project suffered a setback last year when L.A. Gear, a firm that makes athletic shoes, backed out of negotiations to be the prime tenant of the office building. Snyder is seeking a new anchor tenant.
Diamant said he anticipates that Marina East’s debts will be fully repaid “in the next six months to a year” when Channel Gateway becomes profitable.
In a recent interview with The Times, a Snyder partner, developer Jona Goldrich, said he testified six to eight months ago before a federal grand jury in Sacramento that is investigating Robbins in connection with a wide-ranging political corruption probe.
Goldrich said he was questioned about Robbins’ sale of the Channel Gateway property to Snyder’s group. Goldrich said he was not involved in the sale and that his testimony lasted only a few minutes. Marina East owes Goldrich and Snyder $2.5 million, according to bankruptcy papers.
Robbins is under investigation to determine, among other things, whether he had a role in an alleged scheme to extort $250,000 from a San Diego hotel developer, according to sources familiar with the inquiry. The investigation is an outgrowth of an FBI sting operation that has led to the conviction of two former state senators.
According to bankruptcy papers, Marina East in June stopped making payments on a $2.6-million loan from Sumitomo Bank. Diamant said that situation was another “triggering factor” for the bankruptcy.
Times staff writer Jeffrey L. Rabin contributed to this story.
