‘Illicit,’ under-the-table deals part of Myrtle Beach motel purchase, court filings state
Allegations of secret payments and a cash-packed envelope being handed off in a parking lot were some of the “illicit” activity that occurred during the 2015 sale of an oceanfront motel.
Those two details highlight the latest filing in the ongoing lawsuit over the sale of hotels and a home near 7th Avenue Beach in Myrtle Beach.
The Rabon family owned the properties in question and sold them to avoid foreclosure.
But, Karon and Kyle Mitchell say they were done fraudulently by Jack Rabon and others. Jack Rabon and Karon Mitchell are brother and sister.
Soon after their mother died, Jack Rabon voted himself president and vice president of the company and took over majority control. The hotels were sold in 2015, and in 2017, Karon and Kyle Mitchell filed suit over the deal.
In the initial lawsuit, they asked a judge to void the sale and noted the fraudulent activity.
The Mitchells named Jack and Nicole Rabon, Lane Jeffries and a host of the other people and companies as defendants in the case.
Last week, the Mitchells asked for judgment in their favor related to the sale of the old Palms Court motel and a house near 7th Avenue North.
In 2015, Jacob Biderman — an Austrian resident and operator of a Jewish-education institution in Myrtle Beach, through the company Friends of LBC LLC — agreed to buy the hotel and house properties for $542,000.
Michelle Cohen was the realtor involved with the deal, according to court records.
Because of the pending foreclosure and belief that no better offer existed, the Mitchells agreed to the $542,000 sale, according to the filing.
The Mitchells claim the sale was actually for $777,000 with the remaining $235,000 paid to Jack Rabon and others, under the table, via wire transfers.
The Mitchells called the $235,000 “illicit funds” that were not made public nor shared with a probate judge when the sale completed.
Some of the money went to a shell corporation that Jack Rabon accessed, the filing states.
The other portion, $100,000, went through a bank account in Chile that was tied to Cohen, the filing states.
Soon after the sale, Jeffries picked up Jack Rabon and they went to a 38th Avenue parking lot and met with Cohen. There, Cohen handed an envelope with $50,000 inside and Rabon gave Jeffries $100,000.
The Mitchells’ filing also contends that groups owed money by the hotel and house received only pennies of what they could have received because of the alleged fraud.
Several of the defendants could not be reached in time for this report. Cal Watson, attorney for Jeffries, declined to comment.
This story was originally published March 11, 2019 at 3:11 PM.
