Traverse City Record-Eagle

April 6, 2010

Sugar Loaf buyer faces charges in Calif.


TRAVERSE CITY -- A Las Vegas entrepreneur who plans to buy Leelanau County's long-shuttered Sugar Loaf Resort faces multiple criminal charges in California, though he contends he's "not a crook."

Eneliko "Sean" Smith said he plans to spend about $10 million to buy the resort and open at least a portion of it by July 4. But he faces felony grand theft and embezzlement charges in California's El Dorado County, and is the subject of numerous derisive Internet postings about past business endeavors.

On Monday, Smith said "everybody makes mistakes," and said he remains committed to the Sugar Loaf purchase.

"If the citizens of Leelanau County and Traverse City want that place open; I'm the guy to do it," he said.

The once-popular Sugar Loaf resort covers several hundred acres in Cleveland and Centerville townships. It closed in 2000 amid a sea of financial troubles and back-to-back poor snow seasons. Attempts to reopen it never materialized.

Smith, who owns and operates several hotels, was charged in California in 2008 after he allegedly failed to pay about $92,000 in taxes on a hotel he owns in South Lake Tahoe, police there said.

A spokesman for El Dorado's district attorney didn't return repeated calls for comment, but Smith's attorney, William Cole, said a plea is scheduled in the case. Smith will pay the back taxes and plead to a misdemeanor, Cole said.

Leelanau County Commissioner Melinda Lautner wonders how plenty of red flags went unnoticed as Sugar Loaf's owners and some county officials touted Smith as an ideal buyer.

"I'm greatly concerned that there are people in our county that were this far along in agreements and plans, etcetera, and hadn't even Googled the guy," she said. "I'm kind of stunned."

Still, Lautner said, concerned county officials won't have much say in the matter if Smith doesn't opt to use brownfield dollars or other public incentives.

"On a totally private deal, the county has absolutely no involvement," she said.

Commission Chair Mary Tonneberger agrees.

"I don't think we have the ability on a private sale to examine the financial status of the buyer," she said.

But e-mails still poured into county offices after the Record-Eagle on Saturday published a story about Smith's plans for Sugar Loaf. Glen Arbor resident Molly Melin, 29, was among several people who expressed their concerns.

Melin believes the public deserves to know exactly what Smith plans to do with the resort, and thinks county officials need to take an interest in the pending deal.

"It's just a little shady when your resume is based on defending everything you've done in the past," she said, referencing a section of Smith's Web site where he addresses negative accusations against him.

Commissioner David Shiflett, who helped arrange a Record-Eagle reporter's interview with Smith last week, said everyone has "skeletons in the closet" and suggested the media can sometimes do damage by writing stories about someone's past.

Shiflett said the county only should get involved with investigating Smith if Smith decides to accept any form of public funding for the project.

"We haven't expended any tax dollars to benefit this buyer," he said.

Kate Wickstrom, who owns the ski and hotel portions of the resort, said she wasn't aware of any problems in Smith's past. She believes Smith should be given a chance to succeed.

"I'm not going to stop the sale from going through; people want Sugarloaf back," she said. "I couldn't do it because of the stops people put on me, and I'm not going to put stops on Sean."

Smith contends he wouldn't be able to secure a bank loan for the Sugar Loaf purchase if bank officials had significant concerns about his past.

"Why would (the bank) work with me if I was such a crook? Banks look a lot deeper than what they read online," he said.

Leonard Zedeck, an attorney and principal for TransCapital Bank, couldn't be reached for comment. TransCapital controls the mortgage on the property.

Related Story: Entrepreneur plans to buy shuttered resort