The chairman of the Williamsburg Planning Commission is once again facing allegations of embezzlement — but this time the case is unfolding in civil court.
Demetrios Florakis, who has served on the commission since 2012 and was appointed chairman in 2014, is being sued by his younger brother, who alleges the chairman embezzled funds from multiple companies co-owned by the brothers, using corporate profits to pay off personal debts without consulting his brother or reimbursing the companies.
Nicholas Florakis, represented by the law offices of Bischoff Martingayle, has filed an injunction against his brother and three businesses they own, according to documents filed in the Williamsburg-James City County Circuit Court last month.
While the younger Florakis is not seeking any damages in the suit, he does request the dissolution and liquidation of three companies shared equally between the brothers, Gladiators, Inc., Morpheus, Inc. and Alcimedes, Inc. The brothers are the only shareholders, directors and officers for each company.
The three business entities control multiple commercial properties — including two IHOP franchises — in the greater Williamsburg area, according to court documents.
“Notwithstanding the alleged poor performance of the businesses, D. Florakis has managed to own at various times ultra-luxury automobiles such as an Audi R8, Aston Martin, Ferrari, Porsche and Bentley, as he has taken his family on lavish vacations,” the suit alleges.
The suit claims when Nicholas Florakis confronted his brother about the unauthorized spending, Demetrios Florakis allegedly responded by questioning the brother’s loyalty to their family, becoming “increasingly evasive and angry,” even physically violent on one occasion.
The attorney representing Demetrios Florakis, Senator Tommy Norment, denied the allegations against his client, and added the lawsuit has not yet been served to his office.
“Demetrios and myself emphatically deny there has been any embezzlement,” Norment said.
Bad blood
A week prior to Nicholas Florakis filing suit against his brother, Demetrios Florakis filed a multi-million dollar defamation lawsuit against five former co-owners in another real estate company the two brothers controlled called Delphi, Inc. Nicholas Florakis was not named in the suit, which claims the defendants published “false and malicious words” defaming Demetrios Florakis, publicly accusing him of theft and embezzlement.
Filed April 7, the lawsuit was entered with just hours to spare in Virginia’s one-year statute of limitations on libel.
One year before, on April 8, 2016, Special Prosecutor Matthew Kite, the commonwealth’s attorney for King William County, issued a motion not to prosecute Demetrios Florakis and contractor James Jenkins on charges of felony embezzlement and grand larceny, respectively.
Both men were directly indicted to Williamsburg-James City County Circuit Court on the charges in January 2014, about nine months after local construction company Courthouse Construction Inc. filed a complaint with the Williamsburg Police Department about theft of materials from a work site.
Court documents state Demetrios Florakis, a developer who owns several properties throughout the city, had partnered with the company on the City Lofts project to convert a Quality Inn on Richmond Road into one-bedroom apartments for students. The construction firm accused Florakis of using materials from their partnership on a construction project at a Florakis-owned apartment, the Vernon Geddy House on Scotland Street, not associated with Courthouse Construction Inc.
The two men did not face trial as Judge Michael McGinty nolle prossed the charges against them on April 8, 2016. If charges are nolle prossed, it means the prosecution will not pursue the charges unless new evidence comes to light.
Off the books
When it came to financials, Nicholas Florakis alleges Demetrios Florakis has always insisted on handling company funds, while the younger brother managed day-to-day operations.
Among claims made by Nicholas Florakis against Demetrios Florakis are intentionally misrepresenting company values, decreasing Nicholas Florakis’ financial compensation, fraudulent transactions, and payment of an employee off the books.
The younger Florakis claims Demetrios Florakis’ longtime accountant and former Williamsburg Mayor Gilbert Granger assisted in some of the alleged fraudulent activities.
When contacted Friday, Granger said he was unfamiliar with the allegations against him, so did not want to confirm or deny them.
“They are both good people and it’s a shame when families fight,” Granger said of the brothers. “I try to give them both good advice.”
Nicholas Florakis has requested a court-appointed third-party audit to review company books and records to determine the extent of his brother’s alleged misconduct. He also requested the courts appoint a custodian to manage and preserve the corporate assets until a hearing is held.
Norment said he believes the case will be settled out of court.
“I have been in communication with his brother’s attorneys and we are working an amicable resolution to what I would refer to as a business divorce,” Norment said.
Adrienne Berard contributed reporting. WYDaily archives were used in this article.
