Settlement pending on Fuji assets

City may acquire massage parlor property, assessed at $418,350

Nan O’Reilly



Federal prosecutors have reached a tentative settlement that spells out the future of several properties and bank accounts that were seized by the U.S. Treasury Department during an investigation of what authorities believed to be a local prostitution business, according to a recent court filing.

“The parties are currently working on memorializing that agreement in writing,” Assistant U.S. Attorney Tonya Andrews wrote in a motion filed in U.S. District Court in Denver.

While the terms of the agreement haven’t been made public, the deal is expected to address plans for the former Fuji Oriental Massage Therapy building, 762 Horizon Drive, which was one of five properties seized by the government and owned by 60-year-old Nan O’Reilly.

She has pleaded guilty and faces sentencing next month in Mesa County in connection with Fuji’s former activities.

The city of Grand Junction is interested in acquiring the property, and city staff has been in talks with U.S. Treasury officials about the building’s future, according to city spokeswoman Sam Rainguet.

Shuttered in December 2008 after authorities arrested O’Reilly and closed the business, the building’s front entrance remains locked behind an iron gate with a large plant still sitting in the front window, withered brown and dead.

Fuji’s property includes just over half an acre and has an assessed valuation of $418,350, according to the Mesa County Assessor’s Web site.

Aside from the Fuji building, U.S. Treasury officials seized O’Reilly’s condominium at 3154 Lakeside Drive and another home at 2330 Marston Drive in Colorado Springs.

Two other properties owned by O’Reilly on the outskirts of Colorado Springs were seized during the investigation, as well as two bank accounts.

Federal prosecutors alleged that proceeds from O’Reilly’s business in Grand Junction were used to pay taxes on the properties.

Court filings do not specify the amount of cash that was seized.

One bank account linked to Fuji Massage had deposits totaling $530,000 over 16 months ending in August 2008, more than $126,000 of it in cash, authorities said in earlier filings.


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