Tolland Strip Joint Owner, Staffers Charged With Sex, Tax Crimes

TOLLAND, CT — The owner, manager and a bouncer at a Tolland strip club have been charged with several crimes in a 12-count federal indictment, federal authorities announced Wednesday.

Vanessa Roberts Avery, United States attorney for the District of Connecticut; Michael J. Krol, special agent in charge of Homeland Security investigations in New England; Harry T. Chavis Jr., special agent in charge of the Internal Revenue Service Criminal Investigation Unit in New England; and Connecticut State Police Col. Daniel Loughman announced that a federal grand jury in Hartford has returned a 12-count indictment charging Kenneth Denning, 67, of Holland, MA; Joshuan Baker, 41, of Willimantic; and William Mayor, 41, of Manchester; with offenses stemming from the operation of the Electric Blue strip club in Tolland.

The indictment was returned Tuesday and Denning, Baker and Mayo were arrested Wednesday, Avery said.

According to the indictment, Denning owns and oversees the operation of the Electric Blue, which has employed dancers over the years who performed on stage nude and gave "lap dances" for customers.

Baker was the club's manager and bookkeeper and Mayo was employed at the club as a bouncer and was primarily responsible for hiring dancers, many of whom were not legally authorized to live or work in the United States, Avery said.

The indictment also accuses the Electric Blue of offering a semi-private "lap dance room" and "VIP rooms," where dancers regularly performed "commercial sex acts for customers."

The indictment also said that, as payment for the "commercial sex acts," customers would typically pay the club an entry fee for use of the lap dance room or one of the VIP rooms and then pay an additional fee directly to the dancer."

In addition, the club collected cash through cover charges paid at the door and fees paid by dancers to perform at the club, according to the indictment.

Baker or another club employee would collect the cash received by the club, place the cash in envelopes noting the source of the cash, and then place the envelopes in a safe in Denning's office, the indictment charges.

The defendants referred to the cash as "Kenny's money," and used the currency to pay business expenses and fund Denning's personal expenditures, including trips to casinos where Denning spent large sums of money, according to the indictment.

The indictment also accuses Denning and Baker of providing false information to the club's tax preparer in 2020, 2021, and 2022 by underreporting the gross receipts from the club and excluding income derived from "commercial sex acts."

As much as $5.7 million in business receipts were not reported to the IRS, causing a tax underpayment of more than $2 million, Avery said.

The indictment further accuses Denning of committing fraud by "applying for and receiving an Economic Injury Disaster Loan" during the COVID-19 pandemic by certifying that the business did not "present live performances of a prurient sexual nature."

Denning received a loan of approximately $150,000 in July 2020, Avery said.

The indictment charges Denning, Baker and Mayo with conspiracy to use an interstate facility to promote or facilitate prostitution, an offense that carries a maximum prison term of five years, and with unlawful employment of aliens, an offense that carries a maximum prison term of imprisonment of six months.

Denning and Baker are charged with conspiracy to file false tax returns, which carries a maximum prison term of five years and with conspiracy to commit promotional and concealment of money laundering, which carries a maximum term of 20 years, Avery said.

Denning is charged with engaging in a monetary transaction with proceeds derived from prostitution, an offense that carries a maximum term of 10 years, Avery said. That charge is related to a cash deposit of approximately $21,700 at Mohegan Sun casino, Avery said.

He is also charged with aiding and abetting the filing of a false tax return related to his personal tax return for the 2020 tax year, an offense that carries a maximum term of three years, and with willful failure to file his personal tax return for the 2021 tax year, an offense that carries a maximum term of one year, Avery said.

He is also charged with wire fraud in connection with his receipt of the EIDL loan, which carries a maximum term of 20 years, Avery said.

Federal and state agents raided "The Blue" on March 16, 2023. Several state police cruisers and the major crimes unit mobile office were parked at the 62 Merrow Road location for several hours. Federal vehicles with homeland security agents were also at the scene.

Local authorities have battled with the club's owners for the better part of three decades over the club's presence and business practices and, at one point, there was a movement on the town council to actually purchase the property. The movement failed to gain enough momentum to carry out the plan.

Federal authorities said that any employee or dancer at the Electric Blue who "has been a victim of the unlawful acts described in the indictment," can contact the U.S. Attorney’s Office Victim Advocate at usact.vns@usdoj.gov or 203-696-3039.