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Thursday, November 26, 2015

Who is Charles Suresh Morais?



Until yesterday evening, perhaps only those in the business circles knew who Charles Suresh Morais, a Malaysian living in the United States, is.
But following his explosive statutory declaration (SD) regarding his late brother, the major player in the hotel industry has now become a household name.
Charles had alleged a conspiracy in the murder of former senior deputy public prosecutor Kevin Anthony Morais, whom he claimed was working on a case involving the prime minister and his wife.
The Altanta-based businessman also claimed to be in possession of a pen drive with details of the cases his brother was working on.
Charles claimed that the pen drive is with someone in the US, who has been given instructions to expose the contents if something untoward happens to him.
A check by Malaysiakini revealed that Charles serves as the chief executive officer of Kronos Hotels and Resorts, which had been acquiring hotels in the US since 1999.
In 2007, Bernama reported that Charles' Atlanta-based hotel chain had, in June 2006, bought a portfolio of 16 hotels with 3,100 rooms.
The chain already had 26 hotels under it, and had also in the same year announced plans to acquire 12 other properties outside the US, including two hotels in Malaysia.
Some of the hotels under the Kronos chain include The Crowne Plaza, Holiday Inn, Wyndham Hotels and Resorts, and Choice Hotels International.
Financial troubles and court cases
However, financial troubles started escalating in 2008.
A 2008 report by the St Louis Post-Dispatch stated Morais was arrested by police in August of that year and faced extradition to Arkansas for fraud charges for writing bad cheques.
An extradition hearing was held a month later and according to a sheriff's office, he had appeared to have settled the charges with the Pope County prosecuting attorney's office.
Around the US, several Kronos hotels faced various accusations by local governments of not paying sleeping room taxes and bouncing employee pay cheques.
Three years later, The Wall Street Journal (WSJ) reported that Charles had lost 11 properties after falling behind on payments.
The Pennsylvania attorney-general's office had filed criminal charges against him and co-owner Sunil Mir on 26 counts each, tied to their alleged failure to pay US$310,849 in state sales tax and US$37,020 in withholding tax.
WSJ reported then that they were close to losing the JFK Plaza Hotel- the crown jewel of their empire.
After a bankruptcy-court auction of the property, a trustee in the case had recommended that the property be conveyed to Neshgold LP, a secured creditor with a US$16 million claim against the property.
Charles had then however said that the JFK Hotel was "never a day late or dollar short" on its loan and partly blamed "people trying to squeeze minorities and rob them" for their financial problems.
They had purchased the JFK Hotel in 2006, paying close to US$11 million. Most of the deal was financed with US$9.75 million in loans from Fortress Credit Corp.
Charles' financial problems surfaced in April 2008 when mortgage-backed securities issued to finance the 2006 Lodgian deal were transferred to a special servicer.
The businessman however said Kronos had never defaulted on the loan and that its equity partner took over the hotel portfolio.
"Kronos fell behind because lenders were controlling its access to revenue," he was quoted as saying then.
WSJ however noted how that same April, Kronos was announcing other deals, including a hotel development in Atlanta's Buckhead section that never moved forward.
Charles' court cases have also emerged on certain blogs with the motive of discrediting him, following his SD which has been dismissed as "wild" and a "charade", among others.
Malaysiakini has contacted Morais and is awaiting his response on the matter.
However, a source close to him claimed that the financial troubles and legal wrangles were matters of the past.
"Bankruptcy was in 2008 after the crash (subprime mortgage crisis) like every other businessman. But he bounced back. He is in business again and doing very well.
"He is negotiating the purchase of six hotels here in Malaysia at the moment," he added.
According to a check on the US' Public Access to Court Electronic Records (Pacer), it was found that the cases mentioned in the previous reports are also no longer active. -Mkini

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