Embezzlement at Rich City Rides Bike Skate Shop Coop

~2021~

• During COVID the Bike shop experienced record sales and even turned a small but substantial profit for the first time.

• During the end of 2021 differences of opinion regarding the bike shop’s business management began to emerge between Najari Smith and Roshni Felonte (Taye) McGee. 
  • Specifically, Mr. McGee:
    • Did not support adding additional cooperative members but instead wanted only employees
    • Mr. McGee continually voted against liquidating older or damaged inventory, which is a standard bike shop practice
    • Mr. McGee voted down or did not support efforts to advertise
    • Mr. McGee tripled the cost of a flat fix from $21 to $65, making our community shop inaccessible to regular community members
    • When Mr. Smith was away in New York visiting his mother whom he was vying for custody of as she was a ward of the court, Mr. McGee reduced the shop hours unilaterally, resulting in greatly reduced sales opportunities. 
  • As shop sales declined due to these and other dubious business management practices, the shop’s debts began to increase.

~2022~

• February 2022 – Mr. Smith requested Mr. McGee attend bookkeeping meetings with a contracted external accountant to better understand the finances of the bike shop. Mr. McGee joined less than 5 of the 12 monthly Bookkeeping meetings. 

• Mr. Smith’s mother unexpectedly passed away at the end of February 2022.
  • Mr. Smith left to go to New York for several days to make funeral arrangements and handle the end of life business of his mother. 

• March 2022 –  While Mr. Smith was away attending to his mother’s funeral arrangements, Mr. McGee transferred the Shopify account (Point of Sale System – POS)  to a new admin email address richcityridesbikeshop14@gmail.com and gave himself sole administrative control of the account.
  • This change gave Mr. McGee the sole authority over the transfer sales proceeds made through the POS (Point Of Sale) system, the cash register at the BIke Shop, and authority over new bank accounts.
  • At this time he also removed Mr. Smith, the shop’s co-owner, as an admin on the POS account. Without administrative access Mr. Smith could only see sales reports but not manage any transactions or perform administrative functions. 
  • During this time, due to the complexities regarding Mr. Smith’s mother’s death, he spent a lot of time traveling back and forth to New York to handle his mother’s end-of-life arrangements, which were further complicated because of her status as a ward of the state. 
  • Due to this and the process of mourning his mother, Mr. Smith did not fully realize all of the changes that Mr. McGee made unilaterally to the Shop’s POS until early 2023.

~2023~

• March 2023 – Once Mr. Smith realized all the unilateral changes that Mr. McGee had made to the co-owned business, Mr. Smith reached out for mediation support to try to resolve this deepening conflict without calling in law enforcement.
  • Mr. Smith contacted a local cooperative law firm and a cooperative incubator organization to help negotiate a settlement to the dispute with Mr. McGee.  
  • During these mediation efforts, Mr. McGee discontinued the existing Bike Shop online store richcityridesbikeshop.com and launched rcrbs.com, where he began selling Bike shop inventory purchased with Rich City Rides Coop Bike Shop funds online through this new website and began depositing the proceeds to his personal bank account.

• April 2023 – Mr. McGee, again unilaterally, disconnected the Rich CIty Rides Coop Bike Shop’s official bank account from the POS system and connected his personal bank account to the POS system. He then proceeded to transfer ALL card sales made by customers at the register in the brick and mortar Rich CIty Rides Coop Bike Shop to his personal bank account.
  • Legal counsel advised Mr. McGee that diverting funds from the official business bank account to his personal bank account without agreement from the other co-owner was not legal. All parties urged him to disconnect the POS from his personal bank account and reconnect it to the Rich CIty Rides Coop Bike Shop bank account.
  • He initially refused this request and then later agreed but took no action.  
  • The POS system was NEVER reconnected to the Rich City Rides Coop Bike Shop bank account that was connected to the Rich City Rides Coop Bike Shop’s legal EIN. 
  • *At this point, the Richmond Police Department was given bank and POS system transaction reports as evidence.

• From May 2023 – January 2024 Mr. McGee continues these actions by redirecting ALL bike shop sales (cash and card) to Mr. McGee’s personal bank account, leaving all vendor bills, payroll checks, payroll taxes, sales tax payments, and rent payments to be deducted from the Rich City Rides Coop Bike Shop bank account. This continued until all funds were exhausted, as no new sales proceeds were being added to the Rich City Rides Coop Bike Shop account to cover these and other shop expenses.
  • During this time, Mr. McGee continued to use the Rich City Rides Coop Bike Shop’s EIN and California reseller’s ID. He also used the Cooperative’s vendor accounts to purchase new inventory on the Rich City Rides Coop Bike Shop’s credit accounts; he then sold that inventory and deposited all proceeds to his personal bank account.
  • Mr. McGee also continued to use his Rich City Rides Bike Skate Shop Coop business American Express card throughout this time (card statements indicating card user corroborate this).
  • These actions contributed to the mounting loan, tax, credit card and vendor credit debts of the Rich City Rides Coop Bike Shop.

• July 2023 – December 2023,  Najari Smith was still trying to use community and legal negotiators to resolve the conflict, still believing that he could resolve the issue without involving law enforcement. These attempts at negotiation with Mr. McGee persisted through the end of 2023, but Mr. McGee refused to cease his actions.

~2024~

• January 11, 2024 – On Thursday, January 11, 2024, with the help of a Coop Law firm and community partners, a plan was drafted to dissolve the cooperative, and it was sent to Mr. McGee’s attorney. Three days later, the Bike Shop was burglarized.

• January 13, 2024 – Four days after Najari Smith’s 45th birthday, Mr. Smith entered the Bike Shop to find 75% of floor inventory gone, floor display cases once filled with lights and other bike accessories emptied of all merchandise, all bike tube inventory in the storage cabinet in the back of the shop gone, along with all backroom inventory and everything that was displayed on the walls. Bike rack displays were disassembled and staged by the front door (as if there was a thwarted or interrupted attempt to take these as well). The Bike Shop safe was emptied of all cash and left sitting open.
  • The alarm was deactivated.
  • The cameras were turned off and disconnected. 
  • There was no sign of forced entry. 
  • This massive theft had to have been done by someone who knew where the cameras were, had the code to the safe, and had the keys to the front door. 
  • Najari Smith immediately called and reported the theft (presumed burglary) to the Richmond Police Department (RPD).

• January – July 2024 – Over the next months, while RPD was investigating the burglary,  they received financial records, evidence that Mr. McGee transferred POS sales to his personal bank account and evidence that Mr. McGee continued to sell items from the bike shop through his personal Shopify website (https://www.rcrbs.com/),. Mr. McGee’s website featured bikes belonging to the cooperatively owned bike shop. Some of the photos featured on the website were of items that were photographed in the bike shop and were stolen during the “burglary” (now referred with the corrected term of  “embezzlement” by RPD) and now were offered for sale on Mr. McGee’s website: 

• Here are a few links still live on the website as of 7/29/24:
  • e-Bikes: https://www.rcrbs.com/collections/e-bike
  • Kids Bikes: https://www.rcrbs.com/collections/kids-bike
  • Bikes Parts: https://www.rcrbs.com/collections/parts-1/parts
  • Bikes Repair Tools: https://www.rcrbs.com/collections/tools-1
  • Bikes https://www.rcrbs.com/collections/bikes-1

•  Mr. McGee’s website features pictures that were taken inside the Bike Shop of merchandise that was later stolen from the shop.  

• During an update meeting with the RPD, police detectives told Najari Smith that technically, because this theft looked like it was done by co-owner, Roshni Felonte (Taye) McGee, the crime was now being investigated as “embezzlement,” not burglary, as co-owner cannot technically burglarize their co-owned business. 

In addition to the individual acts of embezzlement described above, Mr. McGee appears to have acted with the support of others who appear to have more political motivations.

• With the help of former Richmond Mayor Tom Butt and his sons, Daniel and Andrew Butt, Mr. McGee has covered up these and other crimes that are still under investigation by RPD, as well as Mr. McGee’s other misdeeds and broken contracts that will also come to light as investigations unfold. 

• The Butt’s and their followers, like former Richmond City Council contender Oscar Garcia, have no interest in the truth, only in how they can spin information in a self-interested effort to use this painful situation to mount a baseless political attack against Councilmember Robinson (Mr. Smith’s spouse).

• We have learned the very hard way that not everyone is trustworthy. As the full story continues to unfold, perhaps the Butt family and their followers, who have unfortunately allied themselves with untrustworthy parties, will learn this hard lesson as well.

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At this point, after all of the heartache, we are unsure of whether or not we will bring the Bike Shop back. We realize what a beautiful role the shop played for over 10 years in the social and cultural life of downtown Richmond. But these wounds are still fresh. Maybe with time and new energy we can return to the solid business plan the bike shop had before it went astray and bring bikes back to Richmond again.