Maybe Mark Melchiori’s big mistake was picking the wrong guy to rip off. It’s not clear who the right person might have been, but in hindsight, it most definitely was not Hollywood director Robert Zemeckis, famous for such blockbusters as Forrest Gump and Back to the Future.
Halfway into an $8 million home addition job on Zemeckis’s Montecito estate, the movie director got wind that Melchiori, then running one of Santa Barbara’s flagship construction companies, had not paid any of the subcontractors. At that time — it was June 2012 — Zemeckis had just written Melchiori a check for $350,000.
As Zemeckis would testify in Judge James Herman’s courtroom last week, he called Melchiori “hundreds of times,” demanding an explanation. Not once, he claimed, did he ever get a call back. “He disappeared like a thief into the night,” Zemeckis testified.
To find out where his money went, Zemeckis hired a private investigator. What the investigator discovered would provide the basis for a 47-count criminal indictment filed against Melchiori by the Santa Barbara County District Attorney’s office. Rather than go to trial and risk a 50-year sentence, Melchiori opted to plead guilty to three counts late last year.
After an emotionally searing hearing last Thursday, Judge Herman imposed the maximum sentence possible. Courthouse bailiffs then put Melchiori in handcuffs, removed his necktie, and marched him into a nine-year, four-month sentence in state prison.
Although Melchiori had submitted a written apology expressing regret and remorse, he chose not to address the judge directly or his many accusers who showed up in court. Likewise, none of the people who wrote letters on Melchiori’s behalf did either.
In opting for the maximum, Judge Herman dismissed entreaties by Melchiori’s attorney, Doug Hayes, for a lighter sentence. Hayes argued for probation, pointing out his client had no prior criminal history and had been deemed a low risk for further offense. Further, he argued, Melchiori’s life had already been ruined: He lost his business, was divorced by his wife, and had disgraced his family’s good name.
“This was not an accident,” Herman found. “It was not just a one-off. It was conducted over a number of years.” The many schemes Melchiori devised, Herman concluded, were “so sophisticated that it took multiple investigations by several different agencies to uncover the extent of the defendant’s criminality.”
Herman cited the severity of the impact in handing down his sentence, noting that Zemeckis wound up $1 million out of pocket because of Melchiori. In addition, countless employees of Melchiori Construction lost their jobs and had their retirement accounts wiped out when the company went bankrupt shortly after Zemeckis blew the whistle. And Melchiori’s business partners found themselves sued by banks and bonding companies to the tune of $12 million for debts Melchiori incurred in the company’s name. It got so bad, said one, that he became afraid to answer his door for fear of encountering a process server on the other side.
The extent of the restitution owed remains uncertain. Based on statements made in court, it appears Melchiori spent $10 million in company assets over a four-year period. That money was used, according to prosecuting attorney Casey Nelson, to support “a lavish lifestyle” that included buying Melchiori a new Porsche and throwing his daughter a sweet-16 birthday bash at The Ritz-Carlton Bacara and giving her a new car. “It’s important to send a signal to the community that economic crime will not be tolerated just because it’s economic crime,” said Herman.
For many years, Melchiori Construction signs adorned some of the biggest and most expensive construction projects on the South Coast: the Four Seasons Biltmore, San Ysidro Ranch, UCSB, and the Canary Hotel, to name a few. The company was started in 1990 by Melchiori’s father, Ugo Melchiori, an Italian immigrant who moved to Santa Barbara in 1958 and started his first construction company in 1972. Ugo Melchiori would come to enjoy a respect bordering on reverence within Santa Barbara’s construction universe, as well as its close-knit Italian community. When he died in 2009 from an especially aggressive form of cancer, it gave rise within those worlds for much grief.
Mark Melchiori had worked for his father’s first company as a kid and started working for Melchiori Construction in 1993 after getting a business degree. By 1997, he was running the show. According to former business partners who testified in court, the younger Melchiori quickly became “arrogant and narcissistic,” buying fancy houses and cars. Initially, they were told, Melchiori’s wife was a trust-fund baby. Later, they claimed, they would discover Melchiori was tapping the company’s revenues to sustain an unsustainable lifestyle.
Melchiori’s now ex-wife, they claimed, hired two personal assistants at company expense to take care of parental volunteer obligations at Bishop Diego, where their daughter attended. One former partner, Oliviero Ziliotto, claimed he heard that daughter be instructed by Melchiori’s ex-wife to run him over. He also claimed that Melchiori kept a 9mm Beretta on his office desk and a shotgun slung up against the office wall.
In court, Melchiori’s attorney, Hayes, would argue, “It’s only money.” In written pleadings, he was more compelling. Melchiori, he argued, found himself forced “to rob Peter to pay Paul” to keep the company afloat in response to the economic crash of 2008. Making matters worse was a $6 million legal judgement he could not collect on from developer Don Hughes, because Hughes — who referred to Melchiori as “that wop bastard” — declared bankruptcy. On top of that was his father’s death.
Melchiori, Hayes argued, leveraged himself to the maximum extent possible not to support a lavish lifestyle but to keep the company going. When his wife divorced him, he insisted she sell her wedding ring so he could deposit the proceeds — $90,000 — into company coffers. Melchiori would tell evaluators with County Probation he “should have been more diligent,” but said he was “baffled” that any of his conduct constituted a criminal offense.
In recent years, Melchiori has lived in Gilroy, where he rents a room. He makes $9,200 a month working for a construction company that specializes in hotel work. His current boss knows his legal history and wrote a strong letter of support. So, too, did Santa Barbara philanthropist Anne Towbes, who wrote warmly of Melchiori that he arranged the first date between her and developer and banker Michael Towbes, with whom she spent 12 happy years until his death.
Defense attorney Hayes argued Melchiori would not be able to make restitution to his victims if he were locked up. Prosecutor Nelson mocked the idea that Melchiori had any sincere interest in restitution. To date, he argued, Melchiori had only paid $640 into a restitution fund — established only in recent months — despite earning “a six-figure salary.”
Zemeckis was likewise skeptical, describing Melchiori as “unrepentant, privileged, and arrogant,” adding, “the guy is a complete piece of shit, like a sociopath.”