PROVIDENCE, R.I. — Giovanni "John" Feroce, the high-flying entrepreneur now floating his name for governor, is in deep financial trouble.

Just a few years ago, the West Warwick native basked in national attention, touting his work as chief executive officer at Alex and Ani.

Then, in March 2014, he was abruptly ousted from the multimillion-dollar Cranston jewelry company. Within a few months, he said he had big plans.

Feroce bought BENRUS, a military-style watch brand, and promised to create a global billion-dollar fashion brand.

He also launched a semipro basketball team, took over a local advertorial magazine, started an investment firm, bankrolled local musicians, invested in a Florida nightclub, sponsored a golf tournament and was featured in a pitch for a business-reality TV show, calling himself "The Fixer."

Today, Feroce’s empire is circled by creditors.

Former employees, the IRS, the City of Newport and a handful of vendors have filed liens and lawsuits.

The nightclub went bankrupt, the magazine folded and BENRUS needs new capital. His Newport mansion is leveraged to the hilt, and his few remaining employees are paid only in shares.

Personally, he says he feels betrayed by those who've left and filed lawsuits. He calls them "disloyal" and "weak."

"I get extremely offended by anybody who [expletive] questions me. OK? Because I do nothing but put me, my family, my children, all of us, on the line to help the state of Rhode Island," Feroce said during a lengthy interview in mid-December at his headquarters in Fox Point, the site of his only remaining BENRUS store.

Feroce, 48, was a military officer, and a Rhode Island state senator for two years in the 1990s. He later ran for lieutenant governor and then, after moving to Delaware, ran for state Senate there in 2006. After starting out with his brother in his optical center in 1991, Feroce went on to launch College Optical centers.

Then came Alex and Ani.

At a University of Rhode Island reunion in 2009, Feroce met owner and designer Carolyn Rafaelian. He ended up heading her jewelry company.

In Feroce's few short years there, Alex and Ani grew from 23 people and $4.5 million in annual revenue to nearly 1,100 employees and annual revenue of $230 million by 2013, according to figures he released at the time.

The bangles and charms were a hot commodity, and so was Feroce, a retired Army Reservist who gave speeches comparing business to a battlefield, with promises to "resurrect Main Street" with Alex and Ani retail stores. Feroce and Rafaelian became national names, catching light for their company's meteoric rise.

In 2013, he and Rafaelian were awarded honorary doctorates in business from URI.

Then, the charm wore off.

Feroce left in March 2014. He says he can’t talk about the settlement, but Newport land records indicate Alex and Ani paid off $7 million on his Newport mansion.

He started GF Asset Management, which then bought a majority ownership stake in BENRUS on a handshake deal on July 1, 2014, with New York businessman Bernie Mermelstein, head of M.Z. Berger & Co.

BENRUS was best known during World War II as a watch supplier for the U.S. Armed Services. Feroce says he invested $3.5 million before signing a contract eight months later.

Some of the merchandise was available in retail stores. But Feroce envisioned turning BENRUS into a lifestyle brand, going beyond backpacks and watches to clothing and even a cologne he called Black Ops.

He launched a major marketing campaign before opening a single BENRUS store.

When the owner of RI Local, a struggling, family-owned advertorial magazine for Rhode Island businesses, approached him for help, Feroce took over the magazine and placed some BENRUS ads.

That fall, Feroce launched the Providence Sky Chiefs semipro basketball team, named for a BENRUS watch model.

"When we're in San Diego, when we're in Syracuse, when we're down in Texas, or up in New Jersey ... everyone's going to hear Sky Chief, Sky Chief, Sky Chief," Feroce said, holding a watch in his hands at the October 2014 news conference announcing the new team. "And I'm going to be selling Sky Chiefs, Sky Chiefs, Sky Chiefs, hopefully."

He placed BENRUS ads at TD Garden in Boston, the Dallas Cowboys' AT&T Stadium, the University of Rhode Island's Ryan Center and the Rhode Island Convention Center. He also paid for BENRUS to be the "official timepiece" of the Buffalo Bills; two large BENRUS clocks were installed at the stadium in Orchard Park, New York.

He started GF Entertainment and invested in local musicians, paying their living expenses, studio time and lessons. For one, he paid to produce a song and music video featuring Nuno Bettencourt, the lead guitarist of the rock band Extreme (shown below). Feroce had a cameo — sitting on the deck of his Newport mansion. He also embarked on a million-dollar renovation of the house.

Along with the mansion and an apartment in downtown Providence, he leased a bright blue $137,000 BMW i8 — license plate "BENRUS" — and hired drivers. He occasionally flew in a helicopter. He spent thousands on a marketing company.

Feroce said he wanted to open stores in 2015 in Rochester, New York, Charleston, South Carolina, Washington, D.C., and Nantucket, Massachusetts. All of the locations he chose were near Alex and Ani stores.

At its peak, Feroce estimated, he was employing 40 to 50 people. He planned for 100 employees after the first year.

He said he sees himself as Rhode Island's celebrity CEO, akin to Donald Trump and Sir Richard Branson. He was splashed across the pages of The New York Times and WWD magazine and profiled by Bloomberg. And by 2014, his character was so big that a local production company pitched him as a business-reality TV star: "The Fixer."

In the short promo video, Feroce says, "There is no one, zero, who has more experience than me in this [expletive] world. Period. OK? You find that guy."

"People call me The Fixer. I fix problems. I fix situations. I don't panic. And that's why I'm successful, because I am unafraid. I make decisions. Statistically, I know I'll get a couple wrong. I don't care. I operate at battlefield speed."

Feroce soon had a situation of his own.

"By the end of 2014, he was leveraged up the wazoo," said Feroce's former business manager, Thomas McGovern.

BENRUS was bleeding cash. The monthly budget was $500,000 and the cash coming in was less than $20,000, said McGovern.

Around the country, Feroce's dream of building a network of BENRUS stores pushed him deeper into debt.

The man who gave speeches about "resurrecting Main Street" says he's breaking $4 million in leases. He confirmed spending $650,000 on renovations for an apartment in Charleston and a store that never opened. Neither did a store in a mall in Washington, D.C., where he said he is walking away from a $125,000 broker's fee.

The store in Rochester lasted more than a year, Nantucket store only a few months.

The Sky Chiefs lost $277,000 in the first year, McGovern said. The team didn’t have worker's compensation insurance when one of its players injured his knee in mid-February. The Sky Chiefs purchased it after the injury, but not for the second year. Feroce said the Sky Chiefs ultimately "burned through a half-million dollars."

In May 2015, the owners of the Sip Lounge in St. Petersburg, Florida, filed for Chapter 11 bankruptcy. Feroce was listed as the largest creditor, owed about $530,000.

A BENRUS-sponsored golf tournament, open to professionals, at The Preserve in Richmond, in June 2015, cost him half a million dollars, McGovern said.

RI Local magazine was drained of $130,000 in July and August 2015, McGovern said. He said Feroce used the money for other debts; Feroce said he was paying back his loan to RI Local.

The magazine shut down.

Checks were bouncing, and people were getting paid out of different accounts, when they were paid at all, according to lawsuits and multiple interviews with former employees and vendors. Some began filing claims at the state Department of Labor and Training that they were owed unpaid wages. In 2015, McGovern claimed he was owed $4,807, and RI Local Media employee Jenn Lombari filed for $3,404. Feroce paid both, according to the DLT.

More would follow.

Feroce was taking out lines of credit on the Newport mansion, and by the fall of 2015, he had put the mansion and adjoining lots on the market for more than $12 million.

Around that time, Feroce says, he called a "town hall" meeting with BENRUS employees to tell them that he would be paying them in shares, not money. In addition, he says, he offered "gifts" of cash.

"You don't find guys as generous as me. It's impossible, even," he said later.

People quit.

After the Providence Sky Chiefs started their second season in early 2016, their pay also slowed, then stopped, according to several players. Feroce acknowledged that he still owes players money. He says he'll get to it when he can.

The new year, 2016, brought liens and lawsuits.

* Former BENRUS store employee Lindsey Hakanson sued Feroce and BENRUS LLC in December 2015 in U.S. District Court, South Carolina, for $33,000 in unpaid wages, $5,538 in lost wages and $5,538 in liquidated damages. The case was dismissed without prejudice in July, meaning it could be reopened if no settlement was reached in 60 days. The case was not reopened.

* Three former employees filed complaints with the DLT in February 2016. Sky Chiefs general manager Antonio Lopes said he was owed $15,477, Sky Chiefs marketing director Deb Weinreich said she was owed $64,426 and RI Local graphic designer Kelly Meyer said she was owed $10,725. All three complaints were settled after a hearing in July; the details are confidential.

* The landlord of BENRUS' Nantucket store, NIR Retail, sued Feroce and BENRUS LLC on Aug. 30 in Superior Court, Providence, for $81,070, plus costs and interests. Judge Richard Licht issued an order Tuesday temporarily restraining Feroce from transferring his Newport property. A breach of contract hearing is scheduled for Wednesday.

* Cleantech Services Inc. sued BENRUS on Sept. 16 in 6th District Court, Providence, for $6,113. The case went to a default judgment in October, but the money hasn't been paid. The unnamed manager of BENRUS was ordered to bring all corporate and financial records to court on Feb. 3.

* Rachael Kashgagian, former BENRUS director of sales, filed suit Dec. 12 in Superior Court, Providence, against Feroce, BENRUS LLC, GF Asset Management LLC, Chief Financial Officer Richard W. Nicholson and Human Resources Director Madison Malloy. Kashgagian claims she went without pay for nearly a year. Her lawsuit says Feroce commingled his corporate and personal accounts, and drained the companies' resources. She quit in September and is seeking unpaid wages and other costs.

* Emily S. Shaw, a former BENRUS designer, filed suit Dec. 15 in Superior Court, Providence, against Feroce, BENRUS LLC, GF Asset Management LLC, and Nicholson. Shaw is seeking unpaid wages and a severance package that she said was promised. She, too, says Feroce was using corporate money for his personal use and commingled accounts.

* Broder Brothers Company, a clothing supplier, sued Feroce in Superior Court, Providence, on Dec. 21, alleging that Feroce owes $7,216.

Feroce said he expects more lawsuits after this article is published. He disputes the allegations lodged by his former employees. He shrugs them off: "One guy told me if you're not getting sued, you're not in the big leagues."

* During an interview, he showed a reporter an email from Brown University sent in October threatening to go to a collection agency to get the thousands owed for hosting Sky Chiefs games in 2015. "I'm keeping them in the loop," Feroce said.

* Feroce's Newport mansion and its lots are a tangle of loans and liens. When he didn't pay his property taxes, the tax lien was sold in August. He paid it off with an $82,000 check in September, but now owes $35,000 for 2016 property taxes.

*The state Department of Labor and Training filed two liens against Feroce's mansion in June 2016 because one or more of his companies owes unemployment insurance. A DLT spokesman said the liens were still in effect and the accounts remained delinquent in late December.

After questions from The Providence Journal, the DLT is reviewing whether the Sky Chiefs should have had worker's compensation coverage for their employees.

* Feroce's largest creditor is the Internal Revenue Service, which in January 2016 filed a total of $3.2 million in personal income tax liens against Feroce's mansion. The income taxes are from 2013 and 2014, Feroce's last years at Alex and Ani.

Feroce said in December that he was paying off the IRS liens by reporting nearly $2 million in BENRUS losses and more than $1 million in unspecified amendments to his income tax returns from the Alex and Ani years.

He and his accountant say the IRS now owes him $70,000, though Feroce declined to release his tax returns to document that claim. (The City of Newport said the IRS liens remained on the property as of Dec. 30.)

Asked whether he had spent all of the money from Alex and Ani, Feroce replied that he couldn't talk about the settlement, but that the assertion "wouldn't be wrong."

He added: "I am all in."

Feroce blames his financial problems on a bad deal with Bernie Mermelstein and Mermelstein's company M.Z. Berger, which held the license to BENRUS products and retained 25-percent control of the company, transferring 75 percent to Feroce. Last week, Feroce, through BENRUS and GF Asset Management, filed a lawsuit in Delaware Court of Chancery against Mermelstein, M.Z. Berger and B-Man 1 LLC.

Feroce is accusing them of breach of contract, fraud and negligent misrepresentation. Feroce also claims that all the "media buzz" that he created about BENRUS doubled the back-to-school sales, which led to more than $1 million in additional revenue. However, Feroce says, Mermelstein, M.Z. Berger and B-Man 1 concealed the revenue from him.

Feroce said he invested $3.5 million on a handshake deal, before signing a contract eight months later. Then, as he continued investing millions into BENRUS, he didn't get the revenue or the deal he wanted. And, he said, the watches made overseas were substandard.

(The company and Mermelstein did not respond to calls and emails over several weeks requesting comment for this article.)

That’s why, Feroce said, he ran out of money and leveraged his mansion to cover the losses.

It’s why he says he didn’t pay his property taxes or income taxes — knowing, too, that the losses from his company could be used to wipe out the bulk of a growing tax bill.

Reporter: Why did you put money in when you didn't have a contract?

Feroce: Because I’m smarter than most guys.

Reporter: No offense, but that doesn't sound very smart.

Feroce: To the lay person, it wouldn’t. But to a complex individual …. A handshake agreement is just as good as a written agreement.

Reporter: But now you're having trouble with your mansion and your other companies.

Feroce: Who cares? I'm a risk taker.

And what about the future?

He talks about running for governor as a Republican. "I do think I could win, if I ran," he said. "Because I have more experience than anyone. And, this state needs someone who can think big."

And this "mess," as Feroce calls BENRUS, could be fixed in a few months. He believes the company will be worth more than $1billion in five years. "If you are an early investor … you will make boatloads of money when I execute," he said.

Despite the last two and a half years, Feroce says he has the formula to build a billion-dollar brand. Even as he's seeking investors, he is liquidating his own assets and lending BENRUS money to stay afloat. He says online shopping is the future. He is confident he will succeed.

"I am an unbelievable entrepreneur ... I put in over 7 [million] at this point," Feroce said. "And on top of that, I’m always successful. So, it’d be crazy not to want to be on my good side."

Feroce says he has new design samples of watches and plans to launch new products in the second quarter of 2017. He showed Journal reporters a business plan he's shopping to investors.

"It’s a good bet because it’s a real brand," Feroce said of BENRUS. Look at "what I’ve invested in the company, the development of the watches, the design and process — and, frankly, me. I’m the most valuable part of the process."

Governor? While making "hundreds of millions of dollars"?

The dilemma, he said, is, "Can I do both?"

CORRECTION: The June 2015 BENRUS-sponsored golf tournament was at The Preserve in Richmond, Rhode Island. An earlier version of this story misidentified the location.

CORRECTIONS:

Because of a clerical error now acknowledged by Superior Court, the original version of this story inaccurately called one of the law suits against Giovanni Feroce a receivership proceeding. Also, in a letter to The Journal, Feroce said Thomas McGovern was his business manager, not his chief operating officer; his company, BENRUS, did not lose a half of a million dollars on a golf tournament because he sponsored the event for “marketing and advertising exposure;” and that a BENRUS store in Rochester was open more than a year, not only a few months. The original version of the story inaccurately said Feroce believes his company will be worth $100 million in five years – not $1 billion-- and that he met Alex & Ani owner Carolyn Rafaelian at a URI reunion in 2009, not 2010.

With reports from staff writer Patrick Anderson

- amilkovi@providencejournal.com

(401) 277-7213

On Twitter @AmandaMilkovits