Beach Gallery Owner Hired Convicted Sex Offenders To Work At Bar

KEANSBURG, NJ — The permanently closed Beach Gallery bar/restaurant in Keansburg remains under a state investigation by the New Jersey Division of Alcoholic Beverage Control (ABC).

It came to light last week that three men who managed the bar previously pleaded guilty to sex crimes against children; one case involved boys as young as 12. Those three men are Beach Gallery's director of operations John Schulte, general manager Michael Palacios and Derick Jerinsky.

All three were previously convicted of sex crimes against minors, and did prison time, according to court records.

The town of Keansburg shut down Beach Gallery on Sept. 30. The ABC launched its investigation around that same time.

The liquor license for Beach Gallery is owned by Janna Epstein-Jerinsky, the bar's owner and wife of Derick Jerinsky. She told NJ101.5 last week her husband was not involved in running the business, but a former Beach Gallery waitress said he was often on site, and that he told bar staff he was the owner.

Also, Jerinsky is listed as the registered agent for an LLC application he and his wife filed with the state to open Beach Gallery; she is listed as a manager. In that application, the husband-wife said the restaurant would be called The Brunch Gallery and said: "brunch, rooftop bar, events and local art merge at our restaurant, creating a delightful experience in one captivating space."

Jerinsky pleaded guilty in 2011 to showing obscene material to a minor and child endangerment, and he served three years in prison, according to New Jersey court records. Jerinsky, 27 at the time, was a certified music teacher and he was volunteering as an assistant band instructor at Ramsey High School in Bergen County. While working with the high school band, Jerinsky had sexual contact with one underage female student and showed obscene sexual images to other underage teenage girls, according to the Bergen County prosecutor. In 2012, this order from the NJ Department of Education shows his music teacher certificate was permanently revoked, and he is not allowed to hold public school employment in the state of New Jersey.

Schulte, 49, is a registered Tier-2 repetitive compulsive sex offender, according to the NJ Sex Offender Registry database. He was convicted in 2005 on two counts of sex assault; prosecutors say he sexually assaulted three boys ages 12 - 13 in Union County.

And in 2018, Palacios pleaded guilty to failing to register as a sex offender, according to New Jersey court records. This photo of him on Mugshots.com showed he pleaded guilty to one count of sex assault against a victim ages 13-16.

"Under New Jersey Alcoholic Beverage Control Law, persons convicted of a crime involving moral turpitude are unable to have any interest in or BE EMPLOYED BY AN A.B.C. LICENSEE," ABC regulations state here on page 28. "Generally, crimes involving moral turpitude are those deemed serious by society."

The website for the Beach Gallery has since been taken down. However, last week Beach Gallery said it was asked by the state to hire ex-convicts. They also said the state of New Jersey had to approve the hiring of all employees who were on probation/parole, and the bar also said it never asked about employees' criminal records when hiring.

Beach Gallery said when it first opened it "was contacted by a state agency asking if we would be willing to hire individuals with criminal backgrounds, as the state was facing difficulty in placing them in employment," the bar said. "We readily agreed to participate, not only because it aligns with our core mission but also because we believe in supporting the state’s efforts to reduce recidivism through employment."

Beach Gallery never named that state agency.

1 percent of liquor license owned by Epstein-Jerinsky, 99 percent owned by Keansburg businessman Ritesh Shah and partners

Epstein-Jerinsky owns 1 percent of the liquor license; the other 99 percent of the license is owned by RDS Bar and Restaurant, LLC, said Keansburg Mayor George Hoff. This was confirmed by the Division of Alcoholic Beverage Control.

Epstein-Jerinsky paid a fee to RDS to use 1 percent of the license, and she opened and operated the bar under that 1 percent of the license she owned, said the mayor.

RDS Bar and Restaurant, LLC is owned by Ritesh Shah, a pharmacist and local Keansburg businessman, plus three other partners. Shah and his partners also own the three-story building that housed Beach Gallery, at 260-262 Beachway Avenue. The liquor license is attached to that building, confirmed Shah.

After this article was published, Shah stressed to Patch that, as one of the building's owners, he had nothing to do with the operation of the restaurant.

"They were responsible for the operation of the restaurant. I had nothing to do with it," said Shah. "I was a silent partner. I am an investor in this town and it is so unfortunate I trusted these people and look what came back to me. We just found out they have not paid their water bill; they have not paid their JCP&L bill. People were not getting their salary. And as the landlord, I am responsible."

260 Beachway Ave. used to be Stadium bar, which was torn down. The new, three-story building that housed Beach Gallery was built in its place.

In this 2018 article in the Two River Times (which listed Shah as one of the building's owners), Shah said he planned to open the building as a waterfront restaurant overlooking Raritan Bay, to be called Pier 260 Rooftop Bar and Restaurant.

Shah owns five pharmacies across Monmouth County (in Holmdel, Howell and elsewhere). He used to own Drugsmart Pharmacy at 300 Main Street in Keansburg, but said he no longer owns it. He still owns the building that houses it.

Shah has also gotten into the marijuana business: He is a co-owner of Monmouth Wellness and Healing, LLC, which operates NJ Leaf retail cannabis dispensary at 546 Park Avenue in Freehold borough. Shah also plans to open a marijuana dispensary on Rt. 36 in Keansburg. He said he just got the license from the state a week ago, and hopes to open by the end of November.

Shah also owns Ritesh Shah Charitable Pharmacy in Red Bank, which serves the underinsured and uninsured. (Keansburg borough manager, who is the former Keansburg Police Chief, Raymond O'Hare sits on the board of Shah's charitable pharmacy.)

Last week: Beach Gallery Bar Says State Asked Them To Hire Ex-Cons, Will Permanently Close (Oct. 2)

Keansburg Restaurant Steps Up To Host 2 Weddings After Beach Gallery Suddenly Closed (Oct. 3)

Editor's note: This article has been updated with new information after it was originally published.