Wake pizzeria owners cut feds out of tax pie
Posted July 16, 2014
Raleigh, N.C. — A father and son who own Wake County pizzerias pleaded guilty Tuesday to filing false tax returns, authorities said.
Federal investigators said Thair Alwan and his son, Saill Fadhil, skimmed about $1.3 million in profits from their I Love NY Pizza shops in 2008 and 2009 and filed tax returns for the businesses that under-reported the actual income, resulting in "substantial tax underpayments."
According to court documents and statements made in court, I Love NY Pizza had two shops in Raleigh and one store location in Knightdale by 2008, and an Apex shop was added in 2009. Although employees stated that the business was at least 40 percent cash sales, cash deposits into the corporate bank account, as a percentage of total deposits, were 1.3 percent in 2008 and 2.3 percent in 2009, authorities said.
The skimmed money was used for personal expenditures or deposited into Alwan's or Fadhil's personal bank accounts, authorities said.
Investigators said that, between 2007 and 2010, Alwan made 73 currency deposits into his personal accounts. Of those, 50 were at least $9,000, and the majority of these were in the amount of $9,980. None of the deposits was more than $10,000, a level at which banks file a report with the Internal Revenue Service.
The father and son have agreed to pay restitution to the IRS. When they are sentenced, they face up to three years in prison and a $250,000 fine.