US Attorney: Nifty Fifty's owners cheated IRS, 5 charged
PHILADELPHIA - May 16, 2012 (WPVI) -- The five owners and managers of the Nifty Fifty's restaurant chain have been charged with cheating the IRS out of millions of dollars, the U.S. Attorney's office announced on Wednesday.
Robert Mattei, 73, of Delray Beach, Florida; Leo McGlynn, 52, of Swarthmore, Pa.; Brian Welsh, 48, of Springfield, Pa.; Joseph Donnelly, 49, of Springfield, Pa.; and Elena Ruiz, 46, of Drexel Hill, PA were charged in connection with an alleged tax evasion conspiracy.
U.S. Attorney Zane Memeger said the five cheated the Internal Revenue Service by failing to properly account for more than $15 million in gross receipts, thereby evading $2.2 million in federal employment and personal taxes.
Through their attorney, the owners issued a statement saying:
"We deeply regret our misconduct and accept full and complete responsibility for our actions. We have been fully cooperative with the IRS to resolve these issues and have repaid all back taxes and penalties. We will continue to run each of our five restaurants in full compliance with the law.
We wish to thank all of our employees, friends, and business partners for their continued support as we move forward. Because this matter is still in the court system, we can have no further comment on this matter at this time."
Memeger called it a long-running scheme to avoid paying millions of dollars in personal and employment taxes as related to their restaurant chain. The statement said the defendants have evaded paying taxes since the restaurant was established in 1986.
Memeger said the five are accused of not only evading paying the taxes they owed, they allegedly filed income tax returns claiming they were due refunds based on the erroneous reporting of their incomes.
If convicted, Mattei and Welsh face a maximum sentence of 40 years of imprisonment, five years of supervised release, a fine of up to $1.5 million, full restitution to the IRS, and a $300 special assessment. If convicted, McGlynn and Donnelly face a maximum sentence of 50 years of imprisonment, five years of supervised release, a fine of up to $2 million, full restitution to the IRS, and a $400 special assessment. If convicted, Ruiz faces a maximum sentence of ten years of imprisonment, three years of supervised release, a fine of up to $500,000, full restitution to the IRS, and a $200 special assessment.
pennsylvania, taxes, irs, local/state
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