WEST HARTFORD, Conn. — The part owner of several restaurants in Connecticut was sentenced to prison for operating an extensive tax fraud scheme that involved Connecticut and Massachusetts restaurants that he operated.
William Chen, 49, of West Hartford was sentenced to 18 months of prison followed by a year of supervised release.
According to court documents, Chen was a part owner of several restaurants, including Ginza Japanese Restaurant in Bloomfield, Ginza Japanese Cuisine in Wethersfield, Kaliubon Ramen in Wethersfield and West Hartford, and Feng Asian Bistro in Hartford and Canton, and Millbury, Massachusetts.
Chen was responsible for purchasing and using the point of sale system for restaurant orders, and for training staff on the use of the POS system.
Chan allegedly paid an addition fee to activate a "zapper" software, which is designed to delete transactions from the point of sale system to create fraudulent sale records.
From 2013 to 2020, Chen and others staff members deleted cash transactions to reduce the gross receipts and the amount of sales tax collected reported by the system. Chen intentionally suppressed the restaurants’ taxable income that he disclosed to his accountant.
For the 2013 through 2020 tax years, Chen failed to withhold, account for, and pay to the IRS federal income taxes, Federal Insurance Contributions Act taxes (“FICA”), and federal unemployment taxes for multiple employees that he paid, or that he knew were paid, in cash.
Officials said the tax loss amounted to $2,092,926.94. Chen has paid $600,000 in restitution so far.
Chen pleaded guilty to two counts of filing a false tax return on July 29, 2022. Chen is required to report to prison on April 5.
Jareliz Diaz is a digital content producer at FOX61 News. She can be reached at jdiaz@fox61.com
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