LANSING (WWJ) – An Oakland County business has pleaded guilty to 64 felony charges in connection with tax fraud and embezzlement at a sushi restaurant.
The Michigan Attorney General’s Office says the owners of Sushi Samurai on Orchard Lake Road in West Bloomfield took sales tax paid by customers, but didn’t report it.
As part of the plea, Sushi Samurai Inc. will have to pay nearly $1 million in restitution, including $274,378.52 in income taxes, penalty and interest and $706,101.07 in sales tax, penalty and interest.
The company, along with its owner Christina and Doug Hyun Chang of Orchard Lake, was charged last spring after a joint investigation by the Department of Attorney General and the Department of Treasury into whether the restaurant was using an illegal Point of Sale (POS) sales suppression software.
During the investigation, it was determined that the sales in Sushi Samurai’s records were significantly higher than those reported to the state. The “zapper” software essentially deletes sales from the Point of Sale records. It was determined that thousands of sales receipts had been deleted.
Further investigation allegedly found, in total, the Changs via their business embezzled over $170,000 in sales tax receipts alone. In addition, over $2.5 million in sales were allegedly never reported or accounted for in income tax filings between 2012-2016. The Changs allegedly used the cash for business and personal expenses.
“This business knowingly cheated the law for their own personal gain,” said AG Bill Schuette in a statement. “This case is a result of a collaboration between the Department of Attorney General and Department of Treasury and I want to thank everyone involved for their hard work in stopping this illegal activity to resolve this case.”
This does not wrap up the case for the Changs, however. As the plea entered Thursday in the 6th Circuit Court relates specifically to Sushi Samurai Inc., owners Dong Hyun, 46, and Christina Chang, 51, still themselves face felony embezzlement, conspiracy and tax fraud charges that could land them in prison for more than 20 years.
Sentencing for the restaurant company was set for November 30.
It’s unclear at this time if the couple will also take a plea or of this case will go to trial.