Thursday, July 16, 2015

Detroit Pizza King Sentenced to Prison for Tax Fraud

Happy Asker hales from West Bloomfield but started his pizza empire right here in the Motor City. Unhappy Asker was sentenced to 50-months prison last week in Detroit in the United States District Court for the Eastern District of Michigan.

Asker was sentenced by Judge Denise Paige Hood following a 10-day jury trial last November where he was accused of filing false tax returns and under-reporting employee income.  Evidence adduced at Asker's trial revealed conspiracy among several pizza franchise owners and two sets of books. Also part of Asker's judgment of sentence was a hefty $2.5 million fine.

The FBI's official web site summarizes the case against the Chaldean pizza mogul:
Evidence at trial established that from 2004 through 2011, Asker, along with certain franchise owners and employees, executed a systematic and pervasive tax fraud scheme to defraud the IRS. Gross sales and payroll amounts were substantially underreported on numerous corporate income tax returns and payroll tax returns filed for nearly all 60 Happy’s Pizza franchise locations. From 2008 to 2010, Asker and his co-conspirators diverted for personal use more than $6.1 million in cash gross receipts from approximately 35 different Happy’s Pizza stores in the Detroit area, Illinois and Ohio. In total, Asker and certain employees and franchise owners failed to report approximately $3.84 million of gross income and approximately $2.39 million in payroll taxes from the various Happy’s Pizza franchises to the IRS. A portion of the unreported income was shared among most of the franchise owners, including Asker, in a weekly cash “profit split.” As a result of the scheme, the IRS is owed more than $6.2 million in income and employment taxes. The evidence also established that Asker intentionally misled IRS-Criminal Investigation special agents during voluntary interviews conducted with him in 2010.
The IRS catches only a fraction of such transgressors. If business owners paid their fair share of taxes and stopped letting greed influence their conduct, then a level playing field is maintained for all businesses.

As a law firm owner filing a Schedule C every year, this blogger certainly does not appreciate the tax cheat. Asker's transgression makes the dollars I dutifully pay to the IRS every quarter throughout the year seem ill-spent, but I will continue paying just the same.

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