Auburn Hills Restaurant, Owners Face Felony Charges For Underreporting Sales, Failing To File Tax Returns

click to expand

(CBS DETROIT) -- An Auburn Hills diner and its owners face felony charges for filing false tax returns and failing to file tax returns.

The Michigan Department Attorney General says Joo's Inc, which did business as Makimoto and Makimoto Sushi Bar, is charged with three counts of making/permitting a false sales tax return, two counts of failure to file a sales tax return and two counts of failure to file a corporate income tax return.

Officials say the owners, Seok Chu and Hwajeong Joo, ignored the Department of Treasury's attempt to audit Joo's Inc. in 2017. An investigation into the business revealed it allegedly filed false tax returns by underreporting its gross sales in 2015, 2016 and 2017.

In addition, no sales tax or corporate income tax returns were filed in 2018 or 2019. The business' unreported and underreported sales for 2015-2019 amount to nearly $2 million.

Officials say Chu failed to file personal income tax returns in 2015, 2018 and 2019, whereas Joo failed to file personal income tax returns in 2017 and 2018.

Chu is charged with three counts of making/permitting a false sales tax return, two counts of failure to file a sales tax return, two counts of failure to file a corporate income tax return and three counts of failure to file an income tax return.

Joo is charged with two counts of failure to file an income tax return.

"I appreciate the work done by our partners at the Department of Treasury that resulted in these charges," said Attorney General Dana Nessel. "We remain committed to ensuring our tax laws are being properly followed."

They were arraigned Monday.

A probable cause conference is scheduled for May 27 and a preliminary examination is scheduled for June 3.

If convicted, each charge is a five-year felony.