Chautauqua Restaurateur Admits Stealing $430,000 In New York State Sales Tax

MAYVILLE, N.Y. (May 24, 2010) - Attorney General Andrew M. Cuomo today announced the guilty plea of a Bemus Point man who admitted stealing almost $430,000 from the state by failing to pay sales tax that he had collected at his local restaurants.

Steven L. Carlson, 51, of Dutch Hollow Road in Jamestown, pleaded guilty today in Chautauqua County Court to Grand Larceny in the Second Degree and faces up to 15 years in prison when he is sentenced on September 14. He was released without bail pending sentencing.

According to court documents, Carlson operated three restaurants; the Village Casino in Bemus Point, the Wing City Grill in Fredonia and an Arby’s Restaurant in Jamestown. While operating these restaurants, from March 1, 2005 until August 31, 2008, Carlson collected but failed to pay to the state approximately $430,000 in sales tax receipts.

“This individual used his businesses to swindle nearly half a million dollars in sales tax revenue from the State of New York,” said Attorney General Cuomo. “By failing to pay these taxes, he shortchanged New Yorkers out of critical revenue that helps fund important services people rely on.”

In 2008, the New York State Department of Taxation and Finance’s Criminal Investigations Division began looking into the actions of Carlson who operated the three restaurants under different corporate identities. Investigators and auditors obtained business records showing that Carlson's restaurants collected approximately $654,900 in sales tax from their customers, but remitted only $224,100 to the State of New York. Sales tax money collected by businesses from their customers belongs to the state and corporate officers are responsible for ensuring that these funds are remitted in a timely fashion.

State Department of Taxation and Finance Acting Commissioner Jamie Woodward stated, "Tax fraud hurts all New Yorkers. Those who commit this crime deprive the state and localities of needed revenue that support education, health care and transportation. We will continue to work with other law enforcement agencies to pursue these cases. I want to thank Attorney General Andrew Cuomo and his staff for their assistance with this case."

The case is being prosecuted by Assistant Attorney General Paul McCarthy of the Criminal Prosecutions Bureau under the supervision of Deputy Bureau Chief Richard Ernst. The investigation was conducted by the New York State Department of Taxation and Finance's Criminal Investigations Division, Investigator Kylee Echeverria and Tax Auditor Evie Cosmas, under the supervision of Chief Investigator Kevin DiPirro, with the assistance of Associate Counsel Melvin A. Parker.

 

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