Last month, a manager overseeing two restaurants in the Boston-area was charged in a federal court in Boston with tax fraud.
Burhan Ud Din, 48, of Watertown, faces one count of conspiring to defraud the Internal Revenue Service and 12 counts of failing to withhold and pay employee taxes to the IRS. Two of Din’s co-conspirators, Hazrat Khan, 57, of Middletown, NY, and Khurshed Iqbal, 57, both Pakistani nationals, were charged in an April 2017 18-count superseding indictment with conspiracy and willful failure to pay over taxes. Khan has already pleaded guilty and is expected to be sentenced later this year. Iqbal’s current location is unknown.
The indictment states that Din and his co-conspirators engaged in activities that defrauded the government and allowed Crown Fried Chicken in Chelsea and Kennedy Fried Chicken in Boston to avoid paying their payroll and income taxes. It is alleged that Din, Khan, and Iqbal took actions to hide Khan’s ownership in one of the stores, and that Din gave the tax preparer for both stores incorrect information about payroll and income, leading to the filing of false tax returns.
Under federal law, employers are required to withhold payroll taxes and then pay them to the IRS. To avoid this obligation, Din, Khan, and Iqbal are alleged to have reported incorrect numbers of employees—some of whom were undocumented—and inaccurate wage figures to the IRS. They are also alleged to have paid employees in cash without reporting it and filed income tax returns that incorrectly described sales, total income, officer compensation, salaries, wages, and taxable income for the Chelsea and Boston stores.
The conspiracy to defraud the IRS carries a maximum sentence of five years in prison, three years of supervised release, a fine of $250,000, and restitution. The tax charges against Din carry a maximum sentence of five years in prison, three years of supervised release, a fine of $10,000, restitution, and payment of the costs of prosecution. Sentences are determined by a federal district court judge based on the U.S. Sentencing Guidelines and other statutory factors.