On behalf of the spa businesses he owned and managed, a Brookville, New York, man pled guilty today to deliberately failing to collect and pay over employment taxes to the IRS.
Sung Soo Chon, 63, also known as Steve Chon, was the CEO, president, and majority owner of Spa Castle Queens in College Point, New York, and Spa Castle Texas in Carrolton, Texas, according to court documents and testimony given in court.
The daily operations of the two spas and associated enterprises were overseen by Chon, who also gave orders to subordinates to give cash compensation to some workers, many of whom were not authorized to work in the United States.
In addition to filing false employment tax forms with the IRS between the first quarter of 2014 and the first quarter of 2017, Chon failed to deduct all of the legally required federal payroll taxes from the earnings of selected spa employees.
Chon forced the companies to conceal more than $1.3 million in cash pay throughout this time. The spa businesses owe the IRS payroll taxes totaling $199,238 in total, but they have not paid them.
On December 6, Chon is due to get his punishment. He might be sentenced to a maximum of five years in prison, as well as restitution, financial penalties, and a period of supervised release.
The U.S. Sentencing Guidelines and other statutory considerations will be taken into account by a federal district court judge when determining any punishment.
The statement was made by U.S. Attorney Breon Peace for the Eastern District of New York and Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division.
The situation is being looked into the IRS-Criminal Investigation.
The case is being prosecuted by Trial Attorney Ann M. Cherry of the Tax Division and Assistant Chief Jorge Almonte.