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Restaurant owners charged with underreporting $1.8M in sales

February 9, 2017

Two central Indiana restaurant owners have been charged with theft for allegedly failing to collect taxes by underreporting a total of $1.8 million in sales at six locations.

Manuel Rodriquez Alonso and Rosalio Sanchez have agreed to plead guilty to the charges and to pay nearly $143,000 in restitution to the Indiana Department of Revenue, Marion County Prosecutor Terry Curry said Thursday.

Together, they operate La Cabana Mexican Grill & Bar at 7035 E. 96th St. in Indianapolis; Casa Del Sol Mexican Grill and Ciudad Colonial Fresh Mexican Food in Muncie; Casa Grande Mexican Grill & Bar in Gas City; and El Metate Mexican Grill & Bar in Fairmount. Another eatery they operated, York Pizza in Gas City, has closed.

In announcing the charges, Curry referred to similar charges his office brought in 2015 against the owners of the El Rodeo and El Jaripeo restaurant chain.

“We have previously prosecuted a separate restaurant chain for underreporting an estimated $22.7 million in sales, at which time we stated that restaurant owners should be on notice that they will be investigated and prosecuted if they persist in skimming cash sales in order to avoid their sales-tax obligation,” he said in a written statement.

Sanchez agreed to plead guilty to six counts of theft. Alonso agreed to plead guilty to three counts. All the counts are class D felonies.

The county prosecutor’s office and state department of revenue began investigating the business practices of the six restaurants in February 2015.

According to the probable cause affidavit, an analysis completed of the restaurants' sales from 2013 through 2015 estimated that more than $1.8 of the sales were not reported to the state.

Evidence showed that the owners engaged in different methods to conceal and underreport cash sales. A review of one restaurant’s sales register records, for instance, revealed that the drawer was opened more than 3,200 times in one day. However, nearly one-third of the time it was opened without a sale being recorded, the prosecutor’s office said.

Through search warrants, the prosecutor’s office seized $247,410.95 in cash and bank accounts for possible forfeiture. The owners have agreed that $142,930.66 of the funds will be paid as restitution to the department of revenue for unpaid sales tax and unpaid food and beverage tax.

A separate civil forfeiture action remains pending, in which forfeiture to local law enforcement agencies is sought for the remaining $104,480, the prosecutor’s office said.

An initial hearing date in Marion Superior Court has not been scheduled.

 

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