Husband and wife indicted for respective roles in alleged tax fraud scheme regarding three restaurants
OAKLAND - Man Young Kim and Kyong Ja Kim, husband and wife, appeared in federal court today to face charges that they conspired to defraud the United States and committed related tax crimes, announced United States Attorney Brian J. Stretch and Michael T. Batdorf, Special Agent in Charge, Internal Revenue Service. The couple appeared before U.S. Magistrate Judge Kandis A. Westmore and were arraigned on charges related to three Bay Area sushi restaurants owned by the Kims, Sushi Boat Oakridge, Sushi Boat Valley Fair, and Sushi Boat Westgate.
A federal grand jury indicted the Kims on June 29, 2017. According to the indictment, Man Kim, 63, and Kyong Kim, 57, both of Dublin, Calif., each own 50 percent of the three sushi boat restaurants at issue and are alleged to have conspired to defraud the United States by failing to report income from the restaurants. The indictment describes an alleged scheme by which both defendants denied the existence of records related to daily income; then, after investigators sought computer records, Kyong Ja Kim allegedly hired a computer consultant to delete relevant data from the restaurants’ computer system. Both defendants are charged with conspiracy to defraud the United States, in violation of 18 U.S.C. § 371. In addition, Kyong Ja Kim is charged with preparing and filing false employment tax returns, in violation of 26 U.S.C. § 7206(2), and preparing and filing a false federal income tax return, in violation of 26 U.S.C. § 7206(1). In addition to the conspiracy charge, Man Young Kim is charged with three counts of filing false tax returns, in violation of 26 U.S.C. § 7206(l), and nine counts of willfully failing to collect, account for, and pay over to the IRS the federal income taxes, in violation of 26 U.S.C. § 7202.
Following today’s appearance, the defendants were released on bond. Defendants’ next court appearance is scheduled for Aug. 31, 2017, at 2:00 p.m., before the Honorable Yvonne Gonzalez Rogers, U.S. District Court Judge.
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted of the conspiracy charge, the defendants face a maximum sentence of five years in prison, a fine of $250,000, and restitution, if appropriate. In addition, Man Kim faces a maximum of three years of prison time, and a fine of $250,000, plus restitution for each violation of 26 U.S.C. § 7206(1) (filing false returns) and a maximum of 5 years of prison time, and a fine of $250,000, plus restitution for each violation of 26 U.S.C. § 7206(2) (willful failure to collect and pay over taxes). Kyong Kim faces a maximum of three years of prison time, and a fine of $250,000, plus restitution for each violation of 26 U.S.C. § 7206(2) (aiding and assisting in preparing false returns). However, any sentence following conviction would be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant U.S. Attorney Cynthia Stier is prosecuting the case. The prosecution is the result of an investigation by the Internal Revenue Service.
Source: U.S. Department of Justice, Office of the United States Attorneys
