The owner of three North Shore restaurants has been sentenced to prison for a tax fraud scheme. John Drivas, 66, from Hampton, N.H., was sentenced by U.S. District Judge Julia E. Kobick to one year and one day in prison followed by a year of supervised release. Additionally, Drivas must pay restitution of $1,596,775 to the Massachusetts Department of Revenue and $439,341 to the Internal Revenue Service (IRS), along with a $20,000 fine.

Drivas had pleaded guilty in September 2024 to multiple charges including five counts of failure to collect and pay over employment taxes owed to the IRS and four counts of wire fraud related to state meals taxes collected but not paid.

Between January 2016 and October 2022, Drivas operated three restaurants: Red’s Sandwich Shop in Salem, Red’s Kitchen and Tavern in Peabody, and Red’s Seabrook in Seabrook, N.H. He was the sole shareholder of the Salem restaurant until its sale in September 2022. He also held ownership stakes with family members in the other two establishments.

Drivas admitted paying "under-the-table" wages totaling $1,496,417 without reporting them or paying associated employment taxes. This resulted in over $439,000 in employment tax losses.

He also failed to remit collected state and local meals taxes as required by law. In Massachusetts, a sales tax rate of 6.25% on meals is mandated along with an additional local option excise tax rate of 0.75% for Salem and Peabody. Drivas withheld $1,596,775 from these obligations.

The announcement was made by United States Attorney Joshua S. Levy alongside Thomas Demeo from the IRS Criminal Investigation Boston Field Office and Katherine Mulligan from the Insurance Fraud Bureau of Massachusetts. The case was prosecuted by Assistant United States Attorney Victor A. Wild with assistance from the Massachusetts Department of Revenue's Criminal Investigations Bureau.