BOSTON – The owners of Nick’s Famous Roast Beef in Beverly, and the wife and son of one of the owners, pleaded guilty this week in U.S. District Court in Boston to skimming nearly $6 million in cash receipts from the business over six years and failing to report the cash as income on their tax returns.
Nicholas Markos, 69, of Lynn, Nicholas Koudanis, 65, and Eleni Koudanis, 60, of Topsfield, were charged with one count of conspiracy to defraud the U.S. by obstructing the IRS and 10 counts of aiding and assisting in the filing of false tax returns. Steven Koudanis, 39, the son of Nicholas and Eleni Koudanis, was charged with one count of obstructing and impeding the IRS laws.
Nicholas Markos and Nicholas Koudanis own Nick’s Famous Roast Beef in Beverly, which only accepts cash payment, according to an indictment. From 2008 to 2013, both men allegedly skimmed more than $1 million in cash receipts each year which they failed to report on either corporate tax returns or their personal tax returns. As a result, they avoided nearly $1 million each in personal income taxes, the indictment said.
The two split up the cash receipts weekly, determining how much to deposit into the business’s bank account and report on their tax returns, how much to use to pay suppliers and employees, and how much to keep for themselves, according to the indictment.
Law enforcement officials said Eleni Koudanis had primary responsibility for the bookkeeping and recruited employees, including her son, Steven, to create false cash register receipts to use in connection with an IRS tax audit of the eatery.
The actual cash register receipts were allegedly destroyed and not provided to the tax preparer who prepared the business and personal tax returns. The indictment said Nicholas and Eleni Koudanis also amassed more than $1.6 million in cash as of December 2014, which they kept in a safe in their home.
Sentencing is set for April 26. The defendants could face up to five years in prison on the charge of conspiracy to defraud the IRS, three years of probation and a $250,000 fine. Judge Patti Saris will make the final determination.