Michigan Attorney General Bill Schuette last Friday announced that Dong and Christina Chang, the owners of Sushi Samurai Inc. in Orchard Lake, have been sentenced to five years and two years probation respectively for pocketing sales tax dollars paid by customers, but not paid to the State of Michigan.
The Changs were ordered to pay $980,479.59 in restitution, joint and several with each other and Sushi Samurai in January 2018 and were given a suspended sentence until October 11. In addition to probation, the Changs still owe $581,823.18 to the State of Michigan.
The Department of Attorney General previously seized $386,000 which was applied to restitution. In Michigan sales tax dollars go toward the School Aid Fund (72.7%) and Local governments (17.0%).
Dong Chang was convicted of two felony charges, one count of filing false income tax returns and one count of filing false sales tax returns. Christina Chang was convicted of two misdemeanor counts for violations of the tax code.
They were sentenced before Oakland County Circuit Court Judge McMillen.
The Chang’s restaurant, which is registered as an LLC, was sentenced in November 2017.
The Changs were charged after a joint investigation by the Department of Attorney General and the Department of Treasury into whether the restaurant was using an illegal Point of Sale (POS) sales suppression software.
The investigation found that the sales in Sushi Samurai’s records were significantly higher than those reported to the state. The “zapper” software essentially deletes sales from the POS records. It was determined that thousands of sales receipts had been deleted.
The investigation revealed that in total the Changs via their business embezzled over $170,000 in sales tax receipts alone. In addition, over $2.5 million in sales were allegedly never reported or accounted for in income tax filings between 2012-2016. The Changs used this money for business and personal expenses.
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