The owner of a now-closed Uptown Minneapolis restaurant has been charged with 68 counts of tax fraud.
Hennepin County Attorney Mike Freeman announced Wednesday that Michael Whitelaw, 46, of Eagan, is charged with failing to pay sales tax and filing false tax returns after underreporting the restaurant's income for nearly three years.
Whitelaw owned and operated the Social House Asian fusion restaurant on Hennepin Avenue, which closed in July, as well as its predecessor. According to the criminal complaint, Whitelaw underreported the sales at the restaurant by $1.1 million in 2009, 2010 and most of 2011, thereby underpaying the sales tax he owed to the state by $100,000.
Freeman said the restaurant was not having financial difficulties at the time. "He was just ripping people off," he said, according to the Minneapolis-St. Paul Business Journal.
Apparently, Whitelaw was not aware the charges were being filed. When contacted by the Business Journal Wednesday afternoon, Whitelaw said he had "not heard a peep" about the charges before the reporter told him on the phone.
Freeman said the charges came after an investigation by the state Department of Revenue.
"Mr. Whitelaw knowingly took the money his customers rightly thought was going to the state government and kept it for his business," Freeman said. "That type of behavior cheats the taxpayers who are following the law and cheats other businesses in competition with Mr. Whitelaw."
Whitelaw had also been audited by the department before 2009 for failing to file accurate sales tax returns, and had been instructed in the proper procedures, Freeman said.
Whitelaw owes the state $171,391 in taxes, penalties and interest, according to the county attorney's office. He is not in custody, and no court date has been set yet.
Each count he faces is punishable by up to five years in prison and a $10,000 fine, according to the Business Journal.