The numbers just didn’t make sense…
State authorities are investigating whether Shogun Sushi & Hibachi has been “cooking its books” to avoid paying tens of thousands of dollars in sales taxes.
The Minnesota Bureau of Criminal Apprehension (BCA) led the execution of a search warrant at the restaurant at 1901 Madison Avenue last week. They collected multiple boxes of invoices, receipts and mailings, along with electronics including an iPhone, a laptop and all of the POS (point of sale) computer systems.
Investigators with the Minnesota Department of Revenue say evidence indicates that Shogun is removing transactions from its records, so it appears its sales are lower and thus the restaurant doesn’t have to pay as much in taxes.
The detectives claim that Shogun ownership, or employees under the owner’s direction, may have deleted nearly 50,000 cash sales from its system between January 2014 and July 2016 alone. Based on the average ticket, that indicates sales of $2.2-million dollars not being reported and a sales tax loss to the state of more than $162,000.
Investigators say another indication of the criminal activity is that the ratio of cash sales at Shogun was significantly below the industry average, but then doubled shortly after the restaurant was informed about the audit.