Hazrat Khalid Khan, 56, who lives in Middletown, NY, but who co-owns 11 fried-chicken take-out places in in Boston and Chelsea, pleaded guilty Wednesday to federal charges of conspiring to defraud the Internal Revenue Service, failing to collect and pay over taxes, committing mail fraud, making false statements on a naturalization application, and committing visa fraud, the US Attorney's office reports.
Khan will be sentenced on Aug. 16.
Federal authorities say Khan and his two co-owners - missing and believed to have fled to Pakistan - ran a tax-evasion scheme for years at their locations, which include New York Fried Chicken at 1195 Blue Hill Ave. in Mattapan, Crown Fried Chicken at 998 Blue Hill Ave. in Mattapan and New York Chicken and Pizza at 531 Columbia Road in Dorchesster.
In a statement, the US Attorney's office said Khan, the two co-owners and several other unidentified co-conspirators figured out how to hide money from the IRS:
"Khan and his co-conspirators - generally the managers of these restaurants - defrauded the government and avoided paying payroll and income taxes owed by the stores. They paid their employees in cash and provided tax preparers with false information about the restaurants’ payroll and income, thereby causing the tax preparers to file false tax returns."
"To avoid paying taxes, Khan and several co-conspirators falsely reported to the IRS the number of employees at their stores - some of whom were undocumented workers - and the wages they paid them. They also failed to file W-2s showing wages paid to employees and falsely described on tax returns their sales, total income, compensation of officers, salaries and wages, and taxable income. Khan and his co-conspirators also failed to withhold payroll taxes and pay them over to the IRS."