WASHINGTON — David Chui, who owned and operated garment industry company New Shanghai Fashions, has pleaded guilty to failing to pay employment taxes, the U.S. Justice Department and Internal Revenue Service said Thursday.
Chui, a resident of Queens, N.Y., did not collect, truthfully account for and pay over employment taxes of nearly $220,000 from his employees’ wages for the Manhattan garment assembly business from at least the fourth quarter of 2005 through the third quarter of 2008, according to the plea agreement and criminal information. In addition, the plea agreement requires Chui to pay restitution to the IRS in the amount of $439,918.61, which encompasses the employment taxes that he failed to withhold from his employees and his obligation, as an employer, to pay over a matching portion of those employment taxes.
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Chui faces a maximum sentence of five years in prison, a maximum of three years supervised release and a fine of up to $250,000, the Justice Department said.
This case was investigated by IRS-Criminal Investigation and is being prosecuted by the U.S. Attorney’s Office for the Southern District of New York Complex Frauds Unit. Special Assistant U.S. Attorney and Department of Justice Tax Division Trial Attorney Tino M. Lisella is in charge of the prosecution.
Sentencing is tentatively scheduled for Nov. 18.