The principal owner of The Kettle Black, a popular sports bar and restaurant in the Bay Ridge section of Brooklyn, has pleaded guilty to stealing more than $1.3 million in city and state sales taxes over a five-year period.
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Thomas Casatelli, 40, pleaded guilty to one count each of grand larceny in the second degree and offering a false instrument for filing in the first degree for diverting the the sales taxes between June 1, 2005, and Aug. 31, 2010.
“By failing to pay his taxes, the defendant stole from the pockets of honest taxpayers,” , Manhattan District Attorney Cyrus R. Vance, Jr., said in a statement Wednesday. “Our office will continue its effort to protect hardworking New Yorkers by launching proactive investigations, such as this one, to ferret out systematic tax cheating.”
Casatelli, the majority owner of The Kettle Black, has agreed to pay taxes, insurance premiums, accrued interest and penalties totaling $1,326,940. He admitted in court that he failed to remit to the state over $470,000 in sales tax collected from The Kettle Black, or approximately 70 percent of the sales tax collected from the restaurant’s customers. He also submitted false sales tax returns with the New York State Department of Taxation and Finance.
Casatelli achieved this by underreporting the gross receipts of Kettle Black. He also paid most of his employees “off-the-books,” and thereby failed to collect withholding tax from them or unemployment insurance tax. Casatelli also underpaid insurance premiums on his workers’ compensation insurance policy. In addition, a portion of the unreported gross receipts representing income earned by Casatelli was omitted from his New York personal income tax returns.
According to New York City Department of Finance Commissioner David M. Frankel, the city’s Department of Finance identified The Kettle Black as part of an innovative data-matching program to help identify businesses that are cheating the city out of revenue for vital services. “We are building models, reforming processes and finding new ways to use data to identify the bad actors and refer them to the District Attorney’s Office for prosecution,” he said. “We will protect the vast majority of New Yorkers who play by the rules.”
Casatelli faces up to 15 years in prison on the grand larceny charge, and up to four years on the charge of filing a false instrument.