Former Ocean City Pizzeria Owner Admits To Tax Evasion: IRS

OCEAN CITY, NJ — A former Ocean City pizzeria owner pleaded guilty to conspiracy to evade income taxes, authorities said.

The former half owner and operator of Mario's Pizza, Ernesto Cannuscio, 70, of Linwood, defrauded the government of about $208,448 in taxes, IRS investigators said.

Cannuscio was involved with the restaurant between Oct. 2013 and Sept. 2018. During this time, he only deposited credit card receipts to the pizzeria's bank account and paid employees off the books in cash, the IRS said.

Cannuscio used a portion of the cash receipts to pay the employees, the IRS said. He also supplied the pizzeria's accountant with bank account statements, knowing that the cash receipts were not in there, the IRS said.

"Cannuscio did not tell his accountant about the cash receipts, nor did he tell the accountant about the cash payroll to Mario’s Pizza’s employees," prosecutors said.

This led to the accountant underreporting the gross receipts on corporate tax returns, as well as the flow of cash that would be reported on Cannuscio's personal tax return, the IRS said. By not telling the accountant about the cash wages paid to the employees, Cannuscio also evaded employment taxes, the IRS said.

“Business owners have an obligation to properly report all of the income earned whether
paid in cash, check or credit card,” said Tammy Tomlins, acting special agent in
charge of the IRS Criminal Investigation, Newark Field Office. “Failing to intentionally report
income and paying employees cash off the books to evade taxes will not go
unpunished.”

Cannuscio will be sentenced on Oct. 25, 2022. His guilty plea carries a maximum potential of five years in prison and a potential fine of $250,000.