Alexandria Gas Station Owner Pleads Guilty to IRS Fraud

ALEXANDRIA, VA -- Obayedul Hoque, 49, of Alexandria, pleaded guilty this week to charges of conspiracy to defraud the United States, according to the Justice Department.

Hoque was the owner and operator of Skyhill Shell at 2922 Duke St., and multiple Subway restaurant franchises in Alexandria, Arlington, and Washington, D.C., according to authorities.

Hoque admitted that between 2008 and 2014, he and his co-conspirators, who were managers of some of the Subway franchises and the gas station, conspired to defraud the IRS, according to the U.S. Attorney’s Office for the Eastern District of Virginia. Hoque and his co-conspirators did not deposit all of the gas station or the Subway franchises’ gross receipts into the corporate or partnership bank accounts, authorities said.

Instead, Hoque and the managers retained a portion of the gross receipts for their personal benefit and failed to report the business funds to the IRS, the U.S. Attorney’s Office said. For the Subway franchises that had no co-conspirator managers, Hoque retained all of the unreported gross receipts for himself, authorities noted.

For the period of 2008 through 2013, point of sales records for the Subway franchises reflected total sales of $20,805,667, authorities said. However, Hoque and his co-conspirators provided false monthly sales figures to the accounting firm to prepare the Subway entities’ tax returns, the U.S. Attorney’s Office said.

As a result, Hoque and his co-conspirators caused false corporate and partnership tax returns to be filed for the Subway franchises, which reported sales of only $14,377,696, authorities reported. Hoque and a co-conspirator also caused false corporate tax returns to be filed on behalf of Skyhill Shell, the U.S. Attorney’s Office said.

Authorities said that for some years, some of the entities did not file tax returns with the IRS. Hoque also filed false individual income tax returns with the IRS. Hoque admitted that his conduct caused a tax loss to the IRS of between $1.5 million and $3.5 million, the U.S. Attorney’s Office reported.

Hoque faces a maximum penalty of five years in prison and a fine of $250,000 when sentenced on May 13. As part of his plea agreement, Hoque agreed to pay restitution to the IRS for tax liabilities for the years 2008 through 2013. T

Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Caroline D. Ciraolo, Acting Assistant Attorney General of the Justice Department’s Tax Division, made the announcement after the plea was accepted by U.S. District Judge Liam O’Grady. Assistant U.S. Attorney Uzo Asonye is prosecuting the case along with Assistant Chief Caryn Finley and Trial Attorney Kimberly Shartar of the Tax Division.

PHOTO: Seal of the U.S. Justice Department/courtesy of federal government