Fraud Buffet

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Man using calculator and calculate bills in home office.

If you try to look up the online menu for the New China Buffet & Grill (NCBG) in Clarksville, Tenn., you’ll find that the restaurant is permanently closed. However, its “out of business” status is not due to the COVID-19 pandemic, but because of the owner’s decision to harbor illegal immigrants. As a result of this unfortunate decision, Quanwei Shi, 31, pleaded guilty to harboring illegal aliens, money laundering, tax evasion, and employment tax fraud. (If fraud were served on a buffet, this fraudster loaded up his plate without much thought about the incredible indigestion he would suffer later.)

Between 2017 and April 2019, Shi allowed undocumented workers from China and Guatemala to live with him at his home in Clarksville. He transported them to and from NCBG, where they worked in the kitchen, each day. (He purposely kept them behind the scenes so they would not interact with the restaurant patrons.)

Shi not only hid the undocumented workers from the establishment’s guests, but also from the government. The owner did not make these workers complete any immigration status forms and paid them in cash so they would not be tracked by the restaurant’s payroll system.

Shi also underreported his gross receipts on NCBG’s corporate tax returns. (That’s so he would not have to pay taxes on the income.) He also failed to collect, account for, and pay employment taxes for a tax loss of $440,941. (He tried to cook the books, but he was the one that got burned in the end.)

When sentenced for trying to defeat the tax laws of the U.S., Shi faces up to 45 years in prison. He will most likely have to forfeit his Clarksville home, two vehicles, and $76,073.25 in cash from two bank accounts.

Perhaps the judge will hand out an appropriate fortune cookie when Shi’s sentence is delivered. (My guess is that it will read something like, “It takes less time to do the right thing than it does to explain why you did it wrong.”)

Today’s Fraud of the Day comes from a Department of Justice press release, “Clarksville Restaurant Owner Pleads Guilty In Alien Harboring and Tax Fraud Conspiracy,” dated March 3, 2021.

NASHVILLE, Tenn. – March 3, 2021 – The majority owner of the New China Buffett & Grill (NCBG) in Clarksville, Tennessee, pleaded guilty yesterday in U.S. District Court to conspiracy to harbor illegal aliens; harboring illegal aliens; money laundering; tax evasion; and employment tax fraud, announced Acting U.S. Attorney Mary Jane Stewart for the Middle District of Tennessee.

Quanwei Shi, 31, of Clarksville, pleaded guilty before U.S. District Judge Eli J. Richardson.  Shi and NCBG co-owner Chongqiang Chen, 30, also of Clarksville, were arrested in April 2020, after a 14-count indictment charged them in a scheme to harbor undocumented workers and to defeat the tax laws of the United States.

 

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Larry Benson, Senior Director of Strategic Alliances, LexisNexis Risk Solutions - Government

Larry Benson is responsible for developing strategic partnerships and solutions for the government vertical. His expertise focuses on how government programs are defrauded by criminal groups, and the approaches necessary to prevent them from succeeding.

Mr. Benson has 30 years of experience in sales and business development. Before joining LexisNexis® Risk Solutions, he spent 12 years founding and managing two software technology startups. During the 1990s he spent 10 years as a Regional Director helping to grow a New England-based technology company from 300 employees to 7,000. He started his career with Martin Marietta Aerospace working on laser guided weapons and day/night vision systems.

A sought-after speaker and accomplished writer, Mr. Benson is the principal author of “Fraud of the Day,” a website dedicated to educating government officials about how criminals are defrauding government programs. He has co-authored WTF? Where’s the Fraud? How to Unmask and Stop Identity Fraud’s Drain on Our Government, and Data Personified, How Fraud is Changing the Meaning of Identity.

Benson holds a Bachelor of Science in Physics from Albright College, and earned two graduate degrees – a Master of Business Administration from Florida Institute of Technology, and a Master of Science in Engineering from Lehigh University.