Nicholas J. Faranso, a 45-year-old resident of Farmington Hills, Mich., was sentenced to one year and one day in prison for conspiring to defraud the United States.
Faranso, the owner of two strip clubs, BT’s in Dearborn, Mich., and Tycoon’s in Detroit, used a computerized point of sales system to electronically track and record sales from 2001 through 2004.
However, court documents reveal that Faranso purchased a computer software program called Journal Sales Remover from Theodore Kramer, a self-employed computer software salesman, in 2001.
The Journal Sales Remover program was specifically designed to remove a portion of the actual sales from the computerized point of sales systems, making it appear that Faranso’s clubs received less income than they actually did.
Faranso directed Kramer to put the Journal Sales Remover program onto his businesses’ computer systems in order to help Faranso cheat on the businesses’ taxes.
From about 2001 to about 2004, at Faranso’s request, Kramer made periodic visits to Faranso’s clubs to run the Journal Sales Remover program to remove a substantial amount of the actual sales from the computerized sales systems.
As a result, Faranso falsified the clubs’ tax returns by understating their gross receipts by more than $500,000.
Related Federal Cases
Key Facts
- State: Michigan
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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