Obayedul Hoque, Tax Evasion, Virginia 2023

A Alexandria, Virginia man has pleaded guilty to his role in a multi-million dollar conspiracy to defraud the Internal Revenue Service (IRS), announced Acting Assistant Attorney General Caroline D. Ciraolo of the Tax Division and U.S. Attorney Dana J. Boente for the Eastern District of Virginia.

Obayedul Hoque, 49, owner of a gas station called Skyhill Shell and multiple Subway restaurant franchises in Alexandria, Arlington, Virginia and Washington, D.C., admitted to conspiring to defraud the United States for the purpose of obstructing the IRS in the ascertainment and collection of individual and corporate income taxes.

Between 2008 and 2014, Hoque and his co-conspirators, who were managers of some of the Subway franchises and the gas station, did not deposit all of the gas station or the Subway franchises’ gross receipts into the corporate or partnership bank accounts.

Instead, Hoque and the managers retained a portion of the gross receipts for their personal benefit and failed to report those funds to the IRS. For the Subway franchises that had no co-conspirator managers, Hoque retained all of the unreported gross receipts for himself.

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

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. Hoque and a co-conspirator also caused false corporate tax returns to be filed on behalf of Skyhill Shell.

Hoque admitted that his conduct caused a tax loss to the IRS of between $1.5 million and $3.5 million. U.S. District Judge Liam O’Grady set sentencing for May 13 at 9:00 a.m. EST. Hoque faces a statutory maximum prison term of five years and a fine of up to $250,000.

As part of his plea agreement, Hoque agreed to pay restitution to the IRS for tax liabilities for the years 2008 through 2013. Acting Assistant Attorney General Ciraolo and U.S. Attorney Boente thanked special agents of IRS-CI, who investigated the case and Assistant U.S. Attorney Uzo Asonye and Assistant Chief Caryn Finley and Trial Attorney Kimberly Shartar of the Tax Division, who prosecuted the case.

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