TOLEDO (AP) — The former operator of seven IHOP restaurants in Ohio and Indiana, including Findlay’s, has pleaded guilty to what the government called a scheme to hide profits from IHOP’s parent company.
Investigators said the plan involved hiring illegal immigrants, manipulating sales figures, and underreporting wages in order to avoid paying taxes along with royalties to the corporation.
Tarek Elkafrawi, 57, of suburban Toledo, owned or operated six IHOP restaurants in northwestern Ohio and one in Evansville, Indiana.
He pleaded guilty Thursday in federal court in Toledo to 53 charges, including conspiracy to commit money laundering, alien harboring, identity theft, and arson. His wife, Kelly Elkafrawi, 51, pleaded guilty to one count each of money laundering and alien harboring.
Elkafrawi’s attorney, Rick Kerger, said he and his client achieved a resolution that served everyone’s interests.
A sentencing date has not been set.
Elkafrawi’s restaurants were raided in 2011 by federal agents. The Elkafrawis and more than a dozen of their employees were indicted in May 2012.
One of the employees, Jose Leon-Gonzalez, in April admitted setting fire to the Findlay restaurant in 2008. He was sentenced to 41 months in prison.
According to federal prosecutors, Leon-Gonzalez set the fire at the direction of Tarek Elkafrawi in order to file a fraudulent insurance claim.
The Findlay IHOP, on Hancock County 236, reopened after the fire, but closed again after the indictments were issued in 2012.
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