Former strip club owner pleads guilty to tax evasion

LAS VEGAS - The former owner of The Crazy Horse Too pleaded guilty Thursday to not paying more than $1.7 million in employment taxes.

Frederick John Rizzolo, 58, entered his plea is U.S. District Court.

Rizzolo paid the strip club's doormen, bouncers, bartenders and shift managers in cash, but failed to provide accurate records of the payments to the club's bookkeepers, according to a news release from the U.S. Attorney's Office.

The cash payments caused false employment tax returns to be filed with the IRS, which underreported wages paid and taxes due. Rizzolo admitted guilt in 2006 to trying to defraud the United States.

The news release says, Rizzolo then took steps to hide his assets and income to keep the IRS from collecting the delinquent taxes he owed.

In one case, Rizzolo directed nearly $1 million to an offshore bank account in the Cook Islands. 

Rizzolo will be sentenced Sept. 15. If the court accepts the parties' agreement, Rizzolo will be sentenced to 24 months in prison and ordered to pay $2.6 million in restitution to the IRS.

 


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