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Feds: Chinatown restaurateur Tony Hu stiffed state on taxes

Gubernatorial candidate Bruce Rauner gives a hug to Tony Hu in 2014. |Sun-Times file photo

Chicago restaurateur Tony Hu once had a seemingly insatiable appetite for publicity.

But the sort he received Friday may have gone down as a well as a moldy pot sticker.

The local celebrity chef — who has Chinese restaurants across the city, as well as at the Palms Casino Resort in Las Vegas — has been charged with wire fraud and money laundering for allegedly underreporting restaurant receipts paid in cash, federal prosecutors said Friday.

Hu, 48, has been a political player in Chicago for years with his restaurants festooned with photographs of him with celebrities and politicians. He was known as the unofficial mayor of Chinatown. He was also appointed by Mayor Rahm Emanuel to the Commission on Chicago Landmarks — but is no longer on it. And Hu was named to the Asian Americans for Rauner Coalition as Bruce Rauner ran for governor.

The feds say that Hu withheld sales taxes from the Illinois Department of Revenue when customers paid cash. Hu would then deposit that money into his personal bank account. The alleged illegal activity occurred between January 2010 until September 2014, according to the criminal information filed against Hu.

“Defendant Hu modified the restaurants’ sales records and caused the restaurants’ sales records to be modified in order to conceal cash transactions that had occurred at the restaurants,” according to the court documents.

The withheld cash was then allegedly used to pay the restaurants’ employees and suppliers, without recording those expenses in the restaurants’ books and records.

The Chicago Sun-Times first reported that the feds raided nine of Hu’s restaurants and his South Michigan Avenue condo in October 2014 because they believed he was cheating on his taxes.

An undated photo of Chinatown restaurant owner Tony Hu and former Gov. Pat Quinn | Photo from Tony Hu restaurant website
An undated photo of Chinatown restaurant owner Tony Hu and former Gov. Pat Quinn | Photo from Tony Hu restaurant website

The FBI targeted Hu’s locations in Chinatown, Uptown and Downers Grove in its raid, records show.

Before raiding the restaurants, the feds tailed Hu in his black Mercedes-Benz as he drove to Chinatown from his South Michigan Avenue condo, according to a search warrant application. FBI agents also dined at Hu’s restaurants more than a year before the raid to get a closer look at its computer systems and standard receipts, the records show.

Agents also scoured bank records and emails documenting the restaurants’ sales, determining the numbers they found often didn’t match the amounts submitted on the restaurants’ tax forms.

When federal prosecutors file a criminal information against a defendant, rather than a indictment, it often means the individual plans to plead guilty.

Hu’s attorney, Sheldon Zenner, declined to comment on the case on Friday but plans to speak about the case next week, according to Jacquelyn Heard, a spokeswoman for Zenner’s law firm, Katten Muchin Rosenman LLP.

If convicted, Hu faces up to 30 years in prison.

Contributing: Rummana Hussain

Hu Information