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Washington Attorney General Gets Guilty Plea in First Ever Criminal Sales Tax Case

Posted Monday, November 27, 2017 by Lizanne Padula.

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Yu-Ling Wong, owners of the Facing East restaurant in Bellevue, pleaded guilty to first-degree theft and unlawful use of sales suppression software. Wong used the sales suppression software to hide cash transactions, and pocketed an estimated $395,000 in sales tax collected from her customers.

The Punishment

Wong’s punishment includes a mandate to pay $300,000 in restitution to the Department of Revenue, $600 in penalties and fees, and the Department of Revenue will monitor Wong and her restaurant for five years.

The restaurant itself also entered a corporate guilty plea to first-degree theft, unlawful use of sales suppression software, and two counts of filing a false or fraudulent tax return. For the four charges, the court fined Facing East restaurant $40,000, which is suspended so long as Wong continues with the five-year monitoring agreement with the Department of Revenue.

The Law

In 2013, Washington State passed a law that made it illegal “for any person to knowingly sell, purchase, install, transfer, manufacture, create, design, update, repair, use, possess, or otherwise make available, in this state, any automated sales suppression device or phantom-ware.” (RCW 82.32.290 (4)(a)).

This case against Wong is the first prosecution in the United States for the use of sales suppression software. “Sales suppression software helps dishonest businesses steal from Washington taxpayers,” said case prosecutor, Attorney General Bob Ferguson.

Sales Suppression Software

Sales suppression software is designed to run on a point-of-sale cash register and operates to re-balance the company financial records to show a lower sales figure, which serves to reduce the business’ tax obligation. The business then pockets the additional sales tax customers paid instead of paying that sales tax to the state. Sales suppression software allows the user to remove cash from the register while still reflecting balanced business records.

Defending Against Criminal Charges

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Hiring an experienced criminal defense attorney can help you get the best possible outcome in your case. Come meet with us for a free consultation to explore how we can help you. Our attorneys have outstanding reputations. Lizanne Padula is a tireless negotiator and a tenacious litigator. Ms. Padula was appointed to serve as a Judge Pro-Tem in Snohomish County in May of 2017. She also serves as the Board President for Citizens for Judicial Excellence (CJE), teaches Ethics as part of the Continuing Legal Education credits (CLEs) offered by CJE, and teaches CLEs for the Washington Association of Criminal Defense Lawyers (WACDL).

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