indictment charging the owners of several Austin, Texas area
restaurants with federal tax crimes was unsealed today, announced Acting
Deputy Assistant Attorney General Stuart M. Goldberg of the Justice
Department’s Tax Division.
charges Michael Herman and his wife, Cynthia Herman, with conspiring to
defraud the United States by impairing the legitimate functions of the
Internal Revenue Service (IRS) and filing false individual income tax
returns for tax years 2010 through 2012. Michael Herman is also charged
with filing false corporate tax returns for 2010 through 2012.
According to the
indictment, the Hermans owned Cindy’s Gone Hog Wild, a restaurant and
bar in Travis County, Texas, which filed corporate tax returns, and two
restaurants in Bastrop County, Texas, Cindy’s Downtown and Hasler
Brothers Steakhouse, which reported their income and expenses on the
Hermans’ personal tax returns. The indictment alleges that the Hermans
deposited only a portion of the restaurants’ cash receipts into their
business bank accounts and reported only those deposits to their tax
return preparer. The Hermans also allegedly paid for personal expenses
out of the business accounts, including repair of their swimming pool,
utilities for their home and the salary of a household employee. The
indictment charges that the Hermans filed false tax returns that
underreported their income and falsely deducted personal expenses paid
out of the corporate account as business expenses.
If convicted, the
Hermans face a statutory maximum sentence of five years in prison on the
conspiracy charge and three years in prison on each of the false return
charges. They also face a period of supervised release, restitution and
An indictment merely
alleges that crimes have been committed. The defendants are presumed
innocent until proven guilty beyond a reasonable doubt.
Assistant Attorney General Goldberg thanked agents of the IRS Criminal
Investigation, who conducted the investigation, and Trial Attorneys
Robert A. Kemins and David Zisserson, who are prosecuting the case.
Acting Deputy Assistant Attorney General Goldberg also thanked the U.S.
Attorney’s Office for the Western District of Texas for their
Additional information about the Tax Division’s enforcement efforts can be found on the division’s website.