The four owners of Spa Castle in College Point allegedly failed to report millions of dollars in revenue to avoid paying required taxes, prosecutors announced on Wednesday.
Steve Chon, 57, his brothers Daniel, 54, and Victor, 50, and his daughter Stephanie, 29, own and operate the 100,000-square-foot spa facility located at 131-10 11th Ave.
According to the charges, the family is accused of allegedly failing to report to New York state a total of over $621,000 in sales taxes, $610,000 in corporate taxes, $207,000 in withholding taxes and $131,000 in Metropolitan Transportation Authority surcharge taxes between 2010 and 2013. Within that same time frame, prosecutors said, Spa Castle generated over $22 million per year in revenue.
Records seized during the execution of a search warrant at the location in August of 2015 showed that the defendants avoided paying required taxes by under-reporting the amount of money earned at the facility and by paying employees and vendors in cash.
The defendants face charges of grand larceny in the second degree and criminal tax fraud in the second and third degree. If convicted, each of the individual defendants face up to five to 15 years in prison.
The case was the result of a joint investigation by the New York State Attorney General’s Office and the Department of Taxation and Finance, Criminal Investigations Division. Defendants are presumed innocent unless and until proven guilty.
“Companies that fail to pay their fair share of taxes leave ordinary New Yorkers to foot the bill,” Attorney General Eric Schneiderman said. “We will not tolerate irresponsible business owners who cheat the system and undermine our tax laws.”
This is not the first time the College Point spa facility has made headlines. In February of 2016, the city shut down all of the pools at the location after a 6-year-old girl’s hair was caught in a pool vent, nearly causing her to drown. Days later, reports emerged that several patrons were found having sex inside of the pools and hot tubs at the location.
Most recently, a customer trying to skip out on her bill struck an employee with her car while fleeing the location on Feb. 26.