New York State Department of Taxation and Finance Acting Commissioner Jamie Woodward announced today that the former owner of a defunct restaurant in Allegany County pled guilty to a felony charge for failing to pay to the state $46,205 in sales taxes he collected from customers during a three-year period.

Ruben Santiago, 36, who operated the Cuba Main Street Bistro in Cuba from 2005 to early 2008, pled guilty on June 29 to third degree grand larceny, a Class D felony, before the Hon. Thomas P. Brown in Allegany County Court.

Santiago admitted that he stole sales taxes he collected by repeatedly failing to file sales tax returns between March 1, 2005 and February 29, 2008. An examination of Santiago’s business records by Tax Department auditors revealed that Santiago underreported the restaurant’s gross sales by $543,019.

Santiago was sentenced by Judge Brown to make restitution to the State of New York for the full amount of his theft and serve five years probation. 

Acting Commissioner Woodward said, “Sales tax collected by a business is a tax held in trust for the state. When a businessman takes that money for his own use he is committing larceny. The intentional underreporting of sales tax collected - and failing to remit sales tax collected from customers - has substantially contributed to the tax gap we are facing in New York. Our Special Investigations Unit is working across the state with local district attorneys to expose and prosecute those who engage in tax fraud.

“The Department offers programs such as the Voluntary Disclosure and Compliance Program to encourage delinquent taxpayers to become compliant without facing criminal prosecution or civil penalty. It is hoped that these arrests will encourage such taxpayers to come forward and satisfy their tax obligation.  For more information about these programs, go to the Department’s website at www.nystax.gov.”

This case was investigated by auditors and investigators from the Tax Department’s Rochester Special Investigations Unit in conjunction with the Allegany County District Attorney’s Office.  Acting Commissioner Woodward thanked Allegany County District Attorney Terrance Parker for his aggressive prosecution of this case.