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Nassau County resident Adel Kellel, 63, of New Hyde Park, the former owners of Raffles Bistro in New York City, has been sentenced to two years in prison after pleading guilty in Manhattan federal court earlier this year to a $771,195 scheme, acting U.S. Attorney Audrey Strauss said.
In addition to his prison term, Kellel was also ordered to pay $613,478 in restitution to the IRS and $157,717 to the New York State Department of Taxation and Finance.
Strauss said that as of 2011, Kellel was the president and a 45 percent owner of K&H Restaurant, which operated Raffles Bistro in a Manhattan hotel, taking over as 100 percent owner between 2012 and 2015.
While he was the owner, Kellel admitted to concealing and did not report a substantial portion of the restaurant's gross receipts.
As part of the scheme, Kellel deposited cash income received from Raffles’ customers into personal bank accounts or spent it directly on personal expenses, without disclosing it to his accountants or paying taxes on it.
Kellel also diverted more than 150 checks from the hotel, totaling more than $2 million in gross receipts by depositing the checks into a dozen bank accounts that Kellel did not disclose to his accountants.
According to Strauss, Kellel used the diverted income to live a lavish live that included overseas transfers; condominium fees; rent for a high-end Manhattan apartment; college tuition payments from his children; shopping at luxury retailers, such as Hugo Boss and Saks Fifth Avenue; payments for luxury cars manufactured by Mercedes, Porsche, and Maserati; and payments for domestic and international travel.
"Adel Kellel cooked his books to conceal income from the IRS and his own accountants," Strauss said. "He spent the ill-gotten gains on personal luxuries like a Mercedes, a Porsche, and a Maserati. Now he will spend two years in federal prison.”
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