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Mar-30-2012

Local biz behaving badly – again. Fune Ya owner convicted by feds

Is it just me or does it seem like there’s been a rash of stories lately about crooked business owners in the Richmond District?

First there was Pho Clement not paying employees properly for overtime hours (to the tune of a $316,000 settlement).

Last week, we got word that John Campbell’s Irish Bakery failed to pay some of their employees at all – for months - after the owner expanded too quickly and ran into financial problems.

And let’s not forget the Clement Street convenience store owner who was stealing winning lottery tickets from his customers, only to be exposed on national TV by Dateline NBC’s Chris Hansen.

But now there’s a new one to add to the list, with his own colorful story of crime.

The latest Richmond District business owner to behave badly is Michael Chen, the owner of Fune Ya Japanese Restaurant at 354 Clement Street.

The Chronicle reports that Chen was stashing receipts in boxes in a crawl space underneath the restaurant floor. Feds found 26 boxes of receipts, all not-so-cleverly marked “seasoned Octopus”. The receipts revealed cash transactions that Chen never reported to the IRS. Uh oh.

And before you chalk Chen’s errors up to unskilled accounting… Investigators also found an encrypted Excel spreadsheet in his files that showed $1.9 million in sales (woah, I am in the wrong business!). But Chen only reported $450,165 in sales to the California Board of Equalization and $65,738 in sales to the IRS.

Fune Ya is now closed, and owner Michael Chen was convicted by a federal jury this week of filing false federal corporate income tax returns and mail fraud. No word yet on what his sentence will be.

Sarah B.

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4:30 am | Posted under Classes, Crime | 10 comments
  1. Gary said:

    And, I bet there is a whole lot more thievery and corruption going on.

  2. Peter said:

    I don’t know. The $1.9 million in sales doesn’t sound quite right. That’s $5,205 a day if the place was open 365 days a year, or an average $689.40 an hour (since it was open 53hrs/week) from opening till closing time. This for a restaurant with a reputation for cheap (and not particularly good) sushi.
    Sounds too high. Wonder if that encrypted spreadsheet indicated some “off-business” business as well?

  3. Derek said:

    And here I thought Clement St. was such a quiet and sleepy little part of town…

    Maybe we should fire up the BATSIGNAL!!

  4. stoirin said:

    Over the years, the Richmond has also had its share of stores that were fronts for money-laundering and other things. There are a couple right now that never seem to have any business at all…despite Geary St. locations… and is it just me or do there seem to be an awful lot of “foot massage” businesses opening up. Is there really a huge and growing marketing in our neighborhood for foot massages? I have my doubts — and I’d like to know who is checking up on this. I DO NOT want Geary Blvd to become a haven for prostitution disguised as massage parlors We are a gateway to the world — and we shouldn’t be so naive to think that a quiet neighborhood in S.F. wouldn’t be the perfect place to traffic women and girls from all over the world (boys, too — who would expect that in the Richmond when the Castro is so close?)

  5. AndyS.L. said:

    The Richmond District should not be painted as an innocent area because it not only allows fraudulent people to hide behind relative obscurity, but it also gives the impression that law enforcement should be focused on the Mission or ‘Loin.

    So, if you want to set up a front, where would you do it? Not mid-Market, not BVHP….the Richmond is prime because of this so-called innocence. Get outta your shell! I think commenter #1 Gary sees the light and most folks are in denial. There’s a helluva lotta debauchery in the Richmond! It’s thicker than fog.

  6. Alice said:

    I think the foot massage places are legit. I frequent them. They are pretty cheap massages and not the sketchy kind. Give it a try one day, it’s a great deal.

  7. Alissa said:

    Will someone PLEASE open a taqueria in that space?! Hear me Papalote, Little Chihuahua? You would make a zillion dollars from Green Apple employees alone.

  8. Dan said:

    I agree with Alissa! That is PRIME Location for an Inner Richmond Taqueria. There is already a kitchen, and plenty of space. When will someone answer our call of a much needed, late night taqueria in our neighborhood?

  9. mel said:

    One bright side of Pho Clement debauchery, Perilla is going in the old store front. Fortunately, this place did not stay empty for long; and the awning and signage have great appeal. Not to mention, if the food is as good as the Irving location it should be a hit. I love their garlic noodles with grilled pork. BTW, Perilla appears to be owned by the same company that runs PPQ on Clement.

  10. Local links: GGP history, new sushi spot, BRT resignation, bank robbery & more | Richmond SF Blog said:

    [...] pay their taxes… Remember the restaurant owner at Fune Ya (6th & Clement) who was hiding receipts under his floorboards in shoeboxes marked “seasoned octopus”? He was convicted last March of filing false tax [...]

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