The federal courthouse in Bridgeport. A West Hartford man who partially owned several Asian restaurants in Connecticut and Massachusetts pleaded guilty to an “extensive tax fraud scheme” on Friday, according to federal prosecutors.

A West Hartford man who partially owned several Connecticut restaurants has pleaded guilty to what federal prosecutors called an “extensive tax fraud scheme.”

William Chen, 49, used a software to delete transactions, creating fraudulent sales records and suppressing the restaurants’ taxable income for their tax returns for about seven years, according to U.S. Attorney Vanessa Roberts Avery.

He also failed to pay federal and other taxes during this time, Avery said.

In all, Chen owed the IRS more than $2 million, the U.S. Attorney’s office said.

Chen pleaded guilty Friday in Bridgeport federal court to two counts of filing a false tax return. He faces up to six years in prison when he is sentenced Oct. 21 by U.S. District Judge Sarah A.L. Merriam, according to the U.S. Attorney's office.

Chen is a partial owner of several restaurants, including Ginza Japanese Restaurant in Bloomfield, Ginza Japanese Cuisine in Wethersfield, Kaliubon Ramen in Wethersfield and West Hartford and Feng Asian Bistro in Hartford, Canton and Millbury, Mass., the U.S. Attorney’s office said.

As a partial owner, the U.S. Attorney’s office said Chen was in charge of purchasing and using the Point-of-Sale, or POS, system for restaurant orders. He also trained other staff members on how to use the system.

On this POS system, Chen paid an additional fee to activate a “zapper” software, a program designed to “deliberately delete transactions from the POS system to create fraudulent sales records,” the U.S. Attorney’s office said.

From 2013 to 2020, Chen and other restaurant workers “deleted cash transactions with the intent to reduce the gross receipts and the amount of sales tax collected reported by the POS,” according to the U.S. Attorney’s office. “As a result, Chen intentionally suppressed the restaurants’ taxable income that he disclosed to his accountant who prepared his and his restaurants’ income tax returns.”

Chen was also responsible for accounting and keeping the financial records at the restaurants. This included collecting and withholding employment taxes and signing the restaurants’ tax returns. In that same time frame, Chen “failed to withhold, account for, and pay to the IRS federal income taxes, Federal Insurance Contributions Act taxes (“FICA”), and federal unemployment taxes for multiple employees that he paid, or that he knew were paid, in cash,” the U.S. Attorney’s office added.

Chen is free pending his sentencing in October, according to the U.S. Attorney’s office.

Liz Hardaway is a breaking news reporter for Hearst Connecticut Media through the Hearst Fellowship Program.

She previously worked at the San Antonio Express-News to help cover city hall and local issues. She also worked at the Sun Newspapers in Southwest Florida as a general assignment reporter covering politics, business, and health. 

Liz graduated from Ohio Wesleyan University in 2018 with a B.A. in journalism. She enjoys cooking, reading and playing with her dachshund, Finn.