Restaurant Owner Sentenced to 42 Months in Prison for Tax Evasion and COVID-Relief Fraud

SAN DIEGO – Restaurateur Leronce Suel was sentenced in federal court today to 42 months in prison for submitting more than $1.7 million in fraudulent applications for COVID relief programs and failing to report the income to the IRS.

Suel was convicted by a federal jury in September 2024 of wire fraud, conspiracy, and tax crimes. The court ordered him to pay $1,773,245 in restitution to the U.S. Small Business Administration and criminal forfeiture of $1,466,918 from the over $2.4 million in cash seized from Suel’s home in June 2022. Restitution to the IRS will be determined at a hearing on June 6, 2025.

Suel was the majority owner of Rockstar Dough LLC and Chicken Feed LLC, both of which operated restaurants in the San Diego area, including Streetcar Merchants in the North Park neighborhood.

“This defendant took resources meant to support those most vulnerable during a time of crisis and used them for his own enrichment,” said U.S. Attorney Adam Gordon. “By misappropriating over $1.7 million in COVID relief funds, he robbed individuals and families of the assistance they desperately needed. Today, justice holds him accountable for his exploitation of a public emergency for personal gain.”

According to evidence presented at his eight-day trial, Suel conspired with his business partner to underreport over $1.7 million in gross receipts on Rockstar Dough LLC’s 2020 corporate tax return and COVID relief applications. Suel’s businesses also fraudulently received approximately $1,773,245 million in COVID-related Paycheck Protection Program (PPP) loans and Restaurant Revitalization Fund (RRF) grants by falsely certifying his businesses were eligible and that his businesses would use the money appropriately.

Instead of using the COVID-19 relief program funds on eligible expenses like rent and payroll, Suel and his co-conspirator made substantial cash withdrawals from their business bank accounts and purchased a home in Arkansas. As part of their conspiracy, Suel concealed more than $2.4 million in cash in his bedroom.

On June 23, 2022, IRS-Criminal Investigation special agents executed a search warrant at Suel’s residence where they seized the $2.4 million in cash. During the trial, the evidence showed that Suel attempted to cover-up his crimes by providing false information to an accountant who prepared dozens of original and amended tax returns that contained false information.

In 2023, Suel signed and filed these original and amended tax returns for prior years that included false depreciable assets, business losses, and deductions. In one example, Suel caused one business to deduct significant amounts of rent for years 2020 and 2021, but evidence at trial established Suel paid no rent to that restaurant’s landlord.

Suel also failed to report income he received from his business, including millions of dollars in cash and personal expenses paid for by the businesses.

“Mr. Suel’s 10-plus years of tax evasion and fraudulent claims for COVID relief grants and loans caught up to him when a jury of his peers found him guilty,” said Special Agent in Charge Tyler Hatcher, IRS Criminal Investigation, Los Angeles Field Office. “Now Mr. Suel will feel the repercussions of his disregard for his fellow taxpayers. Our tax system only works when people pay their fair share, and IRS-CI will continue pursue those who evade their tax responsibilities to their fellow Americans.”

This case is being prosecuted by Assistant U.S. Attorney Christopher Beeler and Trial Attorney Julia Rugg of the U.S. Department of Justice Tax Division.

DEFENDANTS                                             Case Number 23-CR-965-RBM

Leronce Suel                       Age: 47                Fayetteville, Arkansas

SUMMARY OF CHARGES

Wire Fraud Conspiracy – Title 18, U.S.C., Section 1349

Maximum penalty: Thirty years in prison and $1,000,000 fine

Wire Fraud – Title 18, U.S.C., Section 1343

Maximum Penalty: Thirty years in prison and $1,000,000 fine

Conspiracy to Defraud the U.S. – Title 18, U.S.C., Section 371

Maximum Penalty: Five years in prison and $250,000 fine

Tax Evasion – Title 26, U.S.C., Section 7201

Maximum Penalty: Five years in prison and $100,000 fine

Filing False Tax Returns – Title 26, U.S.C., Section 7206(1)

Maximum Penalty: Three years in prison and $100,000 fine

Failure to File –Title 26, U.S.C., Section 7203

Maximum Penalty: One year in prison and $25,000

INVESTIGATING AGENCY

Internal Revenue Service – Criminal Investigation (IRS-CI)