Former Owner of Medford Pizza Shop Sentenced for Federal Tax Charges

BOSTON – The former owner of Pinky’s Famous Pizza in Medford was sentenced today in federal court in Boston in connection with filing tax returns which failed to disclose the cash payroll payments he paid to employees. 

Nikita Yanakopulos, 40, of Medford, was sentenced by U.S. District Court Judge Richard G. Stearns to one year and one day in prison, one year of supervised release and a fine of $5,500. In February 2018, Yanakopulos pleaded guilty to two counts of aiding and assisting in filing false Forms 941, Employer’s Quarterly Federal Tax Return, which are used to report income taxes, Social Security taxes, and Medicare taxes withheld from employees’ paychecks.

Yanakopulos owned and operated Pinky’s from approximately 2000 to 2017. During that period, Yanakopulos paid several employees by check and cash and other employees entirely in cash. Yanakopulos caused his payroll service to file Forms 941 that only included the payroll paid by check. During those years, Yanakopulos made cash payroll payments to his employees totaling approximately $675,000, but failed to report those payments to his payroll service or pay the required withholding amounts to the IRS. He thereby avoided paying FICA, Medicare, and withholding taxes totaling approximately $172,000.    

United States Attorney Andrew E. Lelling and Kristina O’Connell, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston, made the announcement. Assistant U.S. Attorney Mark J. Balthazard of Lelling’s Economic Crimes Unit prosecuted the case.