Full fraud restitution paid by former Gresham strip club owners
Hundreds of thousands of dollars in unpaid business taxes were fully recovered after a trio of strip club operators, including a popular Gresham location, were sentenced of defrauding the IRS and Oregon Department of Revenue in 2016.
On Sept. 23 the Clerk of the Court for the District of Oregon received a payment of $608,217 — the outstanding restitution balance of David, George and Daniel Kiraz.
"Today's restitution payment is the culmination of many years of dogged effort made by our agency and by our partners at the U.S. Attorney's Office," said Special Agent in Charge Bret Kressin, IRS Criminal Investigation. "This is a success we can all share in, as the funds secured today will be used for the benefit of our communities."
David Kiraz, 40, of Happy Valley owned a pair of strip clubs in the Portland-area alongside his father George Kiraz, 62, and brother Daniel Kiraz, 37, both of Portland. There was the Cabaret Lounge on West Burnside Street in Portland and the Cabaret Lounge II on Southeast Stark Street in Gresham. Between 2007-2010 those clubs collected more than $1.5 million in cash for cover charges and dancer stage fees.
According to investigators, the family hid their total income by maintaining a set of books that did not include those cash payments. Their actions led to the underreporting of taxable income, leading to a loss of more than $649,000.
In April 2016, David and George Kiraz were sentenced to three years in federal prison. Daniel Kiraz was sentenced to one year and one day in federal prison.
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