San Jose seafood restaurant owner charged with bilking $3.5M from COVID relief funds
SAN JOSE, Calif. - A federal grand jury has indicted a San Jose restaurant owner with bilking $3.5 million in federal COVID-19 relief funds and spending it to refinance his home, buy a Lexus and use at a casino, charging documents indicate.
David Tai Leung, who owns half of Tomi Sushi and Seafood Buffet in a mall at 2200 Eastridge Loop, was charged Wednesday in U.S. District Court on allegations of his fraudulent use of payments from the Restaurant Revitalization Fund.
Leung had no attorney of record in this case and efforts to contact him on Friday were not immediately successful. An employee who answered the phone at his restaurant during the lunch hour said, "He's not here, call his cell phone," though she did not provide it.
Leung received $5 million in June 2021 from the federal fund, which was supposed to help restaurants recover from their losses in the pandemic, according to the indictment.
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He signed documents in May 2021 promising to use those pandemic funds to pay his employees, keep the lights on and to keep his business operating from February 2020 through March 2023. The restaurant serves all-you-can eat Japanese and Hong Kong-style food.
Instead, the grand jury said Leung transferred $3.5 million to a personal account and used much of it to invest in securities, where much of this money was lost.
The grand jury also found he used about $40,000 to refinance his home in Sacramento, and also pay the Lexus dealer in Roseville and the Red Hawk Casino.
Leung has his share of legal troubles dating back at least five years.
In April 2021, Attorney General Rob Bonta charged Leung, Sunny Siukeung Chan and Wendy Lai Ip, with stealing more than $893,000 in wages from their employees and evading $287,697 in sales taxes and $171,820 in employment taxes.
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They are facing 65 counts, including filing a false tax return with intent to evade paying taxes, failure to pay unemployment insurance and training taxes, failure to pay disability insurance, failure to collect and pay income tax, and grand theft of labor.
The allegations occurred between 2012 and 2018, according to the criminal complaint in the case.
The charges are still pending in Sacramento County Superior Court, with the next hearing scheduled in February.
And in June 2018, the state Labor Commissioner accused Leung and other owners of the Kome Japanese Seafood Buffet in Daly City of violating minimum-wage laws, overtime and other wage protections for 133 workers.
Leung told The Chronicle at the time that he had done nothing wrong, but he and his co-owners agreed to a $2.6 million settlement to compensate the former employees in 2020. The restaurant shut down in January 2019.