Superseding Indictment — USA v. Suel et al (Dkt. 58, S.D. Cal.)

Summary

A superseding grand jury indictment filed February 2, 2024 as Document 58 against Leronce Suel alone in United States v. Suel, Case 3:23-cr-00965-RBM, in the U.S. District Court for the Southern District of California. Its caption lists charges including conspiracy to commit wire fraud under 18 U.S.C. § 1349, money laundering conspiracy, conspiracy to defraud the United States, tax evasion, filing a false tax return and failing to file a tax return. Count 1 alleges that Suel and an unindicted co-conspirator, owners of Rockstar Dough LLC and Chicken Feed LLC, under-reported 2020 gross receipts on Form 1120-S and made false statements to obtain PPP loans and Restaurant Revitalization Fund money from the SBA. The forfeiture allegation seeks $2,421,345.00 in U.S. currency seized on June 23, 2022 and real property in Fayetteville.

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Case 3:23-cr-00965-RBM Document58_ Filed 02/02/24 PagelD.361 Page1of 22

FILED

UNITED STATES DISTRICT COURT Feb 02 2024

CLERK, U.S. DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA _ | SOUTHERN DISTRICT OF CALIFORNIA
BY STN DEPUTY

February 2023 Grand Jury

UNITED STATES OF AMERICA, Case No. 23CRO965-RBM
Plaintiff, INDICTMENT
{Superseding)
Title 18, U.S.C., Sec, 1349 -
LERONCE SUEL, Conspiracy to Commit Wire Fraud;
Title 18, U.S.C., Sec. 1343 -
Defendant. Wire Fraud; Title 18, U.S.C.,

Sec. 2 - Aiding and Abetting;
Title 18, U.S.C., Sec. 1956(h) -
Money Laundering Conspiracy;

Title 18, U.S.C., Sec. 371 -
Conspiracy to Defraud the United
States; Title 26, U.S.C.,

Sec. 7201 - Tax Evasion; Title 26,
U.S.c., Sec. 7206(1) - Filing False
Tax Return; Title 26, U.S.C.,

Sec. 7203 - Failing to File a Tax
Return; Title 18, U.S.c.,

Secs. 982({a) (1) (C), 982{a) (1), ana
982{a) (2), and Title 28, U.S.C.,
Sec. 2461(c) - Criminal Forfeiture

The grand jury charges, at all times relevant herein:

Persons, Entities, and Background

1, Defendant LERONCE SUEL (“SUEL”) was a United States citizen
residing in or around San Diego, California, within the Southern District

of California.

2. SUEL and UNINDICTED CO-CONSPIRATOR 1 (“UCC-1") were the owners

of Rockstar Dough LLC and Chicken Feed LLC, which operated a series of

ECB:nlv:San Diego:2/2/24
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Case 3:23-cr-00965-RBM Document 58 Filed 02/02/24 PagelD.362 Page 2 of 22

restaurants in or around San Diego, California, hereinafter the
“Restaurant Group.”

3. SUEL had an 85 percent ownership share of Rockstar Dough LLC.
ucc-1 had a 15 percent ownership share of Rockstar Dough LLC.

4. SUEL had a 70 percent ownership share of Chicken Feed LLC.
ucc-1 had a 15 percent ownership share of Chicken Feed LLC. A trust was
a 15 percent owner of Chicken Feed LLC.

5. The Paycheck Protection Program (PPP) was a Small Business
Administration (SBA) backed loan that helped businesses keep their
workforce employed during the COVID-19 crisis. One version of a PPP loan
was known as the “First Draw” PPP loan, which could be used to help fund
payroll costs, including benefits, and could also be used to pay for
mortgage interest, rent, utilities, worker protection costs related to
COVID-19, uninsured property damage costs caused by looting or vandalism
during 2020, and certain supplier costs and expenses for operations.

6. SBA forgave loans if all employee retention criteria were met,
and the funds were used for eligible expenses. First draw PPP loans made
to eligible borrowers qualified for full loan forgiveness if during the
8- to 24- week covered period following loan disbursement: employee and
compensation levels were maintained, loan proceeds were spent on payroll
costs and other eligible expenses, and at least 60 percent if the
proceeds were spent on payroll costs.

7. PPP allowed certain eligible borrowers that previously
received a PPP loan to apply for a “Second Draw” PPP loan with the same
general loan terms as their Frist Draw PPP loan.

8. The Restaurant Revitalization Fund (RRF) was an SBA program
that provided emergency assistance for eligible restaurants, bars, and

other qualifying businesses impacted by COVID-19. This program provided

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Case 3:23-cr-00965-RBM Document 58 Filed 02/02/24 PagelD.363 Page 3 of 22

restaurants with funding equal to their pandemic-related revenue loss
up to $10 million per business and no more than $5 million per physical
location. Recipients were not required to repay the funding so long as
the funds were used for eligible uses no later than March 11, 2023.

9. The Employee Retention Credit (ERC) was a refundable tax
credit against certain employment taxes equal to 50 percent of the
qualified wages an eligible employer paid to employees after March 12,
2020 and through December 2020. For 2021, the ERC was a refundable tax
credit against certain employment taxes equal to 70 percent of the
qualified wages an eligible employer paid to employees after
December 31, 2020 and through September 2021. For purposes of the ERC,
an eligible employer was a business with operations that were partially
or fully suspended due to government orders due to COVID-19 or a business
that had a 50 percent decline in gross receipts as compared to the same
quarter in 2019.

10. The Internal Revenue Service (“IRS”) was an agency of the
United States Department of the Treasury responsible for enforcing and
administering the tax laws of the United States, and collecting taxes
owed to the United States Department of the Treasury.

11. IRS Form 1040, U.S. Individual Income Tax Return (“Form 1040”)
was a form that could be used by taxpayers to file their individual
income tax return.

12. IRS Form 1065, U.S. Return for Partnership Income “Form 1065”
was used by businesses that elected to be treated as a partnership to
report information such as income, gains, losses, deductions, and
credits. A partnership does not pay tax on its income but any profits
or losses flow-through to its partners. Partners must include

partnership items on their tax or information returns.

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Case 3:23-cr-00965-RBM Document 58 Filed 02/02/24 PagelD.364 Page 4of 22

13. IRS Form 1120-S, U.S. Income Tax Return for an S Corporation
(“Form 1120-S”)} was used by businesses that elected to be treated as an
S Corporation to report information such as income, deductions, and
dividends paid to shareholders. An S Corporation does not pay taxes on
its income but any profits or losses flow-through to its shareholder.
Shareholders must include S Corporation items on their tax or information
returns.

14. Schedule K-1 (Form 1065 or 1120-S), Partner’s or Shareholder’s
Share of Income, Deductions, Credits, etc. (“Schedule K-1"”) was used to
report a partner’s or shareholder’s share of a Partnership or §
corporation’s income, deductions, credits, and other items. The
partnership or corporation was required to issue the Schedule K-1 to
both the IRS and its partners or shareholders.

15. For tax year 2020, Rockstar Dough LLC filed a tax return with
the IRS using Form 1120-S for S-corporations.

16. For every quarter from at least on or around December 2014
until at least on or around December 2021, Rockstar Dough LLC had
employees. Rockstar Dough LLC was required to withhold taxes from its
employee’s paychecks. These taxes included federal income taxes, as well
as Social Security and Medicare taxes (often referred to as Federal
Insurance Contribution Act “FICA” taxes). Collectively, these three
components are commonly referred to as “trust fund taxes.”

17. In addition to the trust fund taxes, Rockstar Dough LLC was
separately required to make contributions for Social Security and
Medicare in amounts matching the amounts withheld from its employees’
pay. Collectively, the trust fund taxes, and the matching Social Security

and Medicare contributions are commonly referred to as “employment

taxes.”
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18. Rockstar Dough LLC was required to make deposits of the
withheld employment taxes to the IRS for each quarter that it paid wages
to employees. Additionally, Rockstar Dough LLC was required to file with
the IRS, following the end of each calendar quarter, an IRS Form 941,
Employer’s Quarterly Federal Income Tax Return (“Form 941”), setting
forth the total amount of trust fund taxes withheld, the total amount
of Medicare and Social Security taxes due, and the total tax deposits.
The deadline to file a Form 941 is the last day of the month following
the last day of each quarter.

Count 1

[Conspiracy to Commit Wire Fraud - 18 U.S.C. § 1349]

19. Paragraphs 1 through 18 of the Superseding Indictment are re-
alleged and incorporated by reference.

20. Beginning in or about March 2020 and continuing until at least
June 2022, within the Southern District of California, and elsewhere,
defendant LERONCE SUEL and UCC-1 knowingly conspired and agreed with
each other, to commit the offense of wire fraud, in violation of
Title 18, United States Code, Section 1343, that is, defendant devised
and intended to devise a scheme and artifice to defraud and to obtain
money and property by means of false and fraudulent pretenses,
representations, and promises, and for the purpose of executing and
attempting to execute such scheme and artifice, transmitted and caused
to be transmitted in interstate and foreign commerce certain wire

communications.

A. Object of the Conspiracy

21. It was the object of the conspiracy that SUEL and UCC-1 would
unjustly enrich themselves by submitting intentionally false loan and

loan forgiveness applications to the SBA.

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Case 3:23-cr-00965-RBM Document 58 Filed 02/02/24 PagelD.366 Page 6 of 22

B. Manner and Means

22. It was a part of the conspiracy that SUEL and UCC-1 devised a
scheme through which they under reported gross receipts of Rockstar
Dough LLC for tax year 2020 on Form 1120-S filed with the IRS to show a
false financial loss so that Rockstar Dough LLC could qualify for
Paycheck Protection Program loans and loan forgiveness and Restaurant
Revitalization Funding program loans.

23. It was also a part of the conspiracy that SUEL and UCC-1 made
materially false representations on loan and loan forgiveness
applications submitted to the SBA so that Rockstar Dough LLC and Chicken
Feed LLC would receive Paycheck Protection Program loans and Restaurant

Revitalization Funding loans.

Cc. Overt Acts

24. The following overt acts in furtherance of the conspiracy,
among others, were committed within the Southern District of California,
and elsewhere:

a. For tax year 2020, UCC-1 sent a fraudulent profit and
loss statement to Accountant 1 for Rockstar Dough LLC, who relied upon
this fraudulent profit and loss statement to prepare Rockstar Dough
LLC’s Form 1120-S titled “U.S. Income Tax Return for an S Corporation.”

b. SUEL and UCC-1 then caused Rockstar Dough LLC to file a
Form 1120-S with the IRS for tax year 2020. On that form, Rockstar Dough
LLC reported its gross receipts were $675,026 and that its ordinary
business loss was $619,896. However, SUEL and UCC-1 knew Rockstar Dough
LLC received gross receipts totaling at least $2,452,511 from various
merchant processers——-such as UberEats, Postmates, DoorDash, and Square,
among others—as reported on Forms 1099-K mailed to SUEL and UCC-1 and

filed with the IRS by those merchant processors. Thus, SUEL and UCC-1

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Case 3:23-cr-00965-RBM Document 58 Filed 02/02/24 PagelD.367 Page 7 of 22

caused at least $1,777,785 of Rockstar Dough LLC’s revenue not be
reported to the Internal Revenue Service for tax year 2020.

om On May 12, 2020, Rockstar Dough LLC received a First Draw
Paycheck Protection Program loan in the amount of $82,850 deposited into
its Wells Fargo business bank account ending in -9744. On July 15,
2021, SUEL knowingly filed via the Internet an application seeking
forgiveness of the $82,850 loan to the SBA by falsely certifying that
Rockstar Dough LLC spent the entire loan on payroll costs between May 12,
2020 and July 11, 2020. However, this certification was false, as shown
on Rockstar Dough LLC’s Forms 941, which show total wages of $0 for the
second quarter of 2020 and total wages of $29,408 for the third quarter
of 2020.

d. On May 13, 2020, Chicken Feed LLC received a First Draw
Paycheck Protection Program loan in the amount of $142,345 deposited
into its Wells Fargo business bank account ending in -7285. On July 15,
2021, SUEL knowingly filed via the Internet an application seeking
forgiveness of the $142,345 loan to the SBA by falsely certifying that
Chicken Feed LLC used the loan for approved expenses such as wages and
rent, even though, in truth, Chicken Feed LLC was not in operation during
the relevant time, paid $0 in wages, and did not pay its landlord any
rent during the relevant period.

e. On January 14, 2021, SUEL submitted via the Internet a
Second Draw Paycheck Protection Program loan application to the SBA on
behalf of Chicken Feed LLC in which SUEL falsely certified that, among
other things, Chicken Feed LLC used its First Draw Paycheck Protection
Program loan for “eligible expenses” when it had in fact not done so.

On March 29, 2021, Chicken Feed LLC received a Second Draw Paycheck
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Case 3:23-cr-00965-RBM Document 58 Filed 02/02/24 PagelD.368 Page 8 of 22

Protection Program loan in the amount of $181,455 deposited into its
Wells Fargo business bank account ending in -7285.

£. On January 14, 2021, SUEL submitted via the Internet a
Second Draw Paycheck Protection Program loan application to the SBA on
behalf of Rockstar Dough LLC in which SUEL falsely certified that
Rockstar Dough LLC had realized a reduction in gross receipts in excess
of 25% between tax years 2019 and 2020 when in fact SUEL knew Rockstar
Dough LLC increased gross receipts between tax years 2019 and 2020. On
April. 16, 2021, Rockstar Dough LLC received a Second Draw Paycheck
Protection Program loan in the amount of $105,728 deposited into its
Wells Fargo business bank account ending in -9744.

g. On May 3, 2021, UCC-1 submitted a false Restaurant
Revitalization Fund loan application to the SBA via the Internet on
behalf of Rockstar Dough LLC. As part of that application’s supporting
documents, UCC-1 submitted Rockstar Dough LLC’s Form 1120-S for tax year
2020 that intentionally and falsely underreported Rockstar Dough LLC’s
gross receipts to qualify for the loan. On May 26, 2021, Rockstar Dough
LLC received a deposit of $526,000 from SBA’s Restaurant Revitalization
Fund into its Wells Fargo business bank account ending in -7285.

h. On May 3, 2021, UCC-1 submitted a false Restaurant
Revitalization Fund loan application to the SBA via the Internet on
behalf of Chicken Feed LLC. As part of that application’s supporting
documents, UCC-1 made materially false representations in the loan
application to qualify for the funds. For instance, UCC-1 stated that
the loan would be used for “business payroll costs,” “business rent,”
and “business food and beverage expenses.” On May 24, 2021, Chicken Feed
LLC received a deposit of $734,867 from the SBA’s’ Restaurant

Revitalization Fund into its Wells Fargo business bank account ending

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Case 3:23-cr-00965-RBM Document 58 Filed 02/02/24 PagelD.369 Page 9 of 22

in -7285. Instead of using the money for the stated purpose, on May 26,
2021, UCC-1 withdrew $734,000 from the account ending in -7285 via a
cashier's check payable to UCC-1 and SUEL.

i. On June 23, 2022, SUEL and UCC-1 concealed $2,421,345 in
U.S. currency in their residence.

All in violation of Title 18, United States Code, Section 1349.

Counts 2-5

[Wire Fraud - 18 U.S.C. §§ 1343 & 2]

25. Paragraphs 1 through 18 and 21 through 24 of the Superseding
Indictment are re-alleged and incorporated by reference.

26. Between in or about March 2020 and July 2021, within the
Southern District of California, and elsewhere, defendant LERONCE SUEL
and UCC-1, did knowingly devise and intend to devise a scheme and
artifice to defraud and to obtain money and property by means of false
and fraudulent pretenses, representations, and promises, and for the
purpose of executing a scheme for obtaining money by means of false and
fraudulent pretenses, representations, and promises, did knowingly
transmit and cause to be transmitted by means of a wire communication
into interstate commerce certain writings, signs, signals, and pictures

as more particularly described in the following table:

Count Date Interstate Wire
2 January 14, Submission of a Second Draw Paycheck
2021 Protection Program Loan Application on

behalf of Rockstar Dough LLC, causing an
interstate wire.

3 January 14, Submission of a Second Draw Paycheck

2021 Protection Program Loan Application on
behalf of Chicken Feed LLC, causing an
interstate wire.

4 July 15, 2021 | Submission of a First Draw Paycheck
Protection Program Loan Forgiveness
Application on behalf of Rockstar Dough LLC,
causing an interstate wire.
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Case 3:23-cr-00965-RBM Document58 _ Filed 02/02/24 PagelD.370 Page 10 of 22

Count Date Interstate Wire

5 July 15, 2021 | Submission of a First Draw Paycheck
Protection Program Loan Forgiveness
Application on behalf of Chicken Feed LLC,
causing an interstate wire.

All in violation of Title 18, United States Code, Sections 1343 and 2.

Count 6

[Money Laundering Conspiracy - 18 U.S.C. § 1956(h)]
27. Paragraphs 1 through 18, 12 through 24 of the Superseding

Indictment are re-alleged and incorporated by reference.

28. From on or about May 12, 2020 through May 27, 2021, within the
Southern District of California, and elsewhere, defendant LERONCE SUEL
and UCC-1 did knowingly combine, conspire, and agree with each other to
commit offenses against the United States in violation of Title 18,
United States Code, Section 1956, to wit: to knowingly conduct and
attempt to conduct financial transactions affecting interstate commerce
and foreign commerce, which transactions involved the proceeds of
specified unlawful activity, that is, Title 18, United States Code,
Section 1349 and 1343, knowing that the transactions were designed in
whole or in part to conceal and disguise the nature, location, source,
ownership, and control of the proceeds of specified unlawful activity,
and that while conducting and attempting to conduct such financial
transactions, knew that the property involved in the financial
transactions represented the proceeds of some form of unlawful activity,
in violation of Title 18, United States Code, Section 1956 (a) (1) (B) (i).

29. The manner and means used to accomplish the objectives of the
conspiracy included, among others, the following individual financial

transactions:

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Case 3:23-cr-00965-RBM Document 58

Filed 02/02/24 PagelD.371

Date Monetary Transaction

May 12, 2020 $20,000 cash withdrawal from
Rockstar Dough LLC’s Wells Fargo
account -9744

May 18, 2020 $20,000 cash withdrawal from
Rockstar Dough LLC’s Wells Fargo
account -9744

May 21, 2020 $20,000 cash withdrawal from
Chicken Feed LLC’s Wells Fargo
account -7285

June 1, 2020 $20,000 cash withdrawal from
Chicken Feed LLC’s Wells Fargo
account -7285

June 29, 2020 $45,000 cash withdrawal from
Chicken Feed LLC’s Wells Fargo
account -7285

July 7, 2020 $45,000 cash withdrawal from
Chicken Feed LLC’s Wells Fargo
account -7285

March 22, 2021 | $957,966 cash deposit into Rockstar
Dough LLC's Wells Fargo account -
9744

March 22, 2021 | $972,792 wire transfer from
Rockstar Dough LLC’s Wells Fargo
account -9744 to City Title N
Closing escrow account for the
purchase of real property located
3899 N Dogwood Canyon Loop,
Fayetteville, AR 72704

March 30, 2021 | $181,498 cash withdrawal from
Chicken Feed LLC’s Wells Fargo
account -7285

March 30, 2021 | $181,498 cash deposit into Rockstar
Dough LLC’s Wells Fargo account -
9744

April 26, 2021 | $150,000 cash withdrawal from
Rockstar Dough LLC’s Wells Fargo
account -9744

May 26, 2021 $734,000 withdrawal from Chicken
Feed LLC’s Wells Fargo account -
7285

May 27, 2021 $600,000 withdrawal from Rockstar
Dough LLC’s Wells Fargo account -
9744.

All in violation of Title

[Money Laundering Conspiracy - 18 U.S.C.

30. Paragraphs 1 through 18,

18, United States Code,
Count 7

Indictment are re-alleged and incorporated by reference.

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Sections 1956(h).

21 through 24 of the Superseding
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Case 3:23-cr-00965-RBM Document 58

Filed 02/02/24 PagelD.372 Page 12 of 22

31. From on or about May 12, 2020 through May 27, 2021, within the

Southern District of California, and elsewhere, defendant LERONCE SUEL
and UCC-1 did knowingly combine, conspire, and agree with each other to
commit offenses against the United States in violation of Title 18,
United States Code, Section 1956 and Section 1957, to wit: to knowingly
in monetary transactions by,

engage and attempt to engage, through or

to a financial institution, affecting interstate and foreign commerce,
in criminally derived property of a value greater than $10,000, that is
and transfer of U.S.

withdrawal, currency or monetary

the deposit,
instruments, such property having been derived from a specified unlawful
activity, that is, Title 18, United States Code, Sections 1343 and 1349,

Section 1957.

in violation of Title 18, United States Code,

32. The manner and means used to accomplish the objectives of the

conspiracy included, among others, the following individual financial

transactions:

Date
May 12, 2020

Monetary Transaction

$20,000 cash withdrawal from
Rockstar Dough LLC’s Wells Fargo
account -9744

$20,000 cash withdrawal from
Rockstar Dough LLC’s Wells Fargo

May 18, 2020

account

-9744

May 21, 2020

$20,000
Chicken
account

cash withdrawal from
Feed LLC’s Wells Fargo
~7285

June 1, 2020

$20,000
Chicken
account

cash withdrawal from
Feed LLC’s Wells Fargo
-7285

June 29, 2020

$45,000
Chicken
account

cash withdrawal from
Feed LLC’s Wells Fargo
-7285

July 7, 2020

$45,000
Chicken
account

cash withdrawal from
Feed LLC’s Wells Fargo
-7285

March 22, 2021

$957,966 cash deposit into Rockstar
Dough LLC’s Wells Fargo account -

9744

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Case 3:23-cr-00965-RBM Document 58 Filed 02/02/24 PagelD.373 Page 13 of 22

Date Monetary Transaction
March 22, 2021 | $972,792 wire transfer from
Rockstar Dough LLC’s Wells Fargo
account -9744 to City Title N
Closing escrow account for the
purchase of real property located
3899 N Dogwood Canyon Loop,
Fayetteville, AR 72704
March 30, 2021 | $181,498 cash withdrawal from
Chicken Feed LLC’s Wells Fargo
account ~-7285
March 30, 2021 | $181,498 cash deposit into Rockstar
Dough LLC’s Wells Fargo account -
9744
April 26, 2021 | $150,000 cash withdrawal from
Rockstar Dough LLC’s Wells Fargo
account -9744
May 26, 2021 $734,000 withdrawal from Chicken
Feed LLC’s Wells Fargo account -
7285
May 27, 2021 $600,000 withdrawal from Rockstar
Dough LLC’s Wells Fargo account -
9744.

All in violation of Title 18, United States Code, Section 1956 (h).

Count 8
[Conspiracy to Defraud the United States - 18 U.S.C. § 371]

33. Paragraphs 1 through 18, and 21 through 24 of the Superseding
Indictment are re-alleged and incorporated by reference.

34. From in or about March, 2020, and continuing until in or about
March, 2023, within the Southern District of California, and elsewhere,
defendant LERONCE SUEL and UCC-1, did unlawfully, voluntarily,
intentionally, and knowingly conspire, combine, confederate, with other
individuals known and unknown to the Grand Jury to defraud the United
States by impeding, impairing, obstructing, and defeating the lawful
government functions of the Internal Revenue Service of the Department
of Treasury in the ascertainment, computation, assessment, and
collection of the revenue: namely, personal income tax and employment

taxes of Rockstar Dough LLC and Chicken Feed LLC.

//

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Case 3:23-cr-00965-RBM Document 58 Filed 02/02/24 PagelD.374 Page 14 of 22

Manner and Means:

35. The defendant sought to accomplish the objects of the
conspiracy through the following manner and means, among others:

a. ucc-1 underreported the business gross receipts for years
2020 and 2021 on financial statements relied upon by Accountant 1. SUEL
and UCC-1 then filed and caused to be filed Forms 1120-S for 2020 with
false gross receipts figures.

b. In addition to false gross receipts figures, SUEL gave
Accountant 1 false information about his personal pay and employment
taxes. When filing amended and original returns in 2023, SUEL gave
Accountant 2 false information about business expenses and depreciable
assets affecting tax years 2014 through 2021.

Cc. SUEL paid or cause to be paid personal expenses out of
the business bank accounts. SUEL also paid himself in cash and withdrew
and caused to be withdrawn cash from business accounts which was then
stored in his personal residence. SUEL failed to keep contemporaneous
records of these transactions and to the extent they created taxable
income, SUEL did not report his income on his individual income tax
returns.

d. The Restaurant Group paid certain employee wages in cash
and cashier’s checks. SUEL and UCC-1 failed to withhold and pay over
employment taxes from these wages.

Overt Acts:

36. In furtherance of the conspiracy, and to effect the objects
thereof, the defendant and UCC-1 committed or caused to be committed the

following overt acts within the Southern District of California, and

elsewhere:

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Case 3:23-cr-00965-RBM Document 58 Filed 02/02/24 PagelD.375 Page 15 of 22

a. For tax year 2020, UCC-1 sent a fraudulent profit and
loss statement to Accountant 1 for Rockstar Dough LLC, who relied upon
this fraudulent profit and loss statement to prepare Rockstar Dough
LLC’s Form 1120-S.

b. On or around April 14, 2021, SUEL and UCC-1 caused
Rockstar Dough LLC to file a Form 1120-S with the IRS for tax year 2020.
On that form, Rockstar Dough LLC reported its gross receipts were
$675,026 and that its ordinary business loss was $619,896. However, SUEL
knew that Rockstar Dough LLC received gross receipts totaling at least
$2,452,511 as reported on Forms 1099-K or at least $2,354,482 as reported
on Rockstar Dough LLC’s point of sales (POS) system.

Cc. For tax year 2021, UCC-1 sent a fraudulent profit and
loss statement to Accountant 1 for Rockstar Dough LLC, who relied upon
this fraudulent profit and loss statement to prepare Rockstar Dough’s
Form 1120-S.

dad. On or about June 20, 2022, SUEL and UCC-1 approved a
draft Rockstar Dough LLC Form 1120-S for tax year 2021 that reported
gross receipts of $805,828 and that its ordinary business loss was
$727,636. However, SUEL knew that Rockstar Dough LLC received gross
receipts totaling at least $2,315,819 as reported on Forms 1099-K or at
least $2,256,430 as reported on Rockstar Dough LLC’s POS system.

e. In or around September 2022, SUEL and UCC-1 engaged
Accountant 2 to prepare amended and original business and individual tax
returns. SUEL and UCC-1 provided false information to Accountant 2. In
or around March 2023, SUEL signed the Rockstar Dough LLC and Chicken

Feed LLC tax returns and filed and caused to be filed false tax returns,

including, but not limited to:
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Case 3:23-cr-00965-RBM Document 58 Filed 02/02/24 PagelD.376 Page 16 of 22

i. The Rockstar Dough LLC amended Form 1065 for tax
year 2014 that listed over $285,000 in unknown
expenses, including over $178,000 in false
construction expenses.

ii. The Chicken Feed LLC Form 1065 for tax year 2016 and
amended Form 1065 for tax year 2017 that included
approximately $840,834 of false depreciable assets.

iii. The Chicken Feed LLC Form 1065 for tax year 2016 and
amended Forms 1065 for tax years 2017 and 2018 that
claimed false depreciation expenses and losses.

iv. The Chicken Feed LLC amended Form 1120-S for tax
year 2020 and Form 1120-S for tax year 2021 that
included $111,289 and $146,528, respectively, in
false rent deductions.

£. As a result of the false business tax returns set forth
in paragraph 36(e), in or around March 2023, SUEL filed and caused to
be filed Forms 1040 for tax years 2014 through 2021 that included
underreported flow-through income from the Restaurant Group and false
net-operating losses.

g. SUEL and UCC-1 withdrew millions of dollars in cash from
the Restaurant Group bank accounts, including, but not limited to:

i. During tax year 2020, approximately $696,330.

ii. During tax year 2021, approximately $1,984,840.

iii. During tax year 2022, approximately $140,000.
h. SUEL paid himself in cash from the Restaurant Group and
did not process the pay through payroll or report it on the Restaurant

Group financial statements.

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Case 3:23-cr-00965-RBM Document 58 Filed 02/02/24 PagelD.377 Page 17 of 22

i. SUEL and UCC-1 used Restaurant Group funds for personal
purposes and failed to report it as income, including, but not limited
to:

i. On March 22, 2021, SUEL and UCC-1 deposited
approximately $957,966 in cash into the Rockstar
Dough LLC bank account ending in -9744. The same
day, a $972,792 wire transfer from bank account
ending in -9744 purchased the real property titled
in SUEL’s name located 3899 N Dogwood Canyon Loop,
Fayetteville, AR 72704.

ii. Between July 2021 and March 2023, SUEL paid $58,100
in rent expenses for his personal residence from
Rockstar Dough LLC bank account ending in -9744.

iii. Between August 2021 and May 2023, SUEL and UCC-1
paid $22,000 in car payments for the vehicle driven
by SUEL from Rockstar Dough LLC bank account ending
in -9744,

iv. On June 23, 2022, SUEL and UCC-1 concealed
$2,421,345 in U.S. currency in their residence.

v. On October 12, 2022, SUEL withdrew approximately
$9,187.74 from Chicken Feed LLC account ending in -
7285 and deposited it into his personal bank account
ending in -3785. On October 13, 2022, SUEL paid
$9,187.75 in property taxes from his personal
account.

j- In or around April 2020, UCC-1 began paying some
employees by cashier’s check and cash instead of processing their pay

through the payroll service.

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Case 3:23-cr-00965-RBM Document58_~ Filed 02/02/24 PagelD.378 Page 18 of 22

k. For the following quarters, SUEL and UCC-1 caused the
payroll service to file false Forms 941 and failed to withhold and pay
over to the IRS the employment taxes due on the cash wages paid during

these quarters.

Quarter Form 941 Due Cash Wages
Date
2Q 2020 July 31, 2021 $97,673
3Q 2020 October 31, 2021 $97,103
4Q 2020 January 31, 2021 $30,060
1Q 2021 April 30, 2021 $32,963
2Q 2021 July 31, 2021 $27,647
3Q 2021 October 31, 2021 $21,385
40 2021 January 31, 2022 $8,490
l. On or around April 5, 2021, SUEL entered an engagement

with Accountant 1 to apply for the Employee Retention Credit (ERC). SUEL
made false statements about the Restaurant Group’s revenue and receipt
of COVID-19 relief funds to make it appear that they qualified for the
ERC program.
All in violation of Title 18, United States Code, Section 371.
Count 9
[Tax Evasion ~- 26 U.S.C. § 7201]

37. Paragraphs 1 through 18, 21 through 24, and 35 through 36 of
the Superseding Indictment are re-alleged and incorporated by reference.

38. During the calendar year 2020, defendant LERONCE SUEL, a
resident of San Diego, California, received taxable income, upon which
there was income tax due and owing to the United States of America.

Knowing the foregoing facts and failing to make an income tax return on

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Case 3:23-cr-00965-RBM Document58_ Filed 02/02/24 PagelD.379 Page 19 of 22

or before May 17, 2021, and to pay the income tax to the Internal Revenue
Service, defendant LERONCE SUEL, from on or about January 1, 2020 to
March 16, 2023 within the Southern District of California, and elsewhere,
wilifully attempted to evade and defeat income tax due and owing by him
to the United States of America for the calendar year 2020, by committing
the following affirmative acts, among others:

a. The acts described in paragraphs 36b, 36e, 36f, 36g 36h,

and 361 of this Indictment.

All in violation of Title 26, United States Code, Section 7201.

Counts 10-11

[Filing a False Tax Return - 26 U.S.C. § 7206(1)]

39. Paragraphs 1 through 18, 21 through 24, 35 through 36 of the
Superseding Indictment are re-alleged and incorporated by reference.

40. On or about the dates set forth below, within the Southern
District of California, and elsewhere, defendant LERONCE SUEL willfully
made and subscribed and filed and caused to be filed with the Internal
Revenue Service, the following false U.S. Individual Income Tax Returns,
Forms 1040, for the calendar years set forth below, which were verified
by a written declaration that they were made under penalties of perjury
and which defendant LERONCE SUEL did not believe to be true and correct
as to every material matter. The tax returns reported false losses from
Chicken Feed LLC and false taxable income in the amounts set forth below,
whereas, defendant LERONCE SUEL knew, the losses that reduced his taxable
income were false, and his taxable income was greater than the amount

reported.

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Case 3:23-cr-00965-RBM Document 58 Filed 02/02/24 PagelD.380 Page 20 of 22

Count | Approximate Year | False Items
Filing Date

10 July 3, 2023 2016 |a. Line 17, Rental real estate,
royalties, partnerships, §S
corporations, trusts, $-217,932

b. Line 22, Total income, $-217,914
a. Line 21, Other income, $-189,042
11 June 19, 2023 / 2017 |, Line 22, Total income, $-451,822

All in violation of Title 26, United States Code, Section 7206(1).
Count 12
[Failure to File - 26 U.S.C. § 7203]

41. During the calendar year 2018, defendant LERONCE SUEL, a
resident of San Diego, California, had and received gross income in
excess of $12,000. By reason of such income, he was required by law,
following the close of calendar year 2018, and on or before April 17,
2019, to make an income tax return to the Internal Revenue Service,
stating specifically the items of his gross income and any deductions
and credits to which he was entitled. Knowing and believing all of the
foregoing, he did willfully fail, on or about April 17, 2019, within the
Southern District of California, to make an income tax return.

All in violation of Title 26, United States Code, Section 7203.
Count 13
[Failure to File - 26 U.S.C. § 7203]

42. During the calendar year 2019, defendant LERONCE SUEL, a
resident of San Diego, California, had and received gross income in
excess of $12,200. By reason of such income, he was required by law,
following the close of calendar year 2019, and on or before July 15,
2020, to make an income tax return to the Internal Revenue Service,
stating specifically the items of his gross income and any deductions

and credits to which he was entitled. Knowing and believing all of the

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Case 3:23-cr-00965-RBM Document 58 Filed 02/02/24 PagelD.381 Page 21 of 22

foregoing, he did willfully fail, on or about July 15, 2020, within the
Southern District of California, to make an income tax return.

All in violation of Title 26, United States Code, Section 7203.

FORFEITURE ALLEGATION

43. The allegations contained in Counts 1 through 7 of this
Superseding Indictment are hereby realleged and incorporated by
reference for the purpose of alleging forfeitures pursuant to Title 18,
United States Code, Sections 981(a) (1), 982(a) (1), and 982(a)(2) and
Title 28, United States Code, Section 2461({c).

44. Upon conviction of the offenses in violation of Title 18,
United States Code, Sections 1343, 1349, or 1956 set forth in Counts 1
through 7 of this Indictment, defendant LERONCE SUEL, shall forfeit to
the United States of America, pursuant to Title 18, United States Code,
Sections 981(a) (1), 982(a) (1), and 982(a) (2), and Title 28, United
States Code, Section 246l1(c), any property, real or personal, which
constitutes or is derived from proceeds traceable to the offense(s).
The property to be forfeited includes, but is not limited to, the
following:

a. Real property located at 3899 N Dogwood Canyon Loop,
Fayetteville, AR 72704 with parcel number 177-00050-000.

b. $2,421,345.00 in U.S. currency seized from defendant’s
residence on June 23, 2022.

45. If any of the property described above, as a result of any act

or omission of the defendant:
a. cannot be located upon the exercise of due diligence;
b. has been transferred or sold to, or deposited with, a
third party;

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Case 3:23-cr-00965-RBM Document58- Filed 02/02/24 PagelD.382 Page 22 of 22

om has been placed beyond the jurisdiction of the court;
d. has been substantially diminished in value; or
e. has been commingled with other property which cannot be

divided without difficulty,
the United States of America shall be entitled to forfeiture of
substitute property pursuant to Title 21, United States Code,
Section 853(p), as incorporated by Title 28, United States Code,
Section 2461(c).
All pursuant to Title 18, United States Code, Sections 981(a)(1)(C),
982 (a) (1), and 982(a) (2), and Title 28, United States Code,

DATED: February 2, 2024.

A TRUE BILL:

TARA K. McGRATH
United States Attorney

By: \) a =
E<7CHRISTOPHER BEELER
Assistant U.S. Attorney
JULIA M. RUGG
Special Assistant U.S. Attorney

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