Tony Luke's cheesesteak owners sentenced for tax fraud scheme

The owners of the popular cheesesteak restaurant Tony Luke's in South Philadelphia have been sentenced to nearly two years in prison for tax fraud, according to the Department of Justice.

Nicolas Lucidonio, 57, and his father Anthony Lucidonio Sr., 84, both of New Jersey, have each been sentenced to 20 months in prison for what the DOJ says is a decade-long conspiracy to defraud the IRS.

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They had pleaded quilty back in May of 2022.

The two men are accused of hiding over $8 million in cash receipts and paying employees "off the books" using cash.

This all happened between 2006 and 2016 while the two owned and operated the Tony Luke's restaurant in South Philadelphia, officials said.

The Lucidonios only deposited a portion of the cash they received into the restaurant's bank accounts and then didn't provide the proper information to their accountant, prosecutors said.

The father-son duo also paid portions of their employee's wages with cash without reporting the full amount to the IRS., prosecutors said.

Officials said that these actions forced the accountant for Tony Luke's to file false tax returns and incorrect quarterly employment tax returns with the IRS.

“For a decade, these successful restaurateurs boldly cooked the books, cheating the government and honest taxpayers alike,” U.S. Attorney Jacqueline Romero said. “As this investigation and prosecution show, tax fraud is a crime with some pretty high stakes, with violators held fully accountable.”

In 2015, officials said that a dispute over franchising rights between the Lucidonios and another person had the two men worried that their tax evasion scheme would be revealed. In response to this, they worked to adjust the restaurant's tax returns from the previous year to show increased sales.

The DOJ reported that the tax fraud scheme by the Lucidonios meant that the United States lost over $1 million.

On top of the 20 months in prison, each of the men were ordered to serve three years under supervised release.