The co-owner of Riley’s Wines of the World and the Churchkey Bar & Grill was sentenced Tuesday to one year in federal prison and a $30,000 fine for fraudulent tax practices, according to federal court documents.
Jongyean Lee pled guilty Aug. 21 to the charge of submitting a false purchase journal to an IRS agent, a misdemeanor. The maximum penalty she faced was one year in jail, a year of supervised release and a $100,000 fine.
Jongyean Lee’s husband, Hyungirl Lee, also pled guilty to a felony charge in a separate incident for filing a fraudulent income tax return in 2005. In line with part of the couple’s plea agreement, Jongyean Lee will serve her prison term a week after the conclusion of her husband’s prison term, according to the court document.
Hyungirl Lee’s sentencing is set for Oct. 30, and he faces a maximum charge of three years in prison, a year of supervised release and a $250,000 fine.
In addition to Riley’s Wines of the World and Churchkey Bar and Grill, the couple also owns Badger Liquor and Vineyard Liquor. Jongyean Lee also owns local restaurant Samba Brazilian Grill on West Gilman Street.
In a memorandum to Judge Barbara Crabb, Jongyean attorney David Geier requested no prison term due to concerns the term could jeopardize her businesses in the city, which employs 150 people.
Central to the topic is the question of whether the misdemeanor charge threatens Jongyean Lee’s holding of her establishment’s liquor licenses for her businesses.
“If Jongyean Lee were incarcerated at the time of the liquor license renewal (June 30), it is an almost foregone conclusion that she will not keep the licenses,” Geier wrote in the memorandum.
A misdemeanor charge does not constitute an automatic restriction on holding a license, but a felony does, according to Assistant City Attorney Steve Brist.
Brist added the legal question involved is whether the offense relates to the license activity of the business. In addition, Brist said problems would arise in terms of liquor licenses when Jongyean Lee is imprisoned.
“As the agent, she would not be able to continue as agent from a practical standpoint,” Brist said.
Alcohol License Review Committee Chairman David Hart said in an e-mail to The Badger Herald the offense would have some impact on the decision to renew the licenses in Lee’s name during the annual renew time.
ALRC member Ald. Mike Verveer, District 4, said the basis for the ALRC’s decision on whether to grant or deny licenses rests on the question of whether the license would be contrary to public health and safety.
“Personally, it’s hard for me to make the jump from misdemeanor tax evasion to her businesses are contrary to the public health,” Verveer said.
Verveer also said he has not had any contact with Jongyean Lee, and his main concern lies with the jobs and livelihoods of her employees, many of whom are University of Wisconsin students.
