Five top executives from RCI Hospitality Holdings, a publicly traded company known for its strip clubs, have been indicted for a large-scale tax fraud and bribery scheme. This was announced by New York Attorney General Letitia James.
The allegations suggest that RCI executives offered bribes to a state Department of Taxation and Finance auditor. They reportedly provided him with 13 all-expenses-paid trips to Florida, including payments of up to $5,000 per day for private dances at RCI-owned clubs, such as Tootsie’s in Miami.
Timothy Winata, RCI’s controller, allegedly traveled from Texas to Manhattan multiple times to deliver hush money at RCI’s clubs, including Rick’s Cabaret and others. The bribes reportedly helped RCI avoid paying more than $8 million in state and city taxes from 2010 to 2024 by influencing six separate sales tax audits.
The charges reveal a concerning pattern. For example, following one trip in February 2022, the auditor texted Winata to express enjoyment of the visit, hinting at future trips. This exchange illustrates a troubling ease in which personal pleasure intertwined with a misuse of authority.
Eric Langan, RCI’s CEO, is accused of overseeing these bribery efforts, even texting associates about their tax struggles and bribes to resolve them. Alongside Langan, three other senior executives were charged, as well as the three implicated Manhattan clubs.
After the indictment announcement, RCI’s stock dropped nearly 17%. James stated, “RCI’s executives shamelessly used their strip clubs to bribe their way out of paying millions of dollars in taxes.”
RCI’s lawyer, Daniel Horwitz, responded by asserting the innocence of the company and its executives, emphasizing their commitment to contesting these charges. He pointed out that RCI has a history of transparency and adherence to tax laws, previously disclosing the ongoing investigation in its SEC filings.
Today, tax fraud cases like this underscore the need for corporate accountability. With increasing scrutiny on financial practices, these developments could motivate other companies to reassess their compliance measures.
For additional details, you can review New York’s official tax website here and the press release from the Attorney General’s office here.
Source link
Breaking News: Politics,RCI Hospitality Holdings Inc,Letitia James,Securities fraud,Laws,Crime,Politics,Business,Entertainment,Corruption,New York City,Collusion,New York,Eric Langan,business news
