Hank Investigates: Taxing Times

MALDEN, MASS. (WHDH) - Local small businesses tell Hank Phillippi Ryan they’re out tens of thousands of dollars! They say the company they all hired to pay their taxes, didn’t do it.

Malden restaurant owner George Lambos struggled to keep his doors open during the pandemic.

“It was tough. The first couple weeks were a little scary,” Lambos told 7 Investigates.

His Fresco’s Roast Beef & Seafood kept people employed, serving up specialties like the Fisherman’s Combo, the Big Beef, and lobster rolls.

“Everyone was saying thank you for staying open,” Lambos said.

But now George says he’s facing another financial battle.

He used a company called Northeast Abacus, Incorporated, to handle payment of his restaurant’s federal and state taxes.

When he got government notices saying those taxes weren’t paid, he called the company in a panic.

“She was always assuring me it was paid. She told me that it’s settled and there’s no monies owed,” George said.

But he says that turned out to be wrong. The company had not paid all his taxes. And George is now on the hook for nearly $130,000.

“What do you think now?”  Hank asked.

“It’s terrible,” George said.

Our investigation found George isn’t the only New England business owner forced to pay state and federal taxes again!

“It’s probably one of the worst things that could have happened,” Joe Lahoud, owner of the Milford Pizza Palace said.

He also used Northeast Abacus Incorporated to handle his taxes and got this email saying the company was “unable to process” Joe’s financial transactions “due to unforeseen circumstances.”

When he called the company’s number, it was disconnected.

He says he now owes $15,000 in taxes!

“I actually got physically ill,” Lahoud said.

We’ve learned the owners of Northeast Abacus Incorporated have now filed for bankruptcy.

These court documents reveal they owe 1.8 million dollars — to banks, creditors, and more than two dozen local businesses.

Many owners tell 7 Investigates they are now left in the lurch.

“It’s disgusting,” Lambos said.

We tried contacting the company’s owners and its bankruptcy attorney and got no response.

The Department of Revenue says it’s “aware of this situation and working with impacted businesses.”

Meantime these restaurants, already taxed with unprecedented times, must scramble even harder to stay afloat and pay their taxes again.

“It’s just its heart-wrenching. It really is,” Lahoud said.

We’ve learned the Essex County district attorney’s office has now filed charges of larceny and embezzlement against one of the operators of the company.

Whether the small businesses will be able to recover their money is still up in the air.

If you have a story idea for 7 Investigates please email TellHank@whdh.com

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