TOLEDO, OH (WFIE) -
Eighteen people have been indicted on charges related to raids at IHOP restaurants in Evansville and Toledo, OH in September of 2011.
FBI agents, and other federal authorities were stationed outside the IHOP Restaurant on Burkhardt Road. They seized boxes of documents at the Evansville location and 6 other IHOPs, most in Ohio.
The 64 count indictment unsealed Wednesday morning names 18 people in a massive conspiracy to defraud the government and IHOP's corporate owner, Dine Equity, and contains charges including identity theft, alien harboring, mail fraud and wire fraud. The suspects are expected to be arraigned in Federal Court in Toledo Wednesday afternoon.
At the center of the investigation is Tarek Elkafrowi, also known as Terry Elks. Elkafrowi owns 7 IHOP restaurants, including one in Evansville and six others in Ohio, all of which were raided last September.
IHOP on Burkhardt closed at 10 PM Wednesday night, and it is scheduled to reopen Thursday morning at 6 AM. Employees say it's closed from regular maintenance, but federal authorities say the restaurant's owner is in custody. Investigators say he was serving up more than just breakfast.
"We allege that the pancake houses were a front for a much more behind the scenes operation," said Tom Harter with Homeland Security out of Cleveland.
"The crimes that are laid out in this 64 count indictment resulted in losses in excess of $3 million, and the victims of these various schemes of fraud are almost as numerous as the fraud schemes," said Carole Rendon, the First Assistant U.S. Attorney for the Northern District of Ohio.
The indictment alleges Elkafrowi manipulated sales figures in order to avoid paying taxes and steal from IHOP. According to the indictment, Elkafrowi and two others took more than $1.2 million in unreported income. The indictment also alleges the restaurant hired more than 200 illegal aliens. FBI agents say he would recruit illegal workers, supply them with fake documents and instruct managers to cash their payroll checks in the store.
You can read the 65 page indictment here
Elkafrowi is also accused of ordering the Findlay, Ohio IHOP location be set on fire intentionally. Elkafrowi then submitted a $1.4 million fraudulent insurance claim, according to court documents.
"They had a menu of various criminal schemes," said Rendon.
Tarek Eid Omar, the manager of Evansville's IHOP, is also implicated in some of the criminal activities.
Federal agents say it was all about the money. Authorities say that cash was put into bank accounts, spent on cars and homes. Officials called it a massive conspiracy and say it's time justice is served.
"It is our aim to make sure this group gets their next helping of pancakes from the behind the counter of a federal prison cafeteria," said Harter.
Federal authorities say the investigation took 3 years.
The indictment states that all 7 IHOP restaurants owned by Elkafrowi have been seized by the federal government.
The IHOP restaurants formerly owned by Elkafrawi and others, raided in September of 2011 and now under the control of the federal government are located at:
- 601 N. Burkhardt Rd. in Evansville, IN
- 4045 Talmadge Rd. in Toledo, OH
- 6535 Airport Highway in Holland, OH
- 7777 Township Rd. in Findlay, OH
- 6920 W. Central Ave. in Toledo, OH
- 10151 Fremont Pike in Perrysburg, OH
- 3289 Elida Rd. in Lima, OH
The raids took place in September of 2011. Several locations were raided in northwest Ohio and southeast Indiana. Agents removed many boxes of documents, but the investigation had remained sealed until Wednesday.
Officials say the arrests were made around 6 a.m. Wednesday.
Arrested were:
- Tarek Elkafrawi
- Tarek Eid Omar (the manager of Evansville's IHOP)
- Autumn Lee Tangas
- Kelly Elkafrawi
- Jose Leon-Gonzalez (aka Jose Leon, aka Jose Vargas, aka Juan Vargas, aka Edwin Martel)
- Carlos Gamboa
- Khaled Yousef
- Jamil Mohammed Awwad
- Ramiz Awwad
- Khalil Aboudakka
- Mohamed Ali
- Mohamed Hassan
- Donna J. Harriott
- Lucky Williams
- Sara Rinebolt
- Cesar Avila
- Mark Anthony Turner
- Yoni Merida
Most of the IHOP restaurants were open Wednesday and apparently operating as normal, with one exception, at one of the Ohio restaurants.
The IHOP located on Central Avenue is currently closed. The doors are locked and it appears as though no one is inside the restaurant. Someone by phone told Toledo News Now's Cristy Gimbel the store is expected to reopen Wednesday afternoon.
IHOP restaurants located on Talmadge Road and Airport Highway, along with in Perrysburg, Findlay and Evansville, IN said they are open for business.
Some customers were frustrated and surprised with the closing of IHOP.
"Having the police here and having it closed and having investigations going on, that's sort of disturbing a little bit, because I think IHOPs, in general, are very good places to eat, you know. Like I said, they've got good food and they've got good service," said George Court.
Federal authorities say the indictment does not show any ties to terrorism organizations.
Federal authorities say they are now seeking ownership of the seven IHOP franchises, homes, cars, and bank accounts directly related to the investigation.
We are told that IHOP corporate will likely take over the running of the restaurants.
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