Area strip club operators face tax evasion charges

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Not only did the father-son operators of Blackjacks Gentleman’s Club fail to pay taxes on about $4 million in fees they collected from their dancers, but they also ran an illegal Internet gambling service from their homes that netted another $400,000, according to federal prosecutors. February 2, 2012 | Michael Smart~Sun-Times Media

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Updated: April 3, 2012 1:57AM

ELGIN TOWNSHIP — Strippers who strutted their stuff for tips at Blackjacks Gentleman’s Club paid the club’s father-and-son operators nearly $4 million in fees, federal prosecutors say.

But Anthony Buttitta, 42, and his dad, Dominic Buttitta, 69, allegedly never paid a cent of tax on the income.

And the father and son team had a lucrative sideline, prosecutors say: an illegal Internet gambling service that netted them another $400,000.

They used their ill-gotten gains to try to buy a luxury condominium in Las Vegas and a home in Costa Rica, according to court papers filed by the U.S. Attorney’s office.

Both the younger Buttitta, of St. Charles, and the older, of South Barrington, are charged with conspiracy to defraud the IRS and operating an illegal gambling business.

According to the government’s allegations, the Buttittas collected $3.7 million in “house fees” from dancers at the strip club on route 25 just southeast of South Elgin between January 2002 and December 2009 — an average of $1,500 a night. They destroyed logs detailing the payments, prosecutors alleged.

Between 2005 and 2009, they also ran gambling websites including Skybook.com, Largejoe.com, and Theredhotel.com, prosecutors said.

Both are accused of filing false federal corporate tax returns for 2002-09, and false individual returns for 2002-08. They diverted money from the businesses to personal use and concealed it from their tax preparers and the IRS, prosecutors alleged.

The money was then used to attempt to buy a $2.9 million condominium in Las Vegas and a second condo in Costa Rica, as well as pay off personal credit cards, prosecutors alleged. Anthony Buttitta allegedly used another $400,000 to build his home in St. Charles,

The Buttittas also placed employees of the Internet gambling business on the payroll of another company to give the appearance of a legitimate business, and in return received cash kickbacks, which they also concealed from tax preparers, bookkeepers and the IRS, prosecutors alleged.

They received about $1 million in gross wagers from the gambling business between 2005 and 2009, about $400,000 of that being profits, prosecutors say. The government is seeking forfeiture of that $400,000.

Each count carries a maximum penalty of five years in prison and a $250,000 fine, plus restitution, back taxes, interest and penalties.

Calls to the Buttittas and the club, which is advertised as “one of the top 100 gentlemen’s clubs in the U.S.,” were not returned Thursday.