After a grand jury investigation Tuesday, the owner of the Hollywood Palms movie theater was charged with more than 100 counts of felony tax evasion, fraud and failure to file tax returns, according to a press release from the Illinois Department of Revenue.
Edward Charles Bulthaup III was arrested Wednesday after Illinois Department of Revenue Criminal Investigations Division agents testified before a grand jury Tuesday.
“When a local businessman evades his responsibilities to pay taxes, it hurts the community, it hurts the state, and it causes every taxpayer to have to reach a little deeper to help pay the bills,” said Brian Hamer, director of revenue, in the release.
Agents searched two locations of his business in February: Hollywood Boulevard, DBA Hollywood Boulevard, 1001 E. 75th St., Woodridge; and Naperville Theater, DBA Hollywood Palms, 352 S. Route 59, Naperville. The Hollywood Boulevard location in Woodridge was purchased by Hobson Financial Group just days after the searches were completed. A Feb. 25 hearing gave final clearance for Hollywood Blvd. to be purchased by Hobson Financial Group of Illinois Inc., after a Jan. 31 public auction, court documents show.
The findings of the two searches were reported to the grand jury Tuesday. Records and computer information were seized, according the release. The Naperville Police Department also assisted. The investigations resulted in two separate multiple count indictments Tuesday.
The charges resulting from the searches at each theater, along with the minimum tax liability associated with each charge are as follows:
Hollywood Boulevard
1 count sales tax evasion — Class 1 Felony
6 counts sales tax evasion — Class 2 Felony
41 counts of fraudulent filing of Illinois sales and use tax returns — Class 3 felonies
1 count of mail fraud — Class 3 felony
1 count wire fraud — Class 3 felony
3 counts failure to file Illinois sales and use tax return — Class 3 felonies
(53 counts)
Hollywood Palms
1 count sales tax evasion — Class 1 Felony
8 counts sales tax evasion — Class 2 Felony
45 counts of Fraudulent Filing of Illinois Sales and Use tax returns — Class 3 felonies
1 count of Mail Fraud — Class 3 felony
1 count Wire Fraud — Class 3 felony
(56 Counts)
Susan Hofer, spokesperson for the Illinois Department of Revenue, said that the arrest was made almost a year later because of the volume of information gleaned from the searches.
“It took a while to go through the documents as well as things in the court system, but investigations can linger much longer than this,” Hofer said.
Hofer said the majority of the felony charges stem from not paying state sales tax, in addition to “use” taxes that have not been paid.
“When you go to a movie theater and buy a ticket — some of the price is the sales tax, which is a ‘trust tax’ and is supposed to be paid directly to the state and not wind up in the owner’s pockets,” she said. “We know that Mr. Bulthaup has had money problems — it’s a matter of public record that he filed bankruptcy for one of his theaters. He certainly can’t be surprised by what’s happened.”
Hofer said Bulthaup was arrested Wednesday morning in DuPage County. A bond hearing was held later in the day. Bulthaup was freed after a $250,000 bond was paid.