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Detroit Strip club owner's cheating cost him $1.8 million — and more

shadowcat

Atlanta suburb

The one-time owner of Detroit's largest strip club has admitted to making some big financial missteps that will cost him $1.8 million, plus his freedom.

Walled Lake businessman Johni Semma, a restaurateur and former owner of The Coliseum — a massive, Egyptian-themed strip club on 8 Mile — pleaded guilty this week to cheating the government out of taxes and failing to file a tax return in 2012. Under the terms of his plea deal, he faces 30-36 months in prison when he is sentenced in January.


Semma's admitted crimes involved two of his businesses: the Bayside Sports Bar & Grille in Walled Lake, and The Coliseum in Detroit.

Semma admitted in U.S. District Court that he withheld about $1.3 million in taxes out of his restaurant employees' paychecks between 2008-2015, but never turned the employment taxes over to the Internal Revenue Service as mandated by law.


Semma also admitted to willfully failing to file a tax return in 2012, the same year he sold The Coliseum for about $5.9 million. By not filing an income tax return, prosecutors said, he cost the government $463,000 in tax losses.

In the end, Semma's criminal activity cost the government $1.79 million in losses — all of which he has been ordered to pay back in restitution.

According to the indictment, Semma sold the Coliseum for more than $6 million — more than half of which was paid for in 2012. Prosecutors allege that Semma received $3.5 million in 2012 from the sale of the Coliseum, but never filed a 2012 income tax return.

Semma's guilty plea spares him from a potentially lengthy prison sentence. He was initially charged with 24 counts of failing to account for and pay employment taxes. Each count carries up to five years in prison.

In the end, Semma pleaded guilty to only one count. Typically, prosecutors drop the remaining charges at sentencing in exchange for the defending entering into a plea agreement.