State of Minnesota
County of Hennepin
District Court
Fourth Judicial District
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CCT
LIST CHARGE STATUTE ONLY
MOC
GOC
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289A.63
289A.63
289A.63
289A.63
289A.63
289A.63
Y1060
Y1060
Y1060
Y1510
Y1510
Y1510
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CTY ATTY
FILE NO.
CONTROLLING
AGENCY
CONTROL NO
13-1158
MN062025Y
12000682
COURT CASE NO.
Amended
if more than 6 counts (see attached)
DATE FILED
Tab Charge Previously Filed
if Domestic Assault as defined by MS 518B01, sub2a,b
State of Minnesota,
PLAINTIFF,
VS.
NAME: first, middle, last
SUSAN KERRY BEAMON
DEFENDANT,
SERIOUS FELONY
FELONY
GROSS MISDM DWI
SUMMONS
WARRANT
ORDER OF DETENTION
GROSS MISDM
EXTRADITION
Date of Birth
5/11/68
9336 THOMAS AVE N
BROOKLYN PARK, MN 55444
MNCIS #:
LE#:
SILS ID:
TRACK ID:
27-CR13-13772
740099
2639175
___________________________________________________________________________________________
___________________________________________________________________________________________
COMPLAINT
The Complainant, being duly sworn, makes complaint to the above-named Court and states that there is probable cause to believe that the
Defendant committed the following offense(s). The complainant states that the following facts establish PROBABLE CAUSE:
___________________________________________________________________________________________
___________________________________________________________________________________________
Your complainant, Gary Charboneau, is a Revenue Special Investigator in the Criminal Investigation Division
(CID) of the Minnesota Department of Revenue (MNDOR), and in that capacity I am familiar with tax procedures
and requirements of the State of Minnesota and have access to tax records for both individuals and business entities
in the State of Minnesota. Based on the foregoing information, I believe that there exists probable that Defendants
James Beamon and Susan Beamon have committed the crimes of failing to remit sales tax, filing fraudulent or false
tax returns, and failing to file required tax returns.
Background and Summary
On August 28, 2012, I met with Lieutenant Christopher Hildreth from the License Division for the Minneapolis
Police Department (MPD). He told me that he had information from employees and other people familiar with
Envy Nightclub (“Envy”) that Envy was “skimming” off of several cash only bars as well as the cover charge
enforced by the night club. He also shared the liquor license application and file for James and Susan Beamon (also
known as Susan Franks), the current owners of Envy. The Beamons do business as Grand Group Entertainment,
LLC (“Grand Group”) in their operation of Envy. The 2009 adjusted gross income (AGI) for James and Susan
filing jointly was negative $8,464.00. A 2010 unfiled tax return was obtained by Minneapolis Licensing Division.
That document showed a joint AGI of $595,369.00. The GenTax (the computer software used by MNDOR)
computer records show that the Beamons have not filed income tax returns with MNDOR since March, 2011, when
they filed their last return for 2009.
FORM-J
REV. 12/95
Page
2
Based on this information, a search warrant was obtained and executed at Envy Nightclub, 401 First Avenue North,
Minneapolis, Hennepin County, Minnesota on August 30, 2012. During the search, numerous records, cash, and
computers were seized. I also conducted interviews of Donna Hagestuen and Kimberly Tykwinsky, former
employees of Envy, as well as David Bartlett, a CPA who has worked for the Beamons.
Jurisdiction
The offenses discussed below relate to the Beamons’ conduct operating Envy Nightclub. During the time period
over which these offenses occurred, Envy Nightclub was located and operated at 401 First Avenue North,
Minneapolis, Hennepin County, Minnesota.
False or Fraudulent Returns
On a daily basis, a daily worksheet was filled out by hand which showed total sales, total credit card sales, cash
sales, front door totals (cover charge), and various payouts at Envy. According to Donna Hagestuen, an exemployee familiar with the daily worksheets, these worksheets accurately describe nightly sales totals. These
sheets show that from a combination of liquor and cover charges, Envy brought in a total of $119,257.24,
$107,786.53, and $101,138.70 in April, May, and June of 2012, respectively.
Minnesota Statute § 289A.18, subd. 4, requires James Beamon and Susan Beamon to file a monthly return with
MNDOR on or before the 20th day of the month for the prior month’s taxable gross sales. GenTax (a complete
integrated tax processing software used by MNDOR) can show the filing summary for these required monthly
filings, including Gross Receipts. These reports show reported gross receipts of $27,445, $32,777, and $27,621 for
April, May, and June of 2012. The table below shows the discrepancy between the reported and actual (according
to Envy’s own business records) sales during that three month period:
April
2012
May
2012
June
2012
Total
Actual
Sales (from
daily
worksheets)
Reported Sales
(from required
monthly
MNDOR filings)
Discrepancy
(underreported)
$119,257.24
$27,455
$91,802.24
$107,786.53
$32,777
$75,009.53
$101,138.70
$328,182.47
$27,621
$87,853
$73,517.70
$240,329.47
The Beamons underreported their sales by at least $73,000 for each of the months from April to June, 2012, totaling
$240,329.47 in unreported sales.
For these three months, Colleen Kelly (a Senior Revenue Tax Specialist with MNDOR) prepared an audit showing
what the tax liability would have been had Envy reported their actual sales. From this, she was able to show what
the unpaid tax liability was for those months, based on what GenTax showed was actually paid by the Beamons.
These are the results:
Page
April
2012
May
2012
June
2012
Total
Tax Due
(from audit)
Tax Paid (from
GenTax)
Unpaid
Sales Tax
Liability
$14,702.59
$3,643
$11,059.59
$13,301.90
$3,295
$10,006.90
$12,401.63
$40,406.12
$0
$6,938
$12,401.63
$33,468.12
3
The Beamons underpaid their taxes by over $10,000 for April, May, and June 2012, totaling $33,468.12 in unpaid
sales tax liability.
The MNDOR GenTax reports for Grand Group showed no sales tax filing or remittance listed for the months of
July, August, and September 2012. The daily worksheets are not complete for July, but show $23,355.98 in sales
for part of that month.
On August 22, 2005, the original filing for Behr Services, Inc. (Behr) was received by the Secretary of the State of
Minnesota. This organization is owned by its CEO, James Beamon. Behr was going to be the original shareholder
for Grand Group. However, David Bartlett informed the Beamons’ attorney that Behr could not be the registered
owner of Grand Group. Instead, the Beamons registered Grand Group with James Beamon owning 51% and Susan
Beamon owning 49%.
James Beamon opened a business checking account and business market rate savings account at Wells Fargo for
Behr. These accounts would receive cash deposits from James Beamon. The checking account received deposits
of $202,607.60 in 2011 and $306,493.58 in 2012. The savings account had deposits of $4,564.19 in 2011 and
$24,526.02 in 2012. These large cash deposits continued into August 2012.
On February 9, 2011, James Beamon opened two Wells Fargo business checking accounts and two business market
rate savings accounts for Grand Group. On August 30, 2011, James Beamon opened a business checking account
in the name of Envy. Bank statements for these accounts show automatic deposits from credit card transactions,
cash deposits, and online transfers. The withdrawals were for business related payments, personal cash
withdrawals, and personal items and bills by James Beamon. The deposits into these accounts are shown below:
2011 Deposits
Grand Group
Checking Account
Ending 6822
Grand Group
Checking Account
Ending 6830
Grand Group
Business Savings
Account Ending 7861
Grand Group
Business Savings
Account Ending 8273
Envy Checking
Account
2012 Deposits
$102,590.45
$26,336.40
$519,299.37
$615,380.34
$42,850.38
$5,104.01
$10,567.15
$6,097.01
$7,057.60
$9,049.00
Page
4
Conclusion
Based on the above facts, I believe that there is probable cause that James Beamon and Susan Beamon failed to file
required tax returns, filed fraudulent or false tax returns, and failed to remit required sales tax. Specifically, the
Beamons underreported their sales by an estimated $240,329.47 in the three months from April to June of 2012 and
as a result, unlawfully avoided an estimated $33,468.12 in sales tax liability.
OFFENSE
COUNT 1:
FILING A FALSE OR FRAUDULENT TAX RETURN (FELONY);
MINN. STAT. 289A.63, SUBD. 2(b); § 609.03(1); § 609.05
PENALTY: 0-5 YEARS AND/OR $10,000
That on or about May 21, 2012, in Hennepin County, Minnesota, SUSAN KERRY BEAMON, acting alone or
intentionally aiding, advising, hiring, counseling or conspiring with James Shelly Beamon, knowingly filed a
return, report, or other document known to be fraudulent or false concerning a material matter.
COUNT 2:
FILING A FALSE OR FRAUDULENT TAX RETURN (FELONY);
MINN. STAT. 289A.63, SUBD. 2(b); § 609.03(1); § 609.05
PENALTY: 0-5 YEARS AND/OR $10,000
That on or about June 20, 2012, in Hennepin County, Minnesota, SUSAN KERRY BEAMON, acting alone or
intentionally aiding, advising, hiring, counseling or conspiring with James Shelly Beamon, knowingly filed a
return, report, or other document known to be fraudulent or false concerning a material matter.
COUNT 3:
FILING A FALSE OR FRAUDULENT TAX RETURN (FELONY);
MINN. STAT. 289A.63, SUBD. 2(b); § 609.03(1); § 609.05
PENALTY: 0-5 YEARS AND/OR $10,000
That on or about July 20, 2012, in Hennepin County, Minnesota, SUSAN KERRY BEAMON, acting alone or
intentionally aiding, advising, hiring, counseling or conspiring with James Shelly Beamon, knowingly filed a
return, report, or other document known to be fraudulent or false concerning a material matter.
COUNT 4:
FAILURE TO FILE SALES TAX RETURN
MINN. STAT. § 289A.63, SUBD. 1(a); § 609.03(1); § 609.05
PENALTY: 0-5 YEARS AND/OR $10,000
That on or about July 2012, in Hennepin County, Minnesota, SUSAN KERRY BEAMON, a person required
to file a return, report, or other document regarding sales taxes due on retail sales activity with the
Commissioner of the Minnesota Department of Revenue, acting alone or intentionally aiding, advising,
hiring, counseling or conspiring with James Shelly Beamon, attempted to evade or defeat a tax by failing to
file a return, report or other document when required.
COUNT 5:
FAILURE TO FILE SALES TAX RETURN
MINN. STAT. § 289A.63, SUBD. 1(a); § 609.03(1); § 609.05
PENALTY: 0-5 YEARS AND/OR $10,000
That on or about August 2012, in Hennepin County, Minnesota, SUSAN KERRY BEAMON, a person
required to file a return, report, or other document regarding sales taxes due on retail sales activity with the
Commissioner of the Minnesota Department of Revenue, acting alone or intentionally aiding, advising,
hiring, counseling or conspiring with James Shelly Beamon, attempted to evade or defeat a tax by failing to
file a return, report or other document when required.
Page
COUNT 6:
5
FAILURE TO FILE SALES TAX RETURN
MINN. STAT. § 289A.63, SUBD. 1(a); § 609.03(1); § 609.05
PENALTY: 0-5 YEARS AND/OR $10,000
That on or about September 2012, in Hennepin County, Minnesota, SUSAN KERRY BEAMON, a person required
to file a return, report, or other document regarding sales taxes due on retail sales activity with the Commissioner of
the Minnesota Department of Revenue, acting alone or intentionally aiding, advising, hiring, counseling or
conspiring with James Shelly Beamon, attempted to evade or defeat a tax by failing to file a return, report or other
document when required.
COUNT 7:
FAILURE TO REMIT SALES TAX
MINN. STAT. § 289A.63, SUBD. 1(b); § 609.03(1); §609.05
PENALTY: 0-5 YEARS AND/OR $10,000
That on or about May 2012, in Hennepin County, Minnesota, SUSAN KERRY BEAMON, a person required to
pay or to collect and remit a tax, acting alone or intentionally aiding, advising, hiring, counseling or conspiring with
James Shelly Beamon, willfully attempted to evade or defeat a tax law by failing to pay or to collect and remit a
sales tax.
COUNT 8:
FAILURE TO REMIT SALES TAX
MINN. STAT. § 289A.63, SUBD. 1(b); § 609.03(1); § 609.05
PENALTY: 0-5 YEARS AND/OR $10,000
That on or about June 2012, in Hennepin County, Minnesota, SUSAN KERRY BEAMON, a person required to
pay or to collect and remit a tax, acting alone or intentionally aiding, advising, hiring, counseling or conspiring with
James Shelly Beamon, willfully attempted to evade or defeat a tax law by failing to pay or to collect and remit a
sales tax.
COUNT 9:
FAILURE TO REMIT SALES TAX
MINN. STAT. § 289A.63, SUBD. 1(b); § 609.03(1); § 609.05
PENALTY: 0-5 YEARS AND/OR $10,000
That on or about July 2012, in Hennepin County, Minnesota, SUSAN KERRY BEAMON, a person required to pay
or to collect and remit a tax, acting alone or intentionally aiding, advising, hiring, counseling or conspiring with
James Shelly Beamon, willfully attempted to evade or defeat a tax law by failing to pay or to collect and remit a
sales tax.
COUNT 10:
FAILURE TO REMIT SALES TAX
MINN. STAT. § 289A.63, SUBD. 1(b); § 609.03(1); § 609.05
PENALTY: 0-5 YEARS AND/OR $10,000
That on or about August 2012, in Hennepin County, Minnesota, SUSAN KERRY BEAMON, a person required to
pay or to collect and remit a tax, acting alone or intentionally aiding, advising, hiring, counseling or conspiring with
James Shelly Beamon, willfully attempted to evade or defeat a tax law by failing to pay or to collect and remit a
sales tax.
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COMPLAINT SUPPLEMENT
CCT
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COUNT 11:
SECTION/Subdivision
289A.63
289A.63
289A.63
289A.63
289A.63
M.O.C.
Y1510
Y1510
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Y1510
GOC
X
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X
X
FAILURE TO REMIT SALES TAX
MINN. STAT. § 289A.63, SUBD. 1(b); § 609.03(1); § 609.05
PENALTY: 0-5 YEARS AND/OR $10,000
That on or about September 2012, in Hennepin County, Minnesota, SUSAN KERRY BEAMON, a person required
to pay or to collect and remit a tax, acting alone or intentionally aiding, advising, hiring, counseling or conspiring
with James Shelly Beamon, willfully attempted to evade or defeat a tax law by failing to pay or to collect and
remit a sales tax.
NOTICE: You must appear for every court hearing on this charge. A failure to appear for court on this
charge is a criminal offense and may be punished as provided in Minn. Stat. § 609.49.
THEREFORE, Complainant requests that said Defendant, subject to bail or conditions of release be:
(1)
arrested or that other lawful steps be taken to obtain defendant’s appearance in court; or
(2)
detained, if already in custody, pending further proceedings;
and that said Defendant otherwise be dealt with according to law.
COMPLAINANT’S NAME:
COMPLAINANT’S SIGNATURE:
Gary Charboneau
DATE:
Being duly authorized to prosecute the offense(s) charged, I hereby approve this Complaint.
PROSECUTING ATTORNEY’S SIGNATURE:
ks
PROSECUTING ATTORNEY:
NAME/TITLE:
EMERY E ADORADIO (307786)
Assistant County Attorney
ADDRESS/TELEPHONE:
C2100 Government Center, Minneapolis, MN 55487
Telephone: 612-348-7947
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Court Case # ________________________
This COMPLAINT was subscribed and sworn to before the undersigned this ____ day of __________________, 20___.
NAME:
SIGNATURE:
TITLE:
FINDING OF PROBABLE CAUSE
From the above sworn facts, and any supporting affidavits or supplemental sworn testimony, I, the Issuing Officer, have determined that
probable cause exists to support, subject to bail or conditions of release where applicable, Defendant(s) arrest or other lawful steps be
taken to obtain Defendant(s) appearance in Court, or his detention, if already in custody, pending further proceedings. The Defendant(s)
is/are thereof charged with the above-stated offense.
SUMMONS
THEREFORE YOU, THE ABOVE-NAMED DEFENDANT(S), ARE HEREBY SUMMONED to appear on the _______ day of
____________________, 20_____ at _______ AM/PM before the above-named court at _______________________________________
_________________________________________________ to answer this complaint.
IF YOU FAIL TO APPEAR in response to this SUMMONS, a WARRANT FOR YOUR ARREST shall be issued.
WARRANT
EXECUTE IN MINNESOTA ONLY
To the sheriff of the above-named county; or other person authorized to execute this WARRANT; I hereby order, in the name of the
State of Minnesota, that the above-named Defendant(s) be apprehended and arrested without delay and brought promptly before the
above-named Court (if in session, and if not, before a Judge or Judicial Officer of such Court without unnecessary delay, and in any event
not later than 36 hours after the arrest or as soon thereafter as such Judge or Judicial Officer is available) to be dealt with according to
law.
ORDER OF DETENTION
Since the above-named Defendant(s) is already in custody; I hereby order, subject to bail or conditions of release, that the abovenamed Defendant(s) continue to be detained pending further proceedings.
Bail: NBR ($ 35,000 if Defendant fails to appear on Summons)
Conditions of Release:
This COMPLAINT- SUMMONS
duly subscribed and sworn to, is issued by the undersigned Judicial Officer this
____ day of _____________________________, 20____.
____________________________________________________________________________________________
____________________________________________________________________________________________
NAME:
SIGNATURE
TITLE:
JUDGE OF DISTRICT COURT
Sworn testimony has been given before the Judicial Officer by the following witnesses:
STATE OF MINNESOTA
COUNTY OF HENNEPIN
Clerk's Signature or File Stamp:
STATE OF MINNESOTA
Plaintiff
vs.
SUSAN KERRY BEAMON
Defendant(s).
RETURN OF SERVICE
I hereby Certify and Return that I have served a copy of this
COMPLAINT – SUMMONS, WARRANT, ORDER OF
DETENTION upon Defendant(s) herein-named.
Signature of Authorized Service Agent: