1 post tagged “pfui”

By DAVID ASHENFELTER
March 2, 2008

The La Shish restaurant chain, which helped popularize Middle Eastern cuisine in metro Detroit, went out of business Saturday night -- the victim of bad publicity involving its fugitive owner, Talal Chahine, whom federal prosecutors linked to terrorism.

“It’s a real tragedy,” the chain’s lawyer, Robert Forrest of Detroit, said Sunday.

He said the closure affects 11 metro Detroit restaurants, the chain’s headquarters and its food preparation facility in Dearborn, as well as its 305 employees, who were informed of the decision Sunday morning.

Chahine, a former Ford Motor Co. engineer, opened his first restaurant in 1989 in east Dearborn.

Forrest, the chain’s tax lawyer, said Michigan’s declining economy and a refusal by state treasury officials to approve the sale of the chain and use the proceeds to pay back taxes, also contributed to the chain’s demise.

He said the chain’s real estate, equipment and furnishings will be sold to pay its state and federal tax debts.

Another metro Detroit lawyer blamed the closings on the U.S. Attorney’s Office in Detroit for refusing to approve the sale unless Chahine returned to the United States to face charges. The lawyer, who spoke on condition of anonymity for fear of antagonizing federal prosecutors, said the refusal caused 305 people to needlessly lose their jobs — and the state and federal governments to be stuck with a tax loss approaching $12 million.

U.S. Attorney Stephen Murphy declined to comment, as did the Michigan Department of Treasury and the Internal Revenue Service IRS Criminal Investigation division.

Murphy’s staff previously had said that the government wouldn’t negotiate with Chahine while he was a fugitive.

Hungry customers disappointed

“Now what am I going to eat?” customer Linda Nowinski, 56, of Livonia said Sunday after pulling up to a La Shish drive-through window in Westland. She said she and coworkers regularly ate at the restaurant.

“There are lots of Middle Eastern restaurants in metro Detroit, but La Shish’s name was the most recognizable,” Free Press restaurant critic Sylvia Rector said.

Rector said Chahine “played a huge role in popularizing Middle Eastern cuisine in metro Detroit.”

“Their food was terrific,” Rector added, saying it helped Chahine create a reputation and open more stores. But she said other Middle Eastern restaurants will fill the void.

The chain’s undoing began in April 2005 when federal agents raided Chahine’s homes and headquarters looking for evidence that he had created a dual set of computerized books to evade $6.9 million in federal income taxes.

In May 2006, he was indicted with his wife, Elfat El Aouar, on tax evasion charges. By then, Chahine had fled to Lebanon, with $20 million he had skimmed from the business, authorities allege. He pledged to return to face charges but hasn’t.

He later was indicted on other charges, including allegations that he vouched for the fraudulent marriage a of a Lebanese immigrant, Nada Prouty, who became a U.S. citizen, got key jobs with the FBI and CIA, and allegedly leaked information from an investigation of Hezbollah to Chahine. The U.S. State Department has designated Hezbollah as a Lebanese terrorist group.

Chahine's wife, El Aouar, was sentenced last week to 90 days in prison for immigration fraud -- obtaining U.S. citizenship through a fraudulent marriage. El Aouar, a former roommate of Prouty, later married Chahine. That sentence will be served simultaneously with an 18-month sentence for tax fraud. Her citizenship also was revoked.

The bad publicity caused two of Chahine’s franchise owners in West Bloomfield and Ann Arbor to pull out of the chain in 2006 and rename their restaurants to stay afloat.

Charges of terrorist ties harmful

Osama Siblani, publisher of the Arab American News in Dearborn, said federal prosecutors drove La Shish out of business by accusing Chahine of supporting Hizballah, which the U.S. government has labeled as a Lebanese terrorist group.

“It broke down the trust between the customers and the merchant,” he said, adding that customers didn’t want to support someone who might be sending money to terrorists. He said the government has made similar reckless claims that have hurt Islamic charities.

Imad Hamad, regional director of the American-Arab Anti-Discrimination Committee, said the shuttering of the chain “is a great loss,” but said the case shows what happens when a businessman breaks the law.

“La Shish became an icon, nobody can deny it,” he said, adding that customers will miss it, and employees will be forced to find other work in difficult economic times.

“But you have to go by the law,” he added, referring to the tax evasion charges. “Good business and quality food aren’t going to save you from facing legal proceedings” if you do something wrong, he said.

What a shame!!