NEW YORK (1010 WINS) — Three leaders from Yoga to the People, the now-defunct yoga chain founded in New York City that was initially donation-based and requested but did not require payment from its students, were arrested on tax fraud charges in Washington state on Wednesday.
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Federal prosecutors allege that the businesses' longtime leaders, Gregory Gumucio, Michael Anderson and Haven Solimon, all received a substantial amount of income, yet none filed individual or business tax returns or paid any income taxes from at least 2013 through 2020.
"As alleged, the defendants operated a lucrative nationwide yoga business, which brought in over $20 million and netted them each substantial sums, permitting them to live lavish lifestyles," said U.S. Attorney Damian Williams.
Gumucio founded Yoga to the People in 2006 with a studio on the Lower East Side and eventually opened at least 20 studios or affiliated entities throughout New York City and in various other places, including California, Colorado, Arizona, Florida, and Washington state.
It operated until 2020, and from 2010 to its closure, the company and its affiliates generated gross receipts of more than $20 million. Prosecutors allege the company never filed a corporate tax return with the IRS.
Williams said they paid off employees in cash and off the books, refused to provide employees with tax documentation, did not maintain books and records, paid personal expenses from business accounts and used nominees to disguise their connection to various entities to perpetuate the fraud.
"At least two of the defendants even submitted fabricated tax returns to third parties when seeking a loan or an apartment, despite not filing any tax returns with the IRS," he added.
All three enjoyed "extravagant lifestyles, which included frequent foreign travel; expensive meals and clothing; NFL season tickets; and horse lodging and horseback riding," according to a Department of Justice news release.
"The defendants purported to create a donation-based exercise community to make yoga more accessible for their clients, when in reality, they allegedly ran a more than decade-long cash cow that relied on a sophisticated network of tens of millions of dollars in unreported income and free labor to fund the leaders' lavish lifestyles," said Thomas Fattorusso, special agent in charge at the IRS Criminal Investigations New York field office.
Each is charged with one count of conspiracy to defraud the IRS, which carries a maximum penalty of five years in prison, as well as five counts of tax evasion, each of which carries a maximum penalty of five years in prison.
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