Former Memphis Business Owner Arrested on Sales Tax Fraud and Theft

MEMPHIS - The Special Investigations Section of the Tennessee Department of Revenue conducted the investigation that led to the indictment and arrest of Frankel Mosley, former owner of The HM Lounge.  Mosley, age 46, was booked into the Shelby County Jail earlier this week.

On July 13, a Shelby County Grand Jury indicted Mosley on two Class E felony counts of sales tax fraud and one Class C felony count of theft of property over $10,000.  If convicted, Molsey could be sentenced to a maximum of six years in the state penitentiary and fined up to $10,000 for the theft charge and up to two years and fined up to $3,000 for each charge of sales tax fraud.

“Investigations, such as this one, should warn retailers that failing to properly remit all the sales tax monies they collect is a crime,” Revenue Commissioner David Gerregano said.  “The taxes collected from customers are property of the state and local governments.  Customers have a right to know that the tax they pay will be remitted to the state and used for public good of Tennesseans.”

The department pursued this criminal case in cooperation with District Attorney Steven Mulroy’s office.  Citizens who suspect violations of Tennessee's revenue laws should call the toll-free tax fraud hot line at (800) FRAUDTX (372-8389).

The Department of Revenue is responsible for the administration of state tax laws and motor vehicle title and registration laws and the collection of taxes and fees associated with those laws.  The department collects about 87 percent of total state revenue.  During the 2022 fiscal year, it collected nearly $20.9 billion in state taxes and fees and more than $4.3 billion in taxes and fees for local governments.  To learn more about the department, visit www.tn.gov/revenue.

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