Owner of Unauthorized Minnesota Nightclub Accused of Tax Crimes

Rochester, MN (KROC-AM News)- The owner of a Rochester business is facing nine felony counts of tax-related crimes.

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The charges, filed Monday in Olmsted County Court, are the result of an investigation conducted by the Rochester Police Department, Minnesota Department of Public Safety and Minnesota Department of revenue.

The charging document indicates law enforcement was made aware of potential tax crimes in the Spring of 2023.

Charges: Unauthorized Rochester Nightclub Owner Didn't Pay Taxes, Lied About Income

Authorities learned a business called 4S Entertainment was running an unauthorized night club from 2 a.m. until 5 a.m. on Fridays and Saturdays.

In late March 2023, two officers attended the alleged unlicensed night club and paid cover charges and purchased alcoholic beverages once they were inside of the business at 3610 Wellner Dr. Northeast.

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A news release issued by the Rochester Police Department says the investigation indicates the owner, identified as 47-year-old Donyale Demon Gayles-Johnson of Rochester, did not pay income tax on money made through the cover charges and drink sales.

Gayles-Johnson is also accused of underreporting money the business made. The investigation’s findings allege the unauthorized night club ran from 2019-2023, police say.

Gayles-Johnson owes $7,967.68 in sales and use tax, penalty, and interest for these years of $32,340.27 in income tax, penalties, and interest, the complaint says.

Gayles-Johnson is charged with five counts of failing to pay or collect taxes and four counts of filing false or fraudulent tax returns.

Each count carries a maximum penalty of up to five years in prison, a fine of up to $10,000 or both. The Rochester business owner is scheduled to appear in court next month.