Two Los Angeles-area brothers were ordered Thursday to pay nearly $1 million in restitution and serve three years on probation for tax evasion related to their clothing company.
Derek and Justin Stradley — owners and operators of Plact Bros LLC in Valencia — pleaded guilty in Superior Court to multiple felonies for failing to report more than $6.7 million in taxable sales over a period of nearly 13 years and nearly $1 million in gross income over a period of two years, according to California Attorney General Xavier Becerra.
“When you rip off California’s taxpayers, there are consequences,” Becerra said. “The Stradley brothers did just that and now they’re paying the price. Tax evasion hurts the state’s efforts to provide public services and cheats businesses that do things the right way. At the California Department of Justice, we stand ready to enforce the rules and take on bad actors in the underground economy across the state.”
As part of their sentences, the brothers will be required to pay $997,803 in restitution to the state, county and other victims and forfeit any interest in an estimated $775,000 in counterfeit clothing seized during the investigation, Becerra said.
The brothers will also be required to perform 90 days of community service and face time in prison if they violate the terms of their sentence, prosecutors said.
The seizure and convictions were the result of an investigation by members of the Tax Recovery in the Underground Economy Task Force, including the Los Angeles County Sheriff’s Department, California Department of Tax and Fee Administration, California Franchise Tax Board, and special agents and prosecutors with the state DOJ.