Owner of City Restaurants Faces Jail, Fines for Tax Evasion

The owner of classic cinema-themed restaurants in Midtown and on the Upper East Side has pleaded guilty to underreporting income from the businesses and evading $700,000 in taxes and penalties, the Manhattan district attorney, Robert Morgenthau, announced yesterday.

Steve Galanis, 44, pleaded guilty to two misdemeanor counts of tax fraud and faces 30 days in jail and is required to pay $700,212 in back taxes, interest, and penalties, Mr. Morgenthau said in a statement. Mr. Galanis owns four Manhattan restaurants that serve dinner while showing classic films, Cinema Café, Cinema 60, Spartis Power, Inc., and Evrotas Enterprises. The restaurants started as Mr. Galanis's answer to a lack of silent movie venues in the city, and often showed films by directors F.W. Murnau and Cecil B. DeMille, according to its Web site.

Investigators with the New York State Department of Taxation and Finance and the Manhattan district attorney's office discovered that Mr. Galanis collected but did not pay $517,117 in sales tax between December 2001 and November 2006, and that he owes $183,095 in interest and penalties, according to the announcement.