5 years for Nifty Fifty's CPA who stole $3.8M, evaded $2.2M in taxes

To his family and friends, William Frio was a devoted son, diligent coach and dedicated mentor.

But according to his defense attorney, at the same time Frio was held in such high regard, he was an "addicted, desperate mess of a man."

Prosecutors used plainer language. They called Frio a liar, a cheater, and an embezzler who "lived a life of insistent criminality."

For more than two decades, Frio, 59, worked for Nifty Fifty's, the Delaware Co.-based restaurant chain. Cooking the books was his specialty.  During his tenure, Frio helped organize a "massive" scheme that enabled the owners of the nostalgia-themed burger restaurants to evade more than $2.2 million in taxes.

As he conspired with the owners, Frio fed his personal gambling addiction by draining the chain's tax accounts of nearly $4 million.

On Thursday, U.S. District Judge Mary A. McLaughlin sentenced Frio to five years in federal prison for his role in the tax evasion scheme. He was the last of six Nifty Fifty's defendants to be sentenced.

McLaughlin noted that though Frio had not been "the kingpin" of the conspiracy, Frio had admitted to several other illegal acts. Those offenses included filing multiple false personal tax returns for the Nifty Fifty's owners, filing a false loan application for a $417,000 mortgage, under-reporting his own income, embezzlement and numerous thefts.

"This was a large scale amount of crime," she said. "This was not an aberration."

Minutes after McLaughlin rendered her decision, a shaken Frio collapsed to the courtroom floor, hitting his head against a wooden table as he fell. His family, already in tears, rushed to his side as court officials called for emergency help.  Frio later left the Philadelphia courthouse under his own power after being assured he hadn't suffered a heart attack.

Frio was an accountant with rare skills. Prosecutors described how he was able to make it appear that the wildly successful restaurant chain made little or no money. Frio also worked magic with the personal tax returns for the Nifty Fifty's owners. Though the owners each raked in hundreds of thousands of dollars a year, Frio could "zero out their taxes" and often submitted returns that generated refunds from the IRS.

Frio's attorney, Michael Engle, had argued the owners had hired Frio because he had addictions to both gambling and cocaine. "He owned bookies and loan sharks," Engle said. "He was the perfect mark."

"He was a tool," Engle said.

Frio, who once served as an assistant basketball coach at Devon Prep, was not charged in the embezzlement of the nearly $4 million.

His co-conspirators in the tax evasion scam are already serving their prison terms. Robert Mattei was sentenced to 15 months; Leo McGlynn, 36 months; Joseph Donnelly, 28 months; Elena Ruiz, 12 months; and Brian Welsh 20 months.

In addition to the prison term, McLaughlin ordered Frio to serve four years of supervised release and pay $1.7 million in restitution.