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The owner of a chain of bikini barista coffee stands in Washington has been sentenced to 10 months in prison and fined $75,000 for filing false tax returns, according to U.S. Attorney Tessa Gorman. Assad Baragzai, 47, of Yarrow Point, Washington, was accused of failing to report up to $6 million in income between 2016 and 2020.

U.S. District Judge Tana Lin criticized Baragzai for his actions, stating, “The tax system is an honor system … and you weren’t honorable. There was absolutely no reason for you to be cheating on your taxes except for pure greed.”

Background story: Owner of Seattle bikini barista coffee stands in hot water with IRS

Gorman emphasized the importance of tax compliance, noting that the government relies on most Americans who pay taxes to fund essential services.

“Mr. Baragzai had great business success but failed to fund the community that made that success possible,” she said. “Such conduct is not erased by paying what is owed some five years later – it is appropriate that he serve prison time for his willful tax fraud.”

Court records reveal that Baragzai significantly underreported his income to his tax accountant, resulting in a tax loss of more than $1.7 million over five years. The tax loss for 2017 alone exceeded $687,000. Although Baragzai disputed these figures, claiming legitimate deductions, Judge Lin determined the tax loss to be $1,348,154.

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Assistant U.S. Attorney Mike Dion, who sought a two-year prison term, highlighted the broader impact of Baragzai’s actions.

“Assad Baragzai reaped the benefits of American society but somehow convinced himself that he did not need to pay his share of the costs that support that society,” Dion said in a news release. “All Americans pay a price for this kind of selfishness.”

Adam Jobes, Special Agent in Charge of IRS Criminal Investigation’s Seattle Field Office, added, “Instead of paying his fair share toward public resources as every law-abiding American does, Mr. Baragzai misrepresented his income to furnish an already-lavish lifestyle.”

Baragzai is the second person sentenced in this investigation. In October 2024, his brother-in-law, Rajesh Mathew, 45, of Auburn, Washington, received a 30-day jail sentence, a $5,000 fine, and 100 hours of community service for filing a false tax return.

Baragzai has agreed to pay restitution to the IRS and may face additional civil penalties, fines and interest for the tax loss. The Internal Revenue Service Criminal Investigation investigated the case.

Bill Kaczaraba is a content editor at MyNorthwest. You can read his stories here. Follow Bill on X, formerly known as Twitter, and email him here.Ìý