Owners Of Famed Philly Eatery Tony Luke's Sentenced For Fraud Scheme

Philly foodie destination Tony Luke's is serving up controversy. According to the local tourism website Visit Philadelphia, Tony Luke's biggest hot point is usually "the age-old dilemma: the Cheesesteak or the Roast Pork Italian." But, now, father and son co-owners Nicholas Lucidonio and Anthony Lucidonio Sr. (aka the eponymous "Tony Luke") are going to prison for federal tax evasion charges linked to a scheme that ran for a decade.

From 2006 to 2016, the pair failed to report over $8 million worth of cash receipts to the IRS. In addition to not depositing all of the business's cash into the business's bank account, the Lucidonios also committed payroll tax fraud by paying a substantial portion of their employees' income in cash "off the books," according to a statement by the U.S. Department of Justice.

They didn't report the cash wages to their accountant, effectively concealing millions of dollars and leading to a decade of false tax returns with substantially underreported income. After pleading guilty in 2022, the pair has officially been sentenced to 20 months in prison each, followed by three years of supervised release. The tax fraud scheme was discovered by IRS Criminal Investigation, but it had a little help getting tipped off to the issue in the first place.

A flagrant family affair

Tony Luke Jr. is the brother of Nicholas and son of Anthony Lucidonio, and he is not involved in the tax fraud scheme. He owns multiple Tony Luke's franchise locations but split from the incriminated pair years ago following a public legal battle regarding franchising rights and recipe ownership. Tony Luke Jr. was fired from the Original Tony Luke's in 2015 and sued his father and brother, which effectively expanded the business into a multiple-location franchise chain with some locations being owned by Nicholas and Anthony Lucidonio and other locations being owned by Tony Luke Jr. According to local news outlet The Philly Voice, as the case played out, the IRS caught wind of the illegal activity.

It was undoubtedly a bitter family dispute, but it looks like the relationship between the brothers remains at least somewhat intact. At the time of the Lucidonios' guilty plea in 2022, Tony Luke Jr. renamed the Original Tony Luke's restaurant to avoid reputation damage from the bad publicity. Notably, he changed the name to Tony's and Nick's Steaks. The ownership and menu remained unchanged.

Tony Luke's has been a South Philly mainstay since 1992 and has exploded into an international institution with many locations. There's even a Tony Luke's sandwich counter inside The Pentagon building — as well as in the Horseshoe Casino.