Most Shocking Case

The case was once called "one of the most shocking in Treasury history" by ex-Secretary Henry Morgenthau Jr. As the evidence of tax evasion piled up in Manhattan federal court against Henry Lustig, owner of Manhattan's glittering, high-priced Longchamps Restaurants, Inc., it was indeed shocking. Restaurateur Lustig, who came up from peddling vegetables on Manhattan's lower East Side, had missed few tax-dodging tricks.

With the help of a nephew and employe, E. Allen Lustig, and his chief bookkeeper Joseph Sobel, Longchamps' had kept two sets of books, one for Henry, one for Uncle Sam. Profits on which taxes were paid...