A 55-year-old Belmont man who has run a pizza shop near Northeastern University for decades was arrested this week on federal charges that he hid more than $1.6 million in income from his restaurant and rental properties, after an undercover IRS agent posing as a prospective buyer secretly recorded him allegedly threatening violence over fears he was being investigated. Demetrios Pseudoikonomou pleaded not guilty to eight felony counts of presenting false and fraudulent tax returns following his arrest on August 12, 2026.
U.S. Attorney Leah B. Foley and IRS Criminal Investigation Special Agent in Charge Thomas Demeo announced the charges, which were brought following an investigation by the IRS Criminal Investigation Boston Field Office, according to the U.S. Attorney’s Office for the District of Massachusetts. Assistant U.S. Attorney Benjamin A. Saltzman is prosecuting the case. Pseudoikonomou made his initial court appearance in federal court in Worcester and was released, with a magistrate setting his bail at $10,000, according to reporting by The Boston Globe. His next court date is scheduled for September 23.
How the Sting Unfolded
The case traces back to 2022, when an IRS agent posed as a prospective buyer interested in purchasing Pseudoikonomou’s rental business, according to the Globe’s reporting. During a February 2022 meeting, Pseudoikonomou reportedly questioned the undercover agent directly, asking whether he was a police officer or wearing a wire. The outlet reports he told the agent he had received very few checks over the years and could teach him tricks of the trade.
Federal prosecutors say the alleged scheme involved routing restaurant revenue into four separate bank accounts while disclosing only two of them to his accountant, according to the same account. He also allegedly failed to disclose two other bank accounts, including his personal account, and took in rent money through direct Venmo and Zelle transfers that went unreported. Pseudoikonomou told the agent he gave his accountant a printout of everything he wanted him to have, and separately said his accountant reported what he was told but that his tax returns did not include everything, per the Globe’s account.
Threats Followed a Police Search
Police executed a search warrant at Cappy’s Pizza & Subs on August 4, 2022. According to prosecutors, Pseudoikonomou called the undercover agent afterward and threatened to kill him and send people to his house if he worked for the IRS or was trying to deceive him. He reportedly told the agent that the IRS had shown up at his door and that the agent was the only person he had given information to. At another point, after noticing the agent carrying two phones, Pseudoikonomou allegedly threatened him again and later said he believed the agent had deceived him…