The Georgia Department of Revenue raided Gladys Knight’s Chicken and Waffles restaurants Tuesday as they opened a criminal investigation into her son’s business dealings. Knight is not under investigation, and authorities said she is not suspected of any criminal activity. BOB ANDRES / BANDRES@AJC.COM
Photo: Bob Andres
Photo: Bob Andres

Racketeering alleged in case against son of R&B legend Gladys Knight

The son of music legend Gladys Knight used her namesake chicken and waffle eateries as part of a racketeering scheme for at least 16 years, according to a civil suit filed by Clayton County prosecutors.

Shanga Hankerson, 39, diverted state income, sales and withholding taxes from his three Gladys Knight’s Chicken and Waffles restaurants to boost his income and acquire cash, real estate and other property, prosecutors said in the complaint.

But Steve Sadow, one of Hankerson’s attorneys, said his client is not guilty of a crime.

“It appears to me that this is a civil tax matter, not a criminal case,” said Sadow, lead co-council in the case.

Hankerson was released from Clayton County jail on $20,000 bond Wednesday afternoon, court records show, after he was booked into the jail early that morning. He faces two felony counts of theft by taking after racking up what Georgia Department of Revenue investigators said is a $1 million in unpaid taxes, penalties and interest.

Agents raided the restaurants and corporate headquarters Tuesday and filed the civil suit the same day. The filing asks a judge for permission to seize more than two dozen bank accounts, three automobiles and other property belonging to Hankerson and his businesses.

According to the suit, Hankerson and his businesses — Granite Foods, LLC, Cascade Foods, LLC and Rival Group, LLC — submitted fraudulent tax returns. More than $437,000 in sales and use taxes, plus some $126,000 in withholding taxes, went unpaid, it said.

Hankerson pocketed some $52,000 in state taxes during March and April alone, arrest warrants filed in Clayton County Magistrate Court state.

The popular restaurant, a tourist favorite known for southern cooking and long lines, continued to be closed Wednesday, and there was no news on the company’s website or social media accounts on when they plan to re-open. The most recent tweet from its Twitter handle, @GladysKnightChk, was from March 7, when the downtown restaurant re-opened after failing a health inspection. An employee reached by telephone at the corporate office said she could not provide further information.

Earlier this month, Knight herself visited the chain’s Peachtree Street location to reassure diners after the failed inspection.

Phones went unanswered Wednesday at its locations on Peachtree Street and Cascade Road in Atlanta and at Stonecrest Mall in Lithonia, and customers who arrived for lunch at the Peachtree Street restaurant found a handmade “closed” sign taped to the locked door.

Quinci Miller and Jasmine Johnson were visiting from Little Rock, Arkansas. “Every time I come to town, I eat there,” said Miller. “We’ll go somewhere else,” said Johnson.

Damian Lopez and three of his friends had driven from Naples, Florida for a quick tourist visit to Atlanta. Last year, Lopez tried to settle his fix for chicken and waffles at the famous restaurant but he was deterred by the long line. He had hoped that today he’d have better luck. “We are just trying to get some food,” Lopez said.

Especially surprised was Amoni Fields. “Today is supposed to be my first day of work,” said Fields, who was hired as a hostess. “I was hired Monday. I come back Wednesday, they are closed. That’s crazy,” she said.

“Why didn’t anyone call me?” she questioned aloud, adding that she had taken a bus and a train from her residence in Sandy Springs to arrive at her new place of employment.

Department of Revenue officials said they are working with Hankerson’s lawyers to re-open the businesses. A spokeswoman for Knight said after the raids that she has no role in the restaurants’ day-to-day operations, and the state agency said she is not a suspect in the case.

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Staff writers Tammy Joyner and Jennifer Brett contributed to this report.