At all relevant times, BILAL SALAJ, a citizen and resident of the United States, operated a construction business in Manhattan. Initially, SALAJ was the record owner of the business, but in approximately July 2014, SALAJ began operating the business under a new entity that, on paper, was wholly owned by a third party (“Individual-1”), who worked for SALAJ in the construction business. Despite this purported change in ownership, SALAJ continued to exercise principal control and decision-making authority over the business and its financial affairs. In particular, SALAJ was a responsible person under federal law for collecting, truthfully accounting for, and paying over payroll taxes for the business to the IRS. According to the allegations contained in the Information to which SALAJ pled guilty, court filings, and statements made in public court proceedings:
Between at least in or about 2014 and in or about June 2019, SALAJ devised and perpetrated a scheme to evade a substantial portion of both the payroll taxes for the construction business and SALAJ’s personal income taxes for the period 2014 through 2018. During this period, SALAJ cashed, and caused Individual-1 to cash, approximately $3.2 million in business checks payable to the construction company at check cashing facilities in Manhattan, instead of depositing them into the company’s operating bank account. SALAJ and Individual-1 used a portion of the proceeds from the cashed checks to pay cash wages to employees of the construction business, and spent most of the rest on personal expenses. SALAJ did not withhold or pay over to the IRS any payroll taxes on the cash wages paid to the employees, and did not report to the IRS or pay any personal income taxes on the cash income he realized through the cashed checks. As part of the tax evasion scheme, SALAJ fraudulently withheld from his accountant any records relating to the cashed business checks, and thereby caused false tax returns to be filed with the IRS. The tax evasion scheme, including relevant conduct, resulted in a tax loss to the IRS of approximately $952,778. This case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorney Olga I. Zverovich is in charge of the prosecution.
Ms. Strauss praised the outstanding work of the Internal Revenue Service, Criminal Investigation, in this case. Source www.justice.gov
In addition to the prison term, Judge Castel ordered SALAJ, 56, of Morganville, New Jersey, to pay restitution to the IRS in the amount of $952,778. SALAJ was also ordered to serve three years of supervised release. * * *
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