The Justice Department and the Internal Revenue Service (IRS) announced today that Lawrence Garafola, a resident of Poway, Calif., pleaded guilty to tax evasion.
According to documents filed with the court, Garafola owned and operated A-1 Tree & Shrub Service (ATS), a landscaping business located in Freeport, N.Y. Beginning in approximately 2004 and continuing through approximately 2008, Garafola failed to report to the IRS a substantial portion of income he obtained through payment for services rendered by ATS. Instead of depositing checks to ATS into ATS’s business bank account, Garafola used a commercial check cashing service to cash checks and failed to report that income to his tax return preparer.
Garafola admitted that for tax years 2007 and 2008, he failed to report approximately $1,843,847 of income, resulting in an additional tax due and owing to the government of approximately $516,277.
Garafola faces a maximum sentence of five years in prison, three years of supervised release and a $250,000 fine. He has agreed to pay restitution of $760,637 to the IRS.
The case was investigated by IRS-Criminal Investigation. Trial Attorneys Mark Kotila and Robert Kennedy of the Justice Department’s Tax Division are prosecuting this case.