Former Owner/Operator Of Sewing Company Sentenced In Manhattan Federal Court To Three Years In Prison For Payroll Tax Violations And Bail Jumping
Preet Bharara, United States Attorney for the Southern District of New York, announced that DONG SUN MUN (“MUN”), the former owner and operator of Match Fashions Inc. (“Match Fashions”), was sentenced today to three years in prison for his role in a scheme to evade payroll taxes and for jumping bail in January 2011. MUN was also ordered to pay restitution of more than $304,000 to the IRS. He was sentenced by U.S. District Judge William H. Pauley III.
According to the Information previously filed in this case, the subsequent bail jumping Indictment, and statements made during MUN’s guilty plea and sentencing proceedings:
MUN owned, operated, and controlled Match Fashions, a Manhattan company in the business of performing sewing work for couture companies. From 2004 through 2006, MUN cashed many of the checks received from customers of Match Fashions at check-cashing establishments located in Manhattan, instead of depositing them into bank accounts.
MUN used the cash generated from the checks to pay Match Fashions employees off the books to evade IRS reporting requirements. He also failed to withhold or remit to the IRS the required payroll taxes under the Federal Insurance Contributions Act (“FICA”) for these employees. In total, MUN paid cash wages, for which there was no withholding, of nearly $2 million, and failed to pay and withhold total FICA taxes of over $304,000.
Match Fashions ceased doing business in early 2007.
MUN was originally scheduled to be sentenced on the payroll tax charges in January 2011. Shortly before his original sentencing date, MUN, who was on bail at the time, fled to Vietnam and Korea and was subsequently arrested attempting to enter Canada.
* * *
In addition to the prison term and restitution, Judge Pauley sentenced MUN, 52, who previously resided in Palisades Park, New Jersey, to three years of supervised release, and ordered him to pay a $300 special assessment fee.
During the sentencing proceeding, Judge Pauley said “paying taxes is the price of living in a civilized society,” and MUN “wanted to live in a civilized society and enjoy all of its benefits but not share any of its burdens.”
Mr. Bharara thanked the Internal Revenue Service-Criminal Investigation for its outstanding work on the case.
The prosecution of MUN is one of a series of recent Southern District of New York payroll tax prosecutions of business owners in the garment industry, including: Raymond Chu, who was sentenced principally to two years in prison; Kevin Weng, who was sentenced principally to four years in prison; Mindy Wong, who was sentenced principally to five months in prison; and Andres Ortiz, who was sentenced principally to one year and one day in prison.
The case is being handled by the Office’s Complex Frauds Unit. Assistant U.S. Attorney Daniel W. Levy is in charge of this prosecution.