June 26, 2002

PRESS RELEASE

PROVINCETOWN WOMEN PLEADS GUILTY TO
FILING FALSE TAX RETURN

Boston, MA... A Provincetown woman was convicted today in federal court of filing a false tax return.

United States Attorney Michael J. Sullivan and Peter Benevento, Acting Special Agent in Charge of the U.S. Internal Revenue Service, Criminal Investigation, announced today that PHYLLIS SCHLOSBERG, age 63, of 273 Commercial St., Provincetown, Massachusetts, pleaded guilty before Chief U.S. District Judge William G. Young to one count of filing a false tax return.

At today's plea hearing, the prosecutor told the Court that had the case proceeded to trial the Government's evidence would have proven that SCHLOSBERG, the owner of the Post Office Cabaret & Café in Provincetown, diverted cash receipts from the café by obtaining cashier's checks from her bank payable to herself which she did not disclose to her tax preparer. SCHLOSBERG used the funds directly or deposited them in another bank account. SCHLOSBERG kept the funds and the bank account concealed from her tax preparer and the proceeds were never reported on SCHLOSBERG's personal tax returns. The prosecutor told the Court that by filing the false tax return for the year 1995, SCHLOSBERG avoided paying $34,045 in taxes. In addition, SCHLOSBERG filed false tax returns in the years 1993 and 1996 and avoided paying taxes of in those years of $35,335 and $22,027, respectively.

Chief Judge Young scheduled sentencing for September 16, 2002 at 2:00 p.m. SCHLOSBERG faces up to 3 years' imprisonment, to be followed by 1 year of supervised release, and a $250,000 fine.

The case was investigated by the U.S. Internal Revenue Service. It is being prosecuted by Assistant U.S. Attorney Mark J. Balthazard in Sullivan's Economic Crimes Unit.

Press Contact: Samantha Martin, (617) 748-3139