Long Island Businesswoman Convicted of Obstructing the Internal Revenue Service, Filing False Tax Returns, and Structuring Cash Deposits
Earlier today, Salvatore Demeo, an alleged member of the Genovese organized crime family of La Cosa Nostra, pled guilty at the federal courthouse in Brooklyn to attempted tax evasion. At the guilty plea proceeding, Demeo admitted that he attempted to evade paying taxes on more than $1.6 million he earned in capital gains through a real estate transaction in 2014. As part of his guilty plea, Demeo agreed to pay the Internal Revenue Service $367,673, which represents the tax he owed for the 2014 real estate transaction and another one in 2013. Today’s plea took place before United States Magistrate Judge Vera M. Scanlon.
Richard P. Donoghue, United States Attorney for the Eastern District of New York, and James Robnett, Special Agent-in-Charge, Internal Revenue Service-Criminal Investigation, New York (IRS-CI), announced the guilty plea.
As detailed in the indictment and other court filings, in two separate real estate transactions in 2013 and 2014, Demeo sold his shares in valuable real estate in Brooklyn, earning him more than $2 million in capital gains. Rather than report this income as he was required to do, Demeo took a series of measures designed to conceal the proceeds from the IRS. For example, he instructed his attorney to issue his shares to him in eight separate bank checks: three checks for the first transaction and five checks for the second transaction. In addition, the defendant enlisted the assistance of others to help conceal the funds. First, he endorsed two checks, amounting to $1 million, to a plumbing business, despite the fact that he has no apparent ownership interest in it, or other business relationship with it. Demeo endorsed another of the checks, in the amount of approximately $355,944, to an individual who operated an unlicensed check-cashing business, and withdrew approximately five cashier’s checks in smaller amounts, which were then cashed at licensed check-cashing establishments in exchange for a fee. As a result of Demeo’s fraud, the defendant avoided payment of federal taxes in excess of $365,000.
When sentenced, Demeo faces up to five years in prison, as well as a fine of up to $250,000.
The government’s case is being handled by the Office’s Organized Crime and Gangs Section. Assistant United States Attorney Elizabeth Geddes is in charge of the prosecution.
Brooklyn, New York
E.D.N.Y. Docket No. 17-CR-545 (KAM)
United States Attorney’s Office