South Carolina Doctor and Nephrology Practice Agree to Pay More Than $585,000 to Settle Laboratory Kickback Allegations
TRENTON, N.J. – A former chiropractor with offices in Lakewood, New Jersey, today admitted evading income taxes totaling more than half a million dollars from 2012 through 2015 and failing to report a Russian bank account, to which he wired more than $1.5 million, U.S. Attorney Craig Carpenito announced.
Carlo Amato, 57, of Beachwood, New Jersey, pleaded guilty before U.S. District Judge Michael A. Shipp in Trenton federal court to one count of tax evasion and one count of failure to file a report of foreign financial account (FBAR) while violating another law of the United States and as part of a pattern of illegal activity involving more than $100,000 in a 12-month period.
According to documents filed in this case and statements made in court:
From 2012 through 2015, Amato operated a chiropractic office in Lakewood through two entities: Chiropractic Care Consultants Inc. and Accident Recovery Physical Therapy. He deposited, or caused to be deposited, checks for chiropractic services into accounts held in the names of his minor children. Amato knew that these checks were taxable as income, but he did not disclose the payments to his accountant, nor did he report them on his tax returns. Amato also failed to report as taxable income certain additional funds that were deposited into Chiropractic Care’s and Accident Recovery’s business bank accounts. For example, Amato reported $0 in taxable income and $0 in tax due on his 2014 income tax return. His taxable income for 2014 was, in fact, $561,258, and Amato admitted that the tax due and owing to the IRS for 2014 was $197,036. Amato admitted that he also evaded more than $300,000 in taxes for the tax years 2012, 2013, and 2015.
Amato, a U.S. citizen, admitted that in 2014, he had an account at UniCredit Bank in Russia. He admitted that he wired more than $1.5 million to Russian bank accounts, including the UniCredit Bank account, and that he knew that he was obligated to report any foreign bank account with an aggregate value of more than $10,000. Amato admitted that he nonetheless failed to file a report of foreign account, commonly known as an FBAR, for the year 2014. Amato also admitted that the funds he failed to report were the product of a fraudulent scheme in which Amato overbilled at least six insurance companies by more than $1 million by billing for services that were never rendered. Amato previously pleaded guilty in Ocean County Superior Court to first degree financial facilitation of criminal activity for money laundering of funds from the overbilling scheme.
The tax evasion charge to which Amato pleaded guilty carries a maximum potential penalty of five years in prison and a fine of $250,000 or twice the gain to any person or loss to any victims of the offense. The failure to file a report of foreign account charge to which Amato pleaded guilty carries a maximum potential penalty of 10 years in prison and a fine of $500,000 or twice the gain to any person or loss to any victims of the offense. Sentencing is scheduled for Jan. 9, 2019.
Under the terms of his plea agreement, Amato will file amended tax returns and make full restitution for the years 2012 through 2015 and file accurate FBARs for the years 2012 through 2017.
U.S. Attorney Carpenito credited special agents of the IRS-Criminal Investigation, under the direction of Special Agent in Charge John Tafur, with the investigation leading to today’s guilty plea. U.S. Attorney Carpenito thanked the Ocean County Prosecutor’s Office, under the direction of Prosecutor Joseph D. Coronato, and the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie, for their roles in the investigation.
The government is represented by Assistant U.S. Attorney Elisa T. Wiygul of the Criminal Division in Trenton.