Husband and wife Pino and Lucia DiMeo immigrated to the United States from Venice more than 20 years ago. Since that time the couple built a number of successful Italian kitchen and pizzeria restaurants with locations in multiple states. In many ways, it appeared that the DiMeo’s were living their version of the American Dream.
Unfortunately, appearances do not always tell the whole story. Despite the couple’s numerous successful business ventures, allegations made by federal agents from the IRS and prosecutors from the Department of Justice charge that at least some of the success experienced by the couple was due to various forms of tax fraud. Through these allegations, Giuseppe “Pino” DiMeo now faces 14 separate criminal tax charges. If convicted and sentenced to maximum penalties, DiMeo could be sentenced to a maximum of 46 years behind bars, three years of supervised release, a $3.5 million fine and a $1,400 special assessment.
It is essential to note that waiting to seek tax help until federal agents are knocking on the door of your home or office can mean that you will already face unwinnable circumstances. The sole mission of the criminal investigation division of the IRS to criminally prosecute taxpayers that willfully violate tax law. When IRS agents seek to gather evidence for use in a criminal tax proceeding, they will frequently simultaneously raid both the home and business of the implicated parties. This is because individuals engaged in fraud often choose to stash their illicit gains – often in the form of luxury purchases that demonstrate that they are living beyond their means or a safe full of unreported cash – at home. Furthermore, an unannounced raid on a business will allow agents to seize data and evidence regarding business operations, often by seizing point of sale systems, computers and servers along with business records.
This is roughly what happened in this alleged tax fraud scenario. On a morning in early June 2014, federal agents arrived at the home of the DiMeos. IRS agents were still present at the home hours later. Eyewitnesses reported that the agents removed large cardboard boxes from the residence following their search. While it is unclear what these boxes contained, it may have been a second set of books or other documents showing importer actions.
Nearly simultaneously, a second team of federal agents arrived at one of the DiMeo’s nearby restaurants. The agents posted a sign in the window stating: “Closed until further notice.” During their visit, the agents requested payroll documentation and performed a forensic investigation of the business’s computers, safe and an on-site office. Employees were asked to identify themselves by agents. Agents also asked follow-up questions regarding how they were compensated. Eyewitnesses also report that the agents were taking video of the business facilities and operations.
Due to the suspicions raised by red flags in the business owner’s handling of his tax obligations and from the information gathered during the raids on his home and business, the restauranteur now faces numerous serious criminal tax charges. Agents charge that DiMeo and business partners defrauded the U.S. government by failing to account for, collect, and pay over employment taxes and other violations of the U.S. Tax Code.
Specifically, DiMeo is charged with failing to report more than $3 million in gross receipts, which defrauded the IRS of approximately $1 million in income and payroll taxes. The fraud allegedly occurred from 2008 through 2012. The allegations made against DiMeo in his charging indictment include:
DiMeo now faces two counts of conspiring to defraud the IRS and 12 counts of filing false tax returns. If convicted on all counts, DiMeo could be sentenced to serve more than four decades in federal prison and face other serious consequences.
If you have concerns about the handling of payroll tax or any other tax obligation at your business, the tax audit defense attorneys, and CPAs of the Tax Law Offices of David W. Klasing may be able to provide strategic guidance. To schedule a confidential reduced rate consultation at our Los Angeles or Irvine locations, call 800-681-1295 or schedule online today.