The owner of a New York construction company pleaded guilty in federal court last week to filing a false corporate tax return, concealing about $6.1 million in business income.
Pawel A. Bartoszek of Lake Grove, New York, admitted that from 2015 to 2017, he cashed checks he received from the clients of his business, Mega State, instead of depositing them into a corporate account, according to a U.S. Department of Justice press release.
Bartoszek, who was indicted in June 2022, allegedly used some of the cash to fund an off-the-books cash payroll for Mega State. The indictment also charges that Bartoszek did not inform his return preparer about the cashed checks, enabling Bartoszek to underreport Mega State’s gross receipts, sales and ordinary business income, according to the Department of Justice.
Bartoszek, who is scheduled to be sentenced in September, faces up to three years in prison as well as supervised release, restitution and fines.
Tax fraud and concealing income aren’t unusual in the world of real estate.
The most high-profile recent case was when a jury in November found two affiliate companies of the Trump Organization guilty of nine counts of tax fraud and related crimes.
The case alleged the Trump Organization avoided taxes through various means, including providing benefits for executives in place of taxable salaries and paying employees as “independent contractors.”
Among the perks the Trump Organization allegedly doled out were private school tuition, a lease on a Mercedes for former CFO Allen Weisselberg and covering the rent of his Manhattan apartment.
In March, former home builder Kent Pecoy, of Wilbraham, was indicted on one count of corrupt concealment of records, with intent to impair their use in an official proceeding, one count of obstruction of an official proceeding, and one count of making false statements in a federal proceeding, according to a statement from the U.S. Attorney’s Office in Boston, representing the Department of Justice.
Pecoy, who owned West Springfield-based Kent Pecoy & Sons, allegedly received hundreds of thousands of dollars in cash between 2013 and 2016 to construct a home. Instead of depositing the funds into his business’ account, Pecoy allegedly took the cash and directly paid the project’s vendors and subcontractors, prosecutors alleged.