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Bilal Salaj, 55, of Morganville admitted in U.S. District Court downtown that he “continued to hold principal control and decision-making authority over the business and its financial affairs” of the business after changing ownership in July 2014, Southern District of New York Acting U.S. Attorney Audrey Strauss said.
That included continuing including “collecting, truthfully accounting for, and paying over payroll taxes to the IRS,” Strauss said.
Over the next five years, Salaj had an associate convert $3.2 million in business checks payable to the construction company at check-cashing facilities in Manhattan instead of depositing them into the company account, the assistant U.S. attorney said.
Both of them then “used a portion of the proceeds from the cashed checks to pay cash wages to employees of the construction business and spent most of the rest on personal expenses,” she said.
Salaj, who kept records of the cashed business checks from his accountant, didn’t withhold or pay over any taxes on the cash wages or report his personal income from the scheme to the IRS, Strauss said.
In the end, he ducked $952,778 in taxes, she said.
Salaj took a deal from the government, pleading guilty to single counts of defrauding the IRS and tax evasion and agreeing to pay the full amount owed in restitution.
A federal judge scheduled sentencing for March 3.
Strauss praised the “outstanding work” of IRS Criminal Investigation for led to the plea bargain, secured by her office’s Complex Frauds and Cybercrime Unit, headed by Assistant U.S. Attorney Olga I. Zverovich.
“When Mr. Salaj made the decision to evade paying taxes for himself and his business, he also made the decision to cheat every honest hardworking taxpayer,” IRS-CI Special Agent-in-Charge Michael Montanez.
Montanez said the plea should “send a strong deterrent message that IRS-Criminal Investigation will vigorously pursue those individuals who attempt to cheat our nation’s tax system.”
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