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Greenwich resident Richard Josephberg was charged in Manhattan Federal Court on Friday with five counts of tax evasion and four counts of willful failure to file tax returns for a scheme that began in 2010. Each count carries a maximum sentence of one year in prison.
Late in 2010, Josephberg began working for an investment firm in Manhattan. Through the owner of that firm, Josephberg went on to secure a second, commission-based arrangement with another investment firm, which agreed to pay him a commission of approximately 15 percent of any profit generated on deals that originated through Josephberg. For brokering one such deal, Josephberg was entitled to commission payments totaling approximately $1.57 million in 2011.
After receiving payments totaling approximately $35,725 in his own name of that commission, Josephberg directed the firm to issue the remaining commission to a newly formed nominee corporate entity titled “Almorli Advisors Inc.,” where $1.53 million into a bank account in that name.
In March the following year, Geoffrey Berman, the United States Attorney for the Southern District of New York, said that Josephberg took steps to avoid paying hundreds of thousands of dollars in federal income taxes by disguising and concealing the type of income he received from the commission. Josephberg allegedly had his accountant falsify documents and claimed the commission as a long-term capital gain, rather than ordinary income.
Berman said that Josephberg’s fraudulent misclassification of this income resulted in a reported tax liability that was hundreds of thousands of dollars lower than the true tax liability because individual long-term capital gains were taxed at a significantly lower rate than ordinary income.
“Richard Josephberg allegedly defrauded the IRS and evaded taxes by disguising more than $1.5 million in income as long-term capital gain,” he said. “He also allegedly failed to file tax returns for four years. Working with IRS Criminal, we are determined to ensure that everyone meets his tax obligations.”
Josephberg also allegedly engaged in a scheme to evade the assessment of federal income taxes between 2013 and 2016, when he failed to file to file any federal income tax returns until after the IRS contacted him in May last year.
IRS-CI Special Agent in Charge James D. Robnett added, “The IRS enforces the nation’s tax laws and Special Agents are experts at following the money through multiple entities and complex structures. People who create elaborate schemes designed to mislead the IRS run the very high risk of arrest and criminal prosecution.”
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