Prosecution moves forward for 11 NYC brokers accused of tax evasion

TRD New York /
May.May 12, 2008 03:57 PM

Eleven veteran New York City real estate brokers named in March as part of a tax evasion investigation led by the Albany County District Attorney face varying legal consequences, including reductions of charges, although no cases have been dismissed, authorities said.

Patrick Brennan, a senior associate broker at the Corcoran Group, was initially charged with two misdemeanor counts for failing to pay taxes in 2004 and 2005, the DA’s office said. Considered a minor offense, the charge was reduced to what’s called an adjournment in contemplation of dismissal.

If Brennan files an accurate tax return for two years, pays taxes owed plus penalties and interest, and stays out of legal trouble for six months, the case will be dismissed, the DA’s office said. Otherwise, the DA will prosecute the case.

Two other Corcoran brokers similarly saw their charges reduced: Corcoran vice president and associate broker, Gabriel Bedoya, who also has a real estate investment firm, was initially hit with two misdemeanors for allegedly living tax-free in 2004 and 2006; Dennis Hughes, a senior vice president and associate broker at Corcoran, was originally charged with a misdemeanor for allegedly failing to pay taxes in 2006.

Miriam Sirota, a senior vice president and associate broker at Corcoran, will be arraigned on tax evasion charges on June 3. The DA’s office said it would not discuss details of that case until then.

The brokers are part of a group of 31 real estate professionals in the state who the DA’s office said failed to report more than $13 million in income and evaded more than $650,000 in state income taxes.

As independent contractors, real estate brokers are responsible for filing their own personal income taxes. Brokers who do not file returns for three consecutive tax years face felony charges, while those who fail to file in a single tax year or non-consecutive years face misdemeanor charges. The first three misdemeanor charges equal one felony count.

As reported by The Real Deal in March, convictions of felony charges could to lead as much as four years in a state prison, while misdemeanor charges could lead to prison sentences of up to a year.

Two brokers alleged to have been delinquent in tax payments work for Brown Harris Stevens.

High-profile luxury broker Kathy Sloane, a senior vice president and managing director at Brown Harris Stevens, is suspected of tax evasion but has not yet been arraigned on charges.

Scott Moore, a Brown Harris Stevens senior vice president, was arraigned on five felony counts in court last Tuesday. He allegedly evaded paying taxes between 2000 and 2006. 

Another defendant, Sotheby’s International Realty’s Camille McKinley, an associate broker, was charged with five felonies for delinquency between 2000 through 2006, the DA’s office said. She is slated to return to court next Monday.

Joseph Carris, an associate broker at Warburg Realty Partnership, was charged on April 15 with two felonies for tax evasion between 2002 and 2005. He pled guilty to a misdemeanor, paid fines and filed his real tax returns. 

Sarah Brady, an office manager at Coldwell Banker De Simone Realty in Staten Island, also made the list of defendants. She has not yet been charged. 

Brooklyn-based broker Solomon Knopf was charged with a felony for failure to file tax returns between 2004 and 2006. His case is still pending, the DA’s office said.
 
The lone commercial broker on the list, Richard Brickell, a vice president at Joseph P. Day Realty Corporation, was charged with two misdemeanor charges for evasion in 2005 and 2006. The charges were reduced last month.  

Editor’s note: On May 19, 2008, charges against McKinley were reduced to one misdemeanor. A motion was made by McKinley’s attorney, James Tully of DeGraff, Foy & Kunz, to adjourn in contemplation of dismissal, according to a letter Tully wrote to The Real Deal. The judge said he would take the motion under advisement. “It was noted in court that Ms. McKinley was in the process of preparing and filing all returns, and that all returns were filed on March 21, 2008,” Tully wrote.


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