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Long Island jeweler pleads guilty to tax evasion

By Michelle Graff
October 09, 2009

Albany, N.Y.--A Long Island, N.Y.-based jeweler charged as part of an ongoing sting operation involving sales tax collection pleaded guilty to sales tax evasion and was ordered to pay more than $200,000, according to a release from the state Department of Taxation and Finance.

Frucci's Jewelers Ltd., of Garden City South, N.Y., was sentenced recently in Nassau District Court and paid $207,596, which includes what it owed in back state and local taxes plus interest and penalties, the Oct. 2 release states.

According to the complaint, the store failed to collect $102,729 in state and local taxes from customer transactions dated between March 1, 2004 and Nov. 30, 2007.

The Frucci case is the first to arise from an undercover investigation that the state agency dubbed "Operation Goldrush."

Conducted by the state tax department's Special Investigations Unit in Nassau County and the department's Petroleum, Alcohol and Tobacco Bureau, Operation Goldrush launched in February 2008 and, at that time, had identified 11 jewelry stores that, according to the tax department, offered sales-tax-free purchases to undercover investigators if they paid with cash.

Operation Goldrush is continuing and more arrests are likely, the release states.

"Tax fraud deprives state and local governments of revenues that pay for necessary services such as health care, education and transportation, and our department is committed to pursuing those who steal taxes," Jamie Woodward, acting commissioner of the tax department, said in the release.

He also thanked Nassau County District Attorney Kathleen Rice and her staff for their "aggressive prosecution of this case."

Woodward added that the tax department offers programs such as the Voluntary Disclosure and Compliance Program to encourage delinquent taxpayers to become compliant without facing criminal prosecution or civil penalty.

For more information about these programs, visit NYSTax.gov.
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