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Date: 09-25-2020
Case Style:
Case Number: 1:18-cr-00693-RMB
Judge: Richard M. Berman
Court: United States District Court for the Southern District of New York (New York County)
Plaintiff's Attorney: United States District Attorney’s Office, New York, New York
Defendant's Attorney:
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Description: New York, NY - Criminal Defense Lawyer, Wire Fraud
The United States of America charged Richard Gaffey, a/k/a Dick Gaffey, age 76, with wire fraud, tax fraud, money laundering, aggravated identity theft, and other charges.
Defendant, a U.S. citizen and resident of Medfield, Massachusetts, pleaded guilty to one count of conspiracy to commit tax evasion and to defraud the United States; one count of wire fraud; one count of money laundering conspiracy; four counts of willful failure to file Reports of Foreign Bank and Financial Accounts, FinCEN Reports 114; and one count of aggravated identity theft. In addition to 39 months’ imprisonment, U.S. District Judge Richard M. Berman ordered Gaffey to serve three years of supervised release, to pay forfeiture in the amount of a sum of $5,373,609 and restitution in the amount of $3,459,315, and to pay a fine in the amount of $ 25,000.
Gaffey was charged along with Harald Joachim von der Goltz, Ramses Owens, and Dirk Brauer in connection with a decades-long criminal scheme perpetrated by Mossack Fonseca & Co. (Mossack Fonseca), a Panama-based global law firm, and its related entities. Gaffey previously pled guilty to the charges, and was sentenced today by U.S. District Judge Richard M. Berman.
According to the allegations contained in the indictments, other filings in this case, and statements during court proceedings, including Gaffey’s guilty plea and sentencing hearings:
Since at least 2000 through 2018, Gaffey conspired with others to defraud the United States by concealing his clients’ assets and investments, and the income generated by those assets and investments, from the IRS through fraudulent, deceitful, and dishonest means. During all relevant times, Gaffey assisted U.S. taxpayers who were required to report and pay income tax on worldwide income, including income and capital gains generated in domestic and foreign bank accounts.
Gaffey helped those U.S. taxpayers evade their tax reporting obligations in a variety of ways, including by hiding the beneficial ownership of his clients’ offshore shell companies and setting up bank accounts for those shell companies. These shell companies and bank accounts made investments totaling tens of millions of dollars. For one U.S. taxpayer, Gaffey advised how to covertly repatriate approximately $3 million to the United States by reporting to the IRS a fictitious company sale that never actually occurred to evade paying the full U.S. tax amount. Gaffey was assisted in this scheme through the use of Mossack Fonseca, including Ramses Owens, a Panamanian lawyer who previously worked at Mossack Fonseca.
Gaffey was the U.S. accountant for Harald Joachim von der Goltz. From 2000 until 2017, von der Goltz was a U.S. resident and was subject to U.S. tax laws, which required him to report and pay income tax on worldwide income. In furtherance of von der Goltz’s efforts to conceal his assets and income from the IRS, Gaffey falsely claimed that von der Goltz’s elderly mother was the sole beneficial owner of the shell companies and bank accounts at issue because, at all relevant times, she was a Guatemalan citizen and resident, and – unlike von der Goltz – was not a U.S. taxpayer. In support of this fraudulent scheme, Gaffey submitted the name, date of birth, government passport number, address, and other means of identification of von der Goltz’s elderly mother to a U.S. bank in Manhattan.
Von der Goltz was previously sentenced by Judge Berman principally to 48 months’ imprisonment. Owens and Brauer remain at large.
The Justice Department praised the outstanding investigative work of IRS-Criminal Investigation and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. The Justice Department’s Tax Division and Office of International Affairs, the FBI, and law enforcement partners in France, the United Kingdom, and Germany provided significant assistance.
This case is being prosecuted by Trial Attorney Michael Parker of the Criminal Division’s Money Laundering and Asset Recovery Section of the Justice Department and Assistant U.S. Attorneys Eun Young Choi and Thane Rehn of the Manhattan U.S. Attorney’s Office’s Complex Frauds and Cybercrime Unit and Money Laundering and Transnational Criminal Enterprises Unit, with substantial support from previous co-counsel, Trial Attorney Parker Tobin of the Tax Division.
Outcome: The charges as to Owens and Brauer are merely accusations, and they are presumed innocent unless and until proven guilty.
IMPRISONMENT: 39 months as follows: 15 months on counts one through seven to run concurrently with one another plus 24 months to run consecutively on count eight. SUPERVISED RELEASE: three years on counts one through seven and one year on count ei
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