Tax Accountant Pleads Guilty to Fraud Charges, DOJ Says

TAX ACCOUNTANT PLEADS GUILTY TO SCAMMING CLIENTS IN FRAUD AND MONEY LAUNDERING SCHEME

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today that SALVATORE ARENA pled guilty before United States District Judge Katherine Polk Failla to defrauding clients who trusted him to prepare and pay their taxes. ARENA misappropriated over $780,000 of client money for his own use.

U.S. Attorney Geoffrey S. Berman said: “As he admitted today, Salvatore Arena defrauded his clients and the United States by misappropriating money his clients intended would be used to pay their taxes. Arena now awaits sentencing for his serious crimes.”

According to allegations in the criminal complaint, the information, and other documents filed in federal court, as well as statements made in public court proceedings:

During the relevant time period, SALVATORE ARENA purported to offer tax services, including the preparation and payment of taxes, to clients of an accounting firm in Manhattan. Instead of making payments on behalf of those clients, as ARENA represented he would, he diverted client funds for his own use. ARENA executed this fraudulent scheme in two primary ways — first, by diverting pre-payments of taxes to his own tax account and later claiming illegitimate refunds, and second, by misappropriating tax payments clients had wired into a bank account controlled by ARENA.

ARENA defrauded numerous victims during the period from January 2014 through March 2019, and agreed as part of his guilty plea to forfeit $789,195.35 in United States currency, representing proceeds traceable to the charged offenses, and to pay restitution as ordered by the court.

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ARENA, 47, of Queens, New York, pled guilty to one count each of mail fraud, money laundering, and wire fraud, each of which carries a maximum sentence of 20 years in prison. The maximum potential sentences in this case are prescribed by Congress, and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. ARENA is scheduled to be sentenced by Judge Failla on December 13, 2019.

Mr. Berman praised the outstanding investigative work of Special Agents from the U.S. Attorney's Office for the Southern District of New York, the U.S. Treasury Inspector General for Tax Administration, Office of Investigations, the New York State Department of Taxation and Finance, Office of Internal Affairs, and the New York City Department of Finance, Office of Tax Enforcement.

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If you believe you have been a victim of the scheme described above, including a victim entitled to restitution, and you wish to provide information to law enforcement and/or receive notice of future developments in the case or additional information, please contact Wendy Olsen-Clancy, the Victim Witness Coordinator at the United States Attorney's Office for the Southern District of New York, at 866-874-8900, or wendy.olsen@usdoj.gov. You may also report it to Criminal Investigator John Patterson at (518) 451-1566 or John.Patterson@tax.ny.gov.

The prosecution of this case is being handled by the Office's General Crimes Unit. Assistant United States Attorney Jarrod L. Schaeffer is in charge of the prosecution.