Whistleblower Alerts State Under The New York False Claims Act That Rewards And Protects Tax Whistleblowers
NEW YORK – (RealEstateRama) — Attorney General Eric T. Schneiderman today announced a $1.1 million dollar settlement of a whistleblower case alleging that real estate developer Asher Roshanzamir wrongfully deferred payment of New York state and New York City income taxes. Federal law allows a seller of real property to defer paying income taxes on certain capital gains when he exchanges it for ‘like-kind’ real property, under certain conditions. An investigation by the Attorney General’s Office found that Mr. Roshanzamir wrongfully deferred payment of New York State and local income taxes by disguising withdraws of approximately $3.5 million from the like-kind exchange and by disguising approximately $5 million in equity contributions as loans.
Roshanzamir, a longtime figure in the New York real estate industry, is the principal of the real estate acquisition and investment firm, Zamir Equities LLC. The action began when a whistleblower became aware of Roshanzamir’s actions and filed a complaint in state Supreme Court in Manhattan. The Attorney General’s investigation of these claims showed that following what is called a ‘drop and swap’ section 1031 like-kind exchange of real estate properties, Roshanzamir wrongfully deferred payment of state and local taxes.
“There has to be one set of rules for everyone, no matter how rich or how powerful, and that includes big developers paying their fair share of taxes,” said Attorney General Schneiderman. “When the rich and powerful avoid paying their taxes, the burden unfairly falls on middle class New Yorkers and that is something I will not accept.”
This settlement is the latest tax-related recovery resulting from an action filed under the New York False Claims Act. The Act is one of the state’s most powerful civil fraud enforcement tools because it allows whistleblowers and the government to take legal action against companies or individuals that defraud the State or local governments. Persons found liable under the False Claims Act must pay treble damages, penalties, and attorneys’ fees. Under the False Claims Act, whistleblowers may be eligible to receive up to 30 percent of any money recovered by the government as a result of information they provide. The whistleblower in this action will receive $200,000 from the settlement proceeds.
Attorney General Schneiderman expresses his thanks to the whistleblower and his attorneys, and to the New York State Department of Taxation and Finance, for their assistance in bringing this case to resolution.
The investigation was led by Assistant Attorney General Sujata Tanikella and former Assistant Attorney General Daniel Smirlock of the Attorney General’s Taxpayer Protection Bureau.
Bureau Chief Thomas Teige Carroll and Deputy Bureau Chief Scott Spiegelman oversee the Taxpayer Protection Bureau within the Criminal Division of the New York Attorney General’s Office, which is led by Executive Deputy Attorney General for Criminal Justice Kelly Donovan.
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