Gideon Misulovin, a former New York business man on trial for tax evasion and fraud in 1996, appeared in US federal court on July 17, 2015 for the first time in 19 years.
On March 7, 1996, a jury convicted Mr. Misulovin of conspiracy to impede and impair the IRS in the ascertainment and collection of more than $6.5 million in federal motor fuel excise taxes, wire fraud and money laundering related to a scheme to conceal the unpaid diesel fuel excise taxes from state and federal tax authorities. The evidence at trial established that from 1988 through Jan. 31, 1993, Misulovin and his co-conspirators sold untaxed diesel fuel in a series of paper transactions using wholesale companies. Some of the companies were shams and called “burn” or “butterfly” companies. As part of the scheme, the sham company would assume the federal and state tax liability and then vanish, allowing the conspirators to keep the excise taxes they collected from truck stops and service stations.
Mr. Misulovin was free on $500,000 bail and although he attended every day of the trial, he failed to appear on the day of closing arguments. He was sentenced in abstenia to 10 years in prison, three years of supervised release, a $150,000 fine, and restitution in the amount of $200,000 to the United States and $100,000 to the state of New Jersey. In August 2014, Mr. Misulovin was detained in Greece, using an alias and an Israeli passport. He was subsequently arrested pursuant to a U.S. request for a provisional arrest, and after contested extradition proceedings, was found extraditable in 2015. Mr. Misulovin has been incarcerated since his return to the United States on July 16, 2015.
Click here for the Department of Justice’s full press release.