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Guilford: Louis DeMaio Sentenced to Prison for Tax Evasion Offense

Accountant, Louis DeMaio Sentenced to Prison for Tax Evasion and Obstruction Offenses

(STL.News) John H. Durham, United States Attorney for the District of Connecticut, announced that LOUIS DeMAIO, 70, of Guilford, was sentenced today by U.S. District Judge Janet Bond Arterton to 30 months of imprisonment, followed by one year of supervised release, for tax evasion and obstruction offenses.

Pursuant to the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), the sentencing occurred via videoconference.

According to court documents and statements made in court, DeMaio was employed as an accountant in East Haven and, from approximately 2010 to 2018, also operated Almatt LLC, a temporary employment agency that provided day laborers to construction companies.  Although DeMaio listed an individual (“Individual A”) on paper as the owner of Almatt, Almatt was effectively owned and run by DeMaio.

As part of Almatt’s operating procedures, Almatt invoiced construction companies for the cost of labor provided and, from the payments received from the companies, paid the employees for services rendered.  Almatt and DeMaio then provided the employees with W-2 forms reflecting that Almatt had undertaken required federal tax withholdings.  However, Almatt and DeMaio failed to withhold taxes and subsequently failed to pay over those withholdings to the IRS.  Almatt also never filed yearly income tax returns or quarterly 941 forms reflecting federal withholding and payroll taxes owed.

In addition, DeMaio issued hundreds of thousands of dollars of checks from Almatt made out to himself and to family members who did not work at the business.  From 2010 through 2018, DeMaio and his family received more than $2.5 million from Almatt.  DeMaio failed to report any of these distributions on his federal personal income tax returns.

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In 2015, the IRS initiated a civil examination of Almatt, and then expanded the examination to evaluate the completeness of DeMaio’s personal income tax returns.  When the IRS confronted DeMaio about his failure to report income paid to him by Almatt, DeMaio fabricated a story that a substantial portion of the payments he received from Almatt were loan repayments from Individual A. DeMaio also provided an IRS revenue agent with a false notarized document that DeMaio had created to support his story.  When the civil investigation was referred to IRS Criminal Investigation, DeMaio confirmed the fake loan repayment story in an interview with IRS special agents.

The investigation revealed that DeMaio underreported his income by more than $2.5 million.  The tax loss as a result of DeMaio’s criminal conduct is $1,132,398.

Judge Arterton ordered DeMaio to pay full restitution, as well as interest and penalties.

On August 11, 2020, DeMaio pleaded guilty to one count of tax evasion and one count of obstructing and impeding the due administration of Internal Revenue laws.

DeMaio, who is released on a $100,000 bond, is required to report to prison on May 12, 2021.

This matter was investigated by the Internal Revenue Service – Criminal Investigation Division.  The case was prosecuted by Assistant U.S. Attorney Christopher W. Schmeisser.

SOURCE: USDOJ.Today