Insurance salesman tries to scam the IRS for $14 million refund - gets prison term

Not only did the salesman request a fraudulent refund, he also mailed false tax returns

Insurance salesman tries to scam the IRS for $14 million refund - gets prison term

Insurance News

By Lyle Adriano

An insurance salesman in Newington, CT has been sentenced to 70 months in prison for attempting to bilk the IRS out of $14 million.

According to the Tax Division of the US Justice Department, Terry DiMartino was convicted in March 2016 of one count of corruptly interfering with the due administration of the internal revenue laws, two counts of filing false tax returns and five counts of willfully failing to file tax returns.

DiMartino, 64, was also sentenced to one year of supervised release, Hartford Business reported. Prosecutors added that he was also ordered to pay more than $658,500 in restitution to the IRS.

Investigators said DiMartino failed to file accurate tax returns or pay the taxes owed on selling insurance for a number of in-state insurers and brokers – this allowed him to earn millions of dollars in untaxed insurance commissions. Officials noted that DiMartino had perpetrated this scheme since 1996.

After being confronted by investigators for his suspected crime, DiMartino attempted to thwart the IRS by mailing false documents – including three false tax returns for the 2007 tax year. One of the tax returns even requested a fraudulent $14 million refund.

To bypass the IRS’s assessment, collection, and investigation, DiMartino also mailed the agency false and threatening letters. He also sent threatening letters to insurance companies that were aiding the IRS’s investigations.

DiMartino used nominee entities to divert his insurance commissions to hide his assets and prevent the IRS from collecting on his tax liabilities, officials added.

 

 

 

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