No Matter How You Slice It

16328212 - amount owe in the income tax return

According to the 2018 Pizza Power Report, the U.S. pizza market is worth $45.1 billion, with about $18.5 billion in revenue coming from independent operators. (As you might guess, competition is steep between the 75,243 pizzerias located across the nation.) The report also mentions that in 2017, more pizzerias closed their doors than were opened. Today’s pizzeria owner from Eagleville, Pennsylvania had to close two of his pizza restaurants and sell one not because of stiff competition, but because of tax fraud.

Today’s fraudster from Eagleville has the perfect name for a pizza restauranteur – Giuseppe. (Unfortunately, the Pizza Power Report doesn’t go in depth on the most common names for pizza business owners. Perhaps they’ll consider that for the next report.) Giuseppe operated four pizzerias located in Lafayette Hill, Philadelphia and Wilmington, Delaware. (The only one open is the Delaware location.)

Today’s fraud article explains that over six years, the owner of the establishments skimmed cash from his four businesses, then paid many of his employees “under the table.” (This allowed him to hide the fact that he was not paying any income or payroll taxes.) In all, Giuseppe failed to report approximately $2 million in gross receipts to the Internal Revenue Service (IRS). I bet your next question is, “What did he do with that $2 million?” Well, he spent it on himself while telling everyone that his businesses were barely profitable. (Obviously, they were not profitable because he really was not a very smart business operator.)

The 51-year-old pizzeria operator from Eagleville, Pennsylvania pleaded guilty to tax fraud and was sentenced to two years in federal prison, three years of supervised release and ordered to pay a special assessment of $1,100. He was also ordered to pay $463,738 in restitution to the IRS for filing false tax returns and failing to pay payroll taxes. Deceptive business owners can try to hide their crimes, but no matter how you slice the pizza, the IRS is always going to want their serving of tax revenue. (Perhaps he can work in the prison kitchen and provide oversight on pizza night. It’s going to be awhile before he’ll be able to order carryout.)

Today’s “Fraud of the Day” is based on an article entitled, “Eagleville-based pizza maker sentenced for tax fraud,” published by The Times Herald on November 27, 2018.

Giuseppe “Pino” DiMeo, 51, of Eagleville, was sentenced to 24 months in federal prison and ordered to pay $463,738 in restitution to the Internal Revenue Service for conspiring to defraud the IRS and filing false tax returns, authorities announced Tuesday.

DiMeo was also sentenced to serve three years of supervised release and ordered to pay a special assessment of $1,100.

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Larry Benson, Senior Director of Strategic Alliances, LexisNexis Risk Solutions - Government

Larry Benson is responsible for developing strategic partnerships and solutions for the government vertical. His expertise focuses on how government programs are defrauded by criminal groups, and the approaches necessary to prevent them from succeeding.

Mr. Benson has 30 years of experience in sales and business development. Before joining LexisNexis® Risk Solutions, he spent 12 years founding and managing two software technology startups. During the 1990s he spent 10 years as a Regional Director helping to grow a New England-based technology company from 300 employees to 7,000. He started his career with Martin Marietta Aerospace working on laser guided weapons and day/night vision systems.

A sought-after speaker and accomplished writer, Mr. Benson is the principal author of “Fraud of the Day,” a website dedicated to educating government officials about how criminals are defrauding government programs. He has co-authored WTF? Where’s the Fraud? How to Unmask and Stop Identity Fraud’s Drain on Our Government, and Data Personified, How Fraud is Changing the Meaning of Identity.

Benson holds a Bachelor of Science in Physics from Albright College, and earned two graduate degrees – a Master of Business Administration from Florida Institute of Technology, and a Master of Science in Engineering from Lehigh University.