Albany, NY - June 1, 2018 - Attorney General Barbara D. Underwood and Acting Commissioner of Taxation and Finance Nonie Manion announced today the guilty plea of Andreea Dumitru, 43, of New York, NY for her role in assisting “Taxi King” Evgeny Freidman’s failure to remit to the New York State Department of Taxation and Finance $5 million in 50-cent MTA surcharges between 2012 and 2015. During this time period, Dumitru — the former CFO of Taxiclub Management Inc. — assisted Freidman with managing a fleet of over 800 medallion taxicabs out of locations in Manhattan, Brooklyn, Woodside, and Long Island City. Today, in Albany County Court, Dumitru, who is also a licensed attorney, pleaded guilty to Criminal Tax Fraud.
“As we’ve detailed, Andreea Dumitru partnered with Evgeny Freidman to steal from New Yorkers – lining their pockets with tax dollars that should have been invested in our transit system,” said Attorney General Underwood. “We will continue to hold accountable anyone who tries to game the system for their own benefit.”
This case was the result of a joint investigation by the New York State Attorney General’s Office and the New York State Department of Taxation and Finance (“DTF”). The Attorney General’s indictment, filed in Albany County Court in June 2017, charged Dumitru, together with Taxiclub Management CEO Evgeny Freidman, with four counts of Criminal Tax Fraud in the First Degree and one count of Grand Larceny in the First Degree, all class B felonies.
According to statements made by prosecutors and documents filed in court, Freidman’s Taxiclub Management, Inc. oversaw the operation of four NYC taxicab medallion management agencies: 28th Street Management Inc. (located at 313 10th Ave., New York, NY); Downtown Taxi Management LLC (located at 330 Butler St., Brooklyn, NY); Tunnel Taxi Management LLC (located at 44-07 Vernon Blvd., Long Island City, NY); and Woodside Management Inc. (located at 49-13 Roosevelt Ave., Woodside, NY). Dumitru was CFO of Taxi Club Management, an entity which controlled 28th Street Management, Downtown Taxi Management, Tunnel Taxi Management, and Woodside Management.
Between at least January 2012 and December 2015, Freidman was also the beneficial and managing owner of over 120 companies, each of which held multiple taxicab medallions. Through these companies and the four managing agencies, Freidman served as both the licensed owner and managing agent of a fleet of over 260 medallion taxicabs. In addition to the hundreds of medallions he owned, Freidman’s managing agencies leased hundreds of additional medallions from other owners. Taxi Club Management Inc. and the four managing agencies controlled over 800 medallion taxicabs between 2012 and 2015.
During this four-year period, these taxicabs provided millions of rides to millions of New York City passengers. The vast majority of those rides were subject to a 50-cent New York State Tax known as the “MTA Tax,” which was automatically collected from passengers as part of their fare. Instead of remitting that tax to the DTF as required by law, Freidman and Dumitru orchestrated a scheme to withhold that money by improperly filing returns, failing to file returns, failing to remit the tax on filed returns, and by filing falsified returns, which underreported the true number of taxable rides. Through this scheme, Freidman and Dumitru withheld nearly $5 million in taxes from the State of New York that had been collected from passengers.
Today, in Albany County Court before the Honorable Peter A. Lynch, Dumitru pleaded guilty to one count of Criminal Tax Fraud in the Third Degree, in violation of Tax Law Section 1804, a class “D” felony.
Pursuant to her guilty plea, Dumitru admitted that from January 1, 2015 through February 4, 2016, she and Freidman received MTA surcharge taxes collected from taxicab customers in the City of New York on behalf of taxicab medallions Freidman owned or managed, and intentionally failed to remit those moneys to DTF. In particular, over the time-period of January 1, 2015 through February 4, 2016, Dumitru and Freidman received over $10,000 in MTA surcharge taxes collected from taxicab customers in the City of New York on behalf of taxicab medallions Freidman owned or managed, and intentionally failed to remit those moneys to DTF. Dumitru further admitted that she and Friedman knew that they were obligated to remit this money to DTF and willfully failed to remit the money with intent to defraud DTF.
As part of her plea today, Dumitru agreed to pay $25,000 in criminal restitution to the New York State Tax Department, and to cooperate with ongoing civil investigations by the Attorney General’s Office related to Freidman’s taxicab businesses. Should Dumitru fully comply with the terms of her agreement, she will be permitted to withdraw her felony plea and enter a plea of guilty to the lesser crime of Criminal Tax Fraud in the Fifth Degree, a class A misdemeanor, and receive a sentence of 3 years’ probation.
Freidman previously pleaded guilty to the crime of Criminal Tax Fraud in the Second Degree, a class “C” felony, agreed to pay $1 million in restitution prior to sentencing, and confessed judgment for the remaining $4 million in restitution. Freidman’s sentencing is scheduled for May 22, 2019.
The Attorney General’s Taxpayer Protection Bureau is conducting an ongoing parallel civil investigation into Mr. Freidman’s conduct. Separately, the Attorney General’s Labor Bureau has investigated Freidman’s failure to properly pay drivers; those investigations resulted in a 2013 settlement for $1.2 million and a 2016 consent order in New York Supreme Court, requiring Freidman and four of his taxi medallion management agencies to pay over $275,000 in damages and fines and to hire an independent monitor to examine compliance with TLC driver-related rules.
The Office of the Attorney General thanks the New York State Department of Taxation and Financing’s Criminal Investigations Division for its invaluable assistance on this case.
The criminal case is being handled by Assistant Attorneys General John R. Healy and Benjamin S. Clark of the Criminal Enforcement and Financial Crimes Bureau. The Criminal Enforcement and Financial Crimes Bureau is led by Bureau Chief Stephanie Swenton and Deputy Bureau Chief Joseph D’Arrigo. The Criminal Division is led by Margaret Garnett, Executive Deputy Attorney General for Criminal Justice.
The Attorney General’s investigation was conducted by Investigators Mark Terra and Anna Ospanova and Deputy Chief Antoine Karam. Forensic accounting was performed by Associate Forensic Auditor Meaghan Scotellaro and Forensic Auditor Marcos Perez. The Investigations Bureau is led by Chief Dominick Zarrella. The Forensic Audit Section is led by Chief Auditor Edward J. Keegan.