Trumbull Accontant Pleads 'Guilty' to Assisting in Property Management Scheme
Accountant pleads to tax charge after helping defraud a property owner of $275,000 and the IRS of almost $72,000.
While managing the books for ACT Builders, Inc., which was contracted to serve as a property manager for an apartment complex and several other residential units, Ragonese prepared monthly rent rolls and tracked other services performed by owner Anthony Testo.
From approximately January 2007 to August 2010, Testo and ACT Builders, with Ragonese’s assistance, defrauded the property owner by submitting fraudulent rent rolls that misrepresented certain rental units as vacant with no rent due when, in fact, the apartments were occupied and rent had been collected. The rent rolls also misrepresented that the rent due and collected for certain rental units was lower than the amount that was actually collected.
Testo deposited rental income that was due to the property owner into both his personal bank account and the ACT Builders bank account.
Through this scheme, and also by submitting fraudulent subcontractor invoices to the property owner, Testo defrauded the property owner of at least $275,000.
For the 2007 through 2010 tax years, Ragonese prepared Testo’s federal tax returns, which failed to report the rental income that Testo kept for his own use and benefit. This resulted in a tax loss to the IRS of $71,795.
Ragonese pleaded “guilty” to one count of aiding and assisting the preparation and filing of a false tax return, an offense that carries a maximum term of imprisonment of 3 years. He is scheduled to be sentenced by U.S. District Judge Robert N. Chatigny on Oct. 2.
Testo pleaded “guilty” on June 20 to one count of conspiracy to commit wire fraud and one count of assisting in the preparation and filing of a false tax return. Testo also admitted that he failed to report his fraudulent income on his 2007 through 2010 personal federal income tax returns.
In addition, Act Builders pleaded guilty to one count of conspiracy to commit wire fraud.
Testo and Act Builders are currently scheduled to be sentenced on Sept. 2.