Nassau CPA Lied On Clients' Taxes, Defrauded Governtment: DA

A Woodmere-based accounting firm was arraigned today on charges that it filed fraudulent New York State tax returns for more than 250 clients.

Kenneth Erdheim, CPA, PC, was charged with second-degree criminal tax fraud. The corporation is due back in court on March 5. If convited, it will have to pay $32,667 in fines.

“The tax returns of more than 250 clients were allegedly mishandled by this company, costing the government nearly $130,000 in revenue,” said Nassau County District Attorney Madeline Singas. “Due to this company’s alleged misdeeds, their clients now must repay that money to New York State even though they were unaware of the mistakes on the returns. We encourage everyone to research multiple tax preparers and to check their qualifications before filing returns this tax season.”

According to Singas, starting in 2018, the New York State Department of Tax and Finance suspected fraud in the 2016 personal income tax returns submitted by Kenneth Erdheim, CPA, PC.

The department investigated and found that 267 returns filed by the company claimed a deduction that the filers were not entitled to, Singas said. These fraudulent filings cost the state $129,638.

The state Department of Tax and Finance gave the case to the Nassau DA in May, 2018.

Kenneth Erdheim and his company did not benefit from the fraud, Singas said, and his clients were not aware it was taking place. Even so, they are responsible for paying the money owed to the government. The company will be responsible for paying any accrued interest, Singas said.