LI Woman Gets 33 Months In Prison For IRS Scheme: Prosecutors

MERRICK, NY — A Merrick woman was sentenced on Friday to 33 months in prison for illegally structuring financial transactions, corruptly obstructing the Internal Revenue Service and filing false tax returns, prosecutors announced.

Lorraine Pilitz was also ordered to $324,702 in restitution to the IRS and forfeited a commercial property in Lindenhurst.

She was convicted in November 2022 after a two-week trial.

"For years Pilitz thought she could get away with hiding substantial amounts of cash and
income, impeding the Internal Revenue Service, and cheating her employees, until a jury
found her guilty on all counts, said Breon Peace, U.S. Attorney for the Eastern District. "Today’s sentence sends a message to the defendant and others who place greed above following the law that this Office will vigorously prosecute those who commit tax fraud."

Between 2011 and 2013, Pilitz routinely structured cash deposits to avoid the required CTR filings – depositing cash amounts just under $10,000. As a result of Pilitz’s scheme, hundreds of thousands of dollars were concealed from the IRS, the US Attorney's office said.

As part of the same scheme to conceal her income, Pilitz also diverted hundreds of thousands of dollars of business checks into her and her family’s personal bank accounts and maintained “off-the-books” payrolls, Peace said.

The 65-year-old Pilitz was also known as "Lorraine Christie" and "Lorraine Storms."