Former North Hempstead Dem Leader Arrested on Tax Fraud Charges

North Hempstead’s former Democratic Leader Gerard Terry was arrested Tuesday morning on tax fraud charges after he failed to file and pay New York State personal income taxes for tax year 2010, according to Nassau County District Attorney Madeline Singas.

Terry, 61, of Roslyn Heights, surrendered himself to DA investigators and was charged with third-degree criminal tax fraud.

"Cheating on taxes is always wrong, but it's especially egregious when much of the undeclared income was paid from taxpayer-funded government accounts," Singas said in a press release. "These allegations underscore the need for robust vetting practices at every level of government to ensure that taxpayers hire only those fit for public service.”

The DA’s office began an investigation on Terry after he issued a public statement in January explaining that he “owes a lot of back taxes” to the IRS and admitted to “having a problem.”

In the statement, Terry said he failed to pay “some one million plus dollars, which has accumulated over more than a decade” to the IRS and that he “need[s] to tackle [his] New York state arrears.”

A section of the statement found on CBS 8’s website is below. Read the full statement on CBS 8 here.

“As many of us are getting our W2 forms in anticipation of filing our taxes this spring it would be helpful to remember that core philosophy of Alcoholics Anonymous that the first step on the road to recovery is to admit you have a problem.

I owe back taxes to the IRS.

A lot of back taxes.

In fact, I currently have a formal offer pending with the IRS for a structured program to address an obligation of some one million plus dollars, which has accumulated over more than a decade. When you add in the penalties and interest, it’s considerably more. And then I need to tackle my New York state arrears.”

The DA investigation revealed Terry has earned an average annual income of $200,000 to $300,000 since 2000 and has regularly failed to voluntarily pay New York State income taxes since then.

According to the DA, Terry is charged for failure to file a New York State personal income tax return for the tax year 2010, in which he had an income in excess of $250,000 and a State tax liability of $13,000.

The investigation also revealed that despite the IRS communicating with Terry at the end of 2011 regarding his non-filing and delinquency for tax years 2009 and 2010, he allegedly still had not filed federal or state personal income tax returns or paid any of the taxes due, the DA says

Following his public statement, Terry was called to step down as Democratic Party Chairman of the Town of North Hempstead by Town Supervisor Judi Bosworth. The DA says Terry also had several paid positions with various governmental entities:

• He held positions with the Nassau County Board of Elections since 1998 with his most recent position being Assistant Counsel.
• He entered into contracts with the Town of North Hempstead since 2004 to serve as counsel in various capacities, including Town Attorney and counsel to the Board of Zoning Appeals and the Housing Authority.
• He entered agreements appointing him as legal counsel for the Roosevelt Public Library (in 2005), the Freeport Community Development Agency (in 2011) and the Long Beach Housing Authority (for two years starting in 2014).
• He served as the attorney for the Village of Manorhaven until 2012.

Terry has either been removed of stepped down from all the aforementioned positions. The investigation into additional tax-related crimes that may have been committed by Terry is ongoing.

Terry was released on his own recognizance under the conditions that he surrender his passport and not travel outside New York State. He is due back in court on Tuesday, April 26. Terry faces a maximum sentence of 2-⅓ to seven years in prison if convicted.

The NCDA investigation into additional tax crimes or tax-related crimes possibly committed by Terry is ongoing. The DA also said more tax-related arrests, for cases independent of Terry, are expected this week.

The investigation was conducted with the assistance of the New York State Department of Taxation and Finance (NYSDTF).

Image via NCDA