Business & Tech

Rye Resident Accused of Defrauding State of More Than $380,000 in Sales Tax

Rye resident Steven Malkin has been arrested and charged with grand larceny and criminal tax fraud.

According to a release from the Westchester County District Attorney's office, Steven Malkin, 29 Chester Drive, Rye, was arrested and charged with one count of grand larceny in the second degree; one count of criminal tax fraud in the second degree; one count of offering a false instrument for filing; two counts of criminal tax fraud in the fourth degree; and one count of scheme to defraud in the first degree. The first two charges are class "C" felonies, the other four are class "E" felonies.

The District Attorney's office also alleges that Malkin's New Rochelle business Old Tyme Wine And Spirits, also called "Shore Road Liquors" and located at 422 Pelham Avenue, has been charged with one count of grand larceny in the second degree and one count of  criminal tax fraud in the second degree—both class "C" felonies.

According to the charges made by the district attorney, Old Tyme Wine and Spirits collected, but did not remit, sales taxes between January 1, 2006, and March 24, 2011.

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During the same time period, Malkin allegedly failed to pay sales tax collected by an online business called Law Guides Corp. of 34 East 39th St. in New York City. The website prepares paperwork for uncontested divorces. 

Altogether a sum of $380,884.46 of sales tax was allegedly collected and withheld through the two businesses.

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New York State Department of Taxation and Finance obtained a search warrant in April and determined through financial records that between January 1, 2006, through February 28, 2011, Old Tyme Wine and Spirits, Inc. had gross sales that were $4,506,085.80 more than were reported on its New York State quarterly sales tax returns.

Malkin has been released and is due in New Rochelle Court on June 16, 2011. According to the district attorney's office, Malkin faces a maximum of five to 15 years in state prison on the top counts of the complaint.


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