Edward Tutunjian, one of the largest owners of Boston cab medallions, agreed to plead guilty to payroll tax evasion, employing illegal aliens and failing to pay overtime wages today and agreed to pay more than $2.3 million in fines and restitution, the US Attorney's office reports.
The Globe reports prosecutors are also asking for a prison term of at least two years.
According to the US Attorney's office:
Since approximately 1972, Tutunjian and EJT have operated the Boston Cab taxicab business in the greater Boston area. By 2014, Tutunjian and EJT owned approximately 372 taxi medallions – a government license permitting a car to be used to transport passengers for hire – which they leased to drivers and for which Tutunjian and EJT received millions of dollars in gross revenues each year, mostly in cash. Although the taxi drivers were self-employed, Tutunjian and EJT directly employed mechanics, dispatchers, office workers, and others. It is alleged that a number of those employees were undocumented aliens who, because of that status, were not authorized to work in the United States.
Tutunjian allegedly concealed the size of the company payroll from the IRS, and thereby concealed the amount of federal employment taxes he and EJT would be responsible for paying. He did this by paying employees entirely or partially in cash and keeping such cash payments off the books. By doing this, he ensured there would be no record of cash payments that could be inspected by the IRS. Employees who were illegal aliens, and therefore not authorized to work in the United States, were allegedly paid entirely in cash. EJT did not issue W-2 forms to those employees and did not withhold or pay federal income tax, Social Security tax, or Medicare tax with regard to those illegal alien employees.
Other employees who were citizens or permanent resident aliens received their wages partly in cash and partly by check. Tutunjian filed quarterly employment tax returns for EJT which did not include the amounts which had been paid in cash to EJT employees. In this way, EJT evaded, and aided and abetted its employees in evading, approximately $739,204 in taxes from 2009 to 2013.