Father and son hotel developers were convicted of tax fraud after they were accused of concealing more than $150 million in assets and failing the report $49 million in income.
Mauricio Cohen Assor, 77, and his son, Leon Cohen-Levy, 46, of Miami Beach, Fla., have been convicted of conspiring to defraud the United States and filing false tax returns. After a month-long trial, a Fort Lauderdale jury found the defendants guilty of conspiring to defraud the United States and filing false tax returns. The defendants concealed more than $150 million in assets, including Miami Beach mansions, yachts, luxury automobiles, and bank accounts containing tens of millions of dollars. The defendants also failed to report more than $49 million in income to the Internal Revenue Service.
Mauricio Cohen was found guilty of conspiring to defraud the United States and two substantive counts of filing a false tax return. Leon Cohen was found guilty of conspiring to defraud the United States and two substantive counts of filing a false tax return. He was acquitted of one additional substantive count charging the same.
Sentencing is scheduled for Dec. 17, 2010 before U.S. District Judge William J. Zloch in Fort Lauderdale, Florida. At sentencing, both defendants face a maximum of eleven years imprisonment. Each defendant will also be liable to the IRS for unpaid taxes, penalties, and interest. Both defendants have been detained since their arrest on April 15, 2010.
According to court documents and trial testimony, the two men and their co-conspirators used nominees and shell companies formed in so-called tax haven jurisdictions, including the Bahamas, the British Virgin Islands, Panama, Liechtenstein and Switzerland, to conceal their assets and income from the IRS. To further conceal their assets and income from the IRS, evidence produced during trial showed the men also provided false and forged documents to banks, opened bank accounts in the name of nominees, titled their personal residences and luxury vehicles in the name of shell companies, filed fraudulent tax returns, failed to file other tax returns, suborned perjury in a civil matter pending before the New York Supreme Court, and induced other individuals to make false statements to federal law enforcement agents. Among the nominees used by the defendants were their personal secretary and their limousine driver.
Cohen Assor and Cohen-Levy were the developers and owners of several residential hotels known by the trade name Flatotel International. Flatotel had locations in France, Spain, Brussels, and New York City. In 2000, the defendants sold their New York hotel and generated proceeds of $33 million. The defendants directed that the sale proceeds be transferred to a bank account at HSBC in Switzerland, which account was opened in the name of a Panamanian bearer share company. The income earned from the sale of the hotel was never reported on U.S. tax returns by the Cohens or by any of their related entities.
According to court documents and trial testimony, among the assets and income the Cohens concealed from the IRS are a $45 million investment portfolio, a condominium at Trump World Tower in New York City valued as much as $10 million, the personal residence of Mauricio Cohen Assor on Fisher Island in Miami Beach worth approximately $20 million, the personal residence of Cohen Levy in Miami Beach worth approximately $26 million, the personal residence of the daughter of Cohen Assor in Bal Harbor, Fla., commercial properties valued in excess of $55 million in Miami Beach, luxury vehicles, including a Rolls Royce Phantom, a Porsche Carrera GT, a Bentley, a Ferrari Testarossa, a BMW Z8, a Dodge Viper, a limousine and a $1.2 million helicopter.
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