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District Attorney

Posted on: January 30, 2018

District Attorney Hoovler Announces Prison Sentence in Tax Case

Fransicso Velez

Orange County News
For Immediate Release                                                           Contact: Christopher Borek
January 30, 2018                                                                     845.291.3276, 845.238.4245c

District Attorney Hoovler Announces Prison Sentence in Tax Case

 

Middletown Cigar Shop Owner Failed to Pay Over $50,000 in Tobacco, Sales and Income Taxes

 

Jumped Bail While Awaiting Sentence

 

Orange County District Attorney David M. Hoovler announced today that on January 29, 2018, Francisco Velez, 43, of Pinebush, was sentenced by Orange County Court Judge Craig Stephen Brown to one and one-half to four and one-half years in state prison for having committed the crime of Criminal Tax Fraud in the Fourth Degree.  On December 21, 2016, when Velez pleaded guilty to that charge, he admitted that he committed criminal tax fraud acts with the intent to evade taxes and failed to pay proper income taxes.  Velez was also ordered to pay restitution to the New York State Department of Taxation and Finance in the amount of $58,948.77.  As part of the plea agreement Velez paid $25,000 of the restitution on the day he was sentenced.

Velez was the owner and operator of OC Tobacco, Inc., which did business as the Havana House Cigar Lounge, on Main Street, in the City of Middletown.  A regulatory inspection by the New York State Department of Taxation and Finance revealed that there were over 3,500 untaxed cigars in the store. Subsequent investigation revealed that Velez had underreported not only his tobacco taxes, but his sales and personal income taxes as well. Velez was arrested by New York State Department of Taxation and Finance investigators on February 8, 2016.  Following his plea of guilty to the felony tax charge, Velez failed to return to court and was charged with Bail Jumping in the Second Degree, a class E felony.  On August 24, 2017, Velez pleaded guilty to Bail Jumping in the Second Degree.  Velez was sentenced to a one-year jail sentence with respect to that charge by Judge Brown on November 6, 2017.

District Attorney Hoovler thanked the New York State Department of Taxation and Finance for their investigation and the arrest in the case.

The case was prosecuted by Chief Assistant District Attorney Christopher Borek.

“Protecting the taxpayers’ money is a high priority,” said District Attorney Hoovler.  “Although no one enjoys paying taxes, those who illegally engage in tax evasion place an undue burden on those law-abiding taxpayers who do pay their fair share.  I commend the Criminal Investigations Division of the New York State Tax Department for their investigation of this case and their assistance during the prosecution.”

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