New Jersey Attorney General Peter Harvey announced that a California chiropractor and his sister who resides in New Jersey have pleaded guilty to various tax violations and related charges for reportedly cheating the State of New Jersey out of more than $67,000 in business and income taxes. The complicated conspiracy was designed to avoid paying thousands of dollars in New Jersey corporate business and income taxes.
Vaughn McKoy, director, Division of Criminal Justice and Insurance Fraud Prosecutor Greta Gooden Brown, said that Richard J. Nardone, 46, of San Diego, pled guilty before Union County Superior Court Judge Scott Moynihan to charges of filing false and fraudulent New Jersey Income Tax returns, failure to pay New Jersey Gross Income Tax with intent to evade, and misconduct by a corporate official. Nardone’s sister, Donna M. Januik, 51, of Mountainside, Union County, pled guilty to filing false and fraudulent New Jersey Income Tax returns and failure to pay New Jersey Gross Income Tax with intent to evade.
Nardone and Januik are scheduled to appear before Judge Moynihan on Dec. 3 for sentencing.
According to Gooden-Brown, Nardone and Januik were charged via a State Grand Jury indictment returned on Feb. 10, 2004. At the guilty plea hearing, Nardone reportedly admitted that between Jan. 1, 1998 and May 31, 1999, he transferred and withdrew large sums of money from his chiropractic business and from related medical treatment, diagnostic, and rehabilitation facilities he owned, operated, or controlled. It is charged that Nardone withdrew or transferred more than $67,000 between businesses without paying New Jersey Income taxes.
The investigation identified the location of Nardone’s chiropractic office as 150 Main St., Orange, Essex County. Nardone’s related businesses are identified as: Professional Medical Technologies Inc. (PMT), Mountainside, Union County; Camino Rehabilitation Inc., 765 Mountain Ave., Springfield, Union County; Hermosa Medical Services Inc., Mountainside; Advanced Diagnostic Inc., 68a Woodside Gardens, Roselle Park, Union County; and Medical Diagnostic Inc., in Mountainside.
The indictment alleged that Januik operated a billing and collection agency known as ZNS Billing. During the course of the investigation, Division of Criminal Justice – Office of Insurance Fraud Prosecutor and Division of Taxation investigators seized financial books and records relating to the case. Shortly thereafter, the chiropractic practice and the related businesses ceased operations.
“During the course of conducting an insurance fraud investigation into the insurance billing practices of the defendant, an analysis of bank and financial records uncovered possible state tax violations,” Brown said. “Past investigative experience has revealed that insurance fraud can take the form of public and official corruption, as well as other crimes. In this case, the insurance fraud investigation resulted in the indictment for state tax violations.”