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A.G. Schneiderman & Acting Tax Commissioner Manion Announce Indictments Charging Nassau County Collision Repair Shops And Owner With Tax Fraud And Insurance Fraud

News from Attorney General Eric T. Schneiderman

FOR IMMEDIATE RELEASE
February 2, 2017

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A.G. SCHNEIDERMAN & ACTING TAX COMMISSIONER MANION ANNOUNCE INDICTMENTS CHARGING NASSAU COUNTY COLLISION REPAIR SHOPS AND OWNER WITH TAX FRAUD AND INSURANCE FRAUD

Defendants Allegedly Stole Over $480,000 In Sales Tax; Collision Shop Owner And His Wife Also Allegedly Failed To Remit Personal Income Taxes Totaling Over $160,000

NEW YORK - Attorney General Eric T. Schneiderman and Acting Commissioner of Taxation and Finance Nonie Manion announced the arrest of Jose Cardona, 38, on four separate indictments related to his ownership and operation of two Nassau County collision repair shops. Jose Cardona's wife, Veronica Cardona, 38, and employee Peter Bifolco, 35, were also charged. The indictments were unsealed late Wednesday.

Jose Cardona is the owner and operator of two collision centers:  No Limit Auto Body, Inc., also known as Perry’s Hub Auto Care, located at 10 Jerusalem Avenue in Hempstead, NY (“No Limit”); and Henry Street Auto Body, Inc., also known as No Limit Auto Body II (“No Limit II”), located at 110 Henry Street in Freeport, NY.  According to the prosecution, Jose Cardona and No Limit allegedly collected but failed to remit to New York State over $410,000 in sales taxes between June 2010 and June 2016, and Jose Cardona and No Limit II allegedly collected but failed to remit over $70,000 in sales tax between June 2011 and December 2015.

Prosecutors further allege that Jose Cardona and his wife, Veronica Cardona, filed a false personal income tax return for 2011 and failed to file personal income tax returns for 2012 and 2013, thereby underpaying over $160,000 in personal income taxes.  Additionally, prosecutors allege that Jose Cardona, No Limit, and employee Peter Bifolco committed felony insurance fraud by allegedly adding additional damage to a car brought to the shop for repair and then billing for over $3,000 in unnecessary repairs.

“It’s unacceptable for companies to steal hundreds of thousands of dollars in taxes while ordinary New Yorkers are following the law and paying their fair share,” said Attorney General Schneiderman. “There is one set of tax laws for everyone in New York, and my office will continue to hold accountable anyone who attempts to dodge their responsibility under the law.”

“When unscrupulous New Yorkers line their pockets with tax dollars, they’re not only stealing from the state, but more importantly they’re depriving their neighbors and local community of money used to fund valuable public programs and services,” said Nonie Manion, Acting Commissioner of the NYS Department of Taxation and Finance. “We will continue to work with the Attorney General’s office and all levels of law enforcement to ensure justice for violators and a level playing field for honest taxpayers."

The charges in the four indictments, unsealed yesterday in Nassau County Supreme Court, are as follows. The first indictment charges owner Jose Cardona and No Limit with: Grand Larceny in the Second Degree, a class C felony, in violation of New York State Penal Law § 155.40 (one count); Criminal Tax Fraud in the Second Degree, a class C felony, in violation of Tax Law § 1805 (three counts); Criminal Tax Fraud in the Third Degree, a Class D felony, in violation of Tax Law § 1804 (one count); Criminal Tax Fraud in the Fourth Degree, a class E felony, in violation of Tax Law § 1803 (one count); and Offering a False Instrument for Filing in the First Degree, a class E felony, in violation of New York State Penal Law § 175.35 (16 counts).

The second indictment charges Jose Cardona and No Limit II with Grand Larceny in the Second Degree in violation of New York State Penal Law § 155.40 (one count); Criminal Tax Fraud in the Third Degree in violation of Tax Law § 1804 (three counts); Criminal Tax Fraud in the Fourth Degree in violation of Tax Law § 1803 (one count); and Offering a False Instrument for Filing in the First Degree in violation of New York State Penal Law § 175.35 (14 counts).

The third indictment charges Jose Cardona and Veronica Cardona with: Criminal Tax Fraud in the Second Degree in violation of Tax Law § 1805 (two counts); Criminal Tax Fraud in the Third Degree in violation of Tax Law § 1804 (one count); and Offering a False Instrument for Filing in the First Degree in violation of New York State Penal Law § 175.35 (one count).

The fourth indictment charges Jose Cardona, No Limit and employee Peter Bifolco with one count each of: Grand Larceny in the Third Degree, a Class D felony, under Penal Law § 155.35(1); Insurance Fraud in the Third Degree, a Class D felony, under Penal Law § 176.20; Criminal Mischief in the Second Degree, a Class D felony, under Penal Law § 145.10; and Falsifying Business Records in the First Degree, a Class E felony, under Penal Law § 175.10.

In addition to yesterday’s arrests of the defendants on the above indictments, investigators from the Attorney General’s Auto Insurance Fraud Unit and from the New York State Department of Taxation and Finance’s Criminal Investigation Division executed search warrants at Jose Cardona’s two collision centers in Freeport and Hempstead.

The defendants were arraigned before the Hon. Meryl Berkowitz. Bail was set at $60,000 bond or $20,000 cash for Jose Cardona. Veronica Cardona and Peter BiFolco were both released on their own recognizance.  

If convicted of the top count charged, defendant Jose Cardona faces up to 5 to 15 years in prison; Peter Bifolco and Veronica Cardona each face up to 2 1/3 to 7 years in prison.

The charges against the defendants are allegations, and they are presumed innocent until proven guilty in a court of law.

This case was investigated by the Department of Taxation and Finance’s Criminal Investigations Division, and then referred to the Attorney General’s office for further investigation and prosecution.

The Attorney General thanks the Department of Taxation and Finance, the New York State Department of Financial Services, the National Insurance Crime Bureau and GEICO Insurance for their assistance in this investigation.

This case was investigated by Investigators Joseph Buffolino and Michael McNally and Senior Auditor Dmitry Temis of the Attorney General’s Auto Insurance Fraud Unit, under the direction of Supervising Investigators Edward Keegan and Natalie Shifrin and Deputy Chief Leonard D'Alessandro. The Investigations Bureau is led by Chief Dominick Zarrella.

The case is being prosecuted by Assistant Attorney General Timothy McNutt of the Auto Insurance Fraud Unit with the assistance of Legal Analyst Isabela Pena-Gonzalez and Supervising Legal Analyst Paul Strocko of the Criminal Enforcement and Financial Crimes Bureau. The Auto Insurance Fraud Unit is led by Chief Joseph G. D’Arrigo.  The Criminal Enforcement and Financial Crimes Bureau is led by Acting Bureau Chief Stephanie Swenton.