Feds: Restitution over $1 million ordered for Wallingford business owner

MERIDEN — The owner of a Wallingford business was ordered to pay more than $1 million in restitution after he was sentenced on a federal obstruction charge in court on Wednesday.

Donald Cariati Jr., 45, was sentenced to serve 12 months and one day in prison, followed by one year of supervision, according to a news release from U.S. Attorney for Connecticut John Durham.

Cariati also was ordered to pay a $95,000 fine, as well as more than $1 million in restitution.

The Meriden resident owns and operates Cariati Developers Inc, a snowplow and hauling business in Wallingford.

From 2013 to 2017, court documents showed, Cariati paid several employees with company checks, indicating they were independent contractors or subcontractors. Authorities said Cariati did so “to evade the responsibility to withhold and pay over taxes to the IRS.”

Cariati and his company did not issue 1099 tax forms to the employees they classified as subcontractors for certain years. He also told some individuals they were being paid off the books, according to federal authorities.

In late 2015, the IRS started an audit of Cariati’s company. Investigators said they found fraudulent invoices to be made available to an IRS agent.

Investigators also found that the company paid an invoice related to products for Cariati’s cigarette boat. During the audit, authorities said, Cariati told his accountant to give the IRS a false invoice to make it seem like the purchase was a business expense rather than a personal one.

The judge ordered Cariati to pay $1,077,048.99 in restitution. Officials said Cariati paid $1 million of that obligation on Tuesday.

He previously pleaded guilty to obstructing or impeding the due administration of the Internal Revenue laws on Feb. 28.

Cariati, who is free on bond, was told to report to prison in 90 days to begin his sentence.

Source Article