Former North Hempstead Dem Leader Sentenced For Tax Evasion

North Hempstead's former Democratic Leader Gerard Terry was sentenced on Tuesday, May 29 to prison time and ordered to pay nearly $1 million in restitution for tax evasion, according to the United States Attorney for the Eastern District of New York.

Terry, 64, of Roslyn Heights, was sentenced to three years in prison, followed by three years of supervised release and was ordered to pay $992,057 in restitution and $31,000 in forfeiture. He pleaded guilty to the tax evasion charge in October 2017.

• Former North Hempstead Dem Leader Pleads Guilty To Tax Fraud Charges

Terry, an attorney licensed to practice in New York State, failed to pay $1.4 million in federal tax debt since 2010 despite earning $250,000 per year.

“Gerard Terry lived by a different standard than the taxpayers he served, taking money from them in payment for the numerous governmental and quasi-governmental jobs he held, while failing to pay the taxes he owed on those jobs,” United States Attorney Richard P. Donoghue said in a press release.

He failed to file personal Form 1040 tax returns and only filed them years later after he was aggressively pursued by the IRS, however the forms he filed still contained false information and failed to report income, the USAO reports. He has still never filed his returns for tax years 2009 and 2010.

“While reaping the benefits of a salary funded by taxpayer dollars, Gerard Terry rendered himself exempt from paying taxes on this earned income,” FBI Assistant Director-in-Charge William F. Sweeney said. “It seems today he has learned his lesson—the time to pay up has come.”

The DA investigation revealed Terry earned an average annual income of $200,000 to $300,000 since 2000 and regularly failed to voluntarily pay New York State income taxes from then until 2015. He was arrested in April 2016.

The DA says Terry also:

• Filed some New York State personal income tax returns for the period of 2000 to 2015, but never remitted the payments due for any of those returns. In addition to involuntary garnishments of his wages and income taxes automatically withheld from his salary, officials say Terry owes more than $100,000 in state income taxes over that period, not including penalties and interest.
• Failed to file a 2015 NYS income tax return or to request an extension on or before April 18, 2016, the deadline for tax year 2015 filing despite issuing a public statement in April 2016.
• Failed to report thousands of dollars of income on the New York State income tax returns which tax preparers filed on his behalf for tax years 2013, 2014, and 2015. The income reported on those returns were therefore understated and false, the DA says. This omission also affects the amount of tax liability actually due.

In 2016, Terry was called to step down as Democratic Party Chairman of the Town of North Hempstead by Town Supervisor Judi Bosworth. The DA says Terry also had several paid positions with various governmental entities:

• He held positions with the Nassau County Board of Elections since 1998 with his most recent position being Assistant Counsel.
• He entered into contracts with the Town of North Hempstead since 2004 to serve as counsel in various capacities, including Town Attorney and counsel to the Board of Zoning Appeals and the Housing Authority.
• He entered agreements appointing him as legal counsel for the Roosevelt Public Library (in 2005), the Freeport Community Development Agency (in 2011) and the Long Beach Housing Authority (for two years starting in 2014).
• He served as the attorney for the Village of Manorhaven until 2012.

Terry has either been removed of stepped down from all the aforementioned positions.

Officials also say Terry:

• Evaded the IRS’s attempts at levy collection, and cashed hundreds of wage and compensation checks worth over $500,000 instead of depositing them into checking or savings accounts where they could be seized. Terry, when he did deposit checks, would do so using the minimum amounts necessary to cover checks and payments for his own personal expenses so the IRS did not have sufficient funds to levy.
• Created an used a checking account under the name of a corporate shell account and had one of his employers make direct payments to his credit card instead of giving him a paycheck.
• Pressured colleagues at his various government and publicly funded jobs not to report wages paid to him and not to comply with IRS notices of levy.

Image via NCDA