June 12, 2017 By Christian Murray
The ‘Taxi King’ and a Sunnyside resident who operate agencies in Woodside and Long Island City have been indicted for failing to pay $5 million in MTA taxes.
Evgeny Freidman, 46, and Andreea Dumitru, 41, from Sunnyside, who operate Taxiclub Management, a company with a fleet of more than 800 medallion taxi cabs with locations in Manhattan, Brooklyn, Woodside and Long Island City, have been charged for failing to pay the taxes generated from a 50-cent MTA surcharge per cab ride between 2012 and 2015.
According to the charges, the pair avoided paying the surcharge by failing to file tax returns or filing falsified returns which under-reported the actual number of taxable rides.
“The ‘Taxi King’ built his empire by stealing from New Yorkers – pocketing money that should have instead been invested in our transportation system,” said Attorney General Schneiderman in a statement.
“This indictment exposes a blatant scheme to short-change the Metropolitan Transit Authority, the transportation infrastructure relied on by millions of New Yorkers,” said Acting Commissioner of Taxation and Finance Nonie Manion. “Hundreds of honest taxi drivers did their part in collecting the proper fare, however Mr. Freidman and his business partner are accused of manipulating tax filings to put this money right into their own pockets.
Friedman, the CEO, and Dumitru, the CFO, have both been charged with four counts of Criminal Tax Fraud and one count of Grand Larcency and face a maximum sentence of 8 1/3 to 25 years imprisonment on each charge.
Freidman has faced mounting legal troubles as he has struggled to maintain his business, as the growth of ride-hailing apps like Uber and Lyft has sent the value of a medallion plummeting, from a high of $1.3 million in 2013 to less than $250,000 in 2017.
An investigation by the attorney general’s labor bureau over payment of drivers resulted in a 2013 settlement for $1.2 million and a 2016 consent order requiring Freidman and four of his medallion management agencies—including the Woodside and Long Island City locations– to pay over $275,000 in damages and fines.