Two US businessmen convicted of evading taxes in chem sale

05 August 2005 17:10  [Source: ICIS news]

HOUSTON (CNI)--Two men have been convicted of conspiring to evade $1.9m (Euro1.5m) in excise taxes due to the sale of the ozone-depleting chemical trichlorotrifluoroethane (CFC-113), according to US justice officials.

 

Dov Shellef of Great Neck, New York, and William Rubenstein of Colts Neck, New Jersey, were found guilty by a jury on 28 July following a five-week trial, the Justice Department, US Attorney for the Eastern District of New York Roslynn Mauskopf and the Internal Revenue Service (IRS) said in a joint statement.

 

Shellof  was also convicted of 87 counts of wire fraud, tax evasion, subscribing to false tax returns and money laundering. Rubenstein was also convicted of wire fraud.

 

The US Clean Air Act banned continued importation and production of CFC’s in the US in 1996, though manufacturers were permitted to sell and export CFC that had been stockpiled prior to the ban. CFC’s are used primarily as refrigerants and industrial solvents but can also destroy ozone in the upper atmosphere.

 

CFCs are subject to a substantial excise tax to discourage their use.

 

Shellef and Rubenstein purchased CFC-113 and illegally diverted the product to a number of domestic customers, the Justice Department said.

 

To conceal the domestic sales, the men removed references to the original manufacturers on drums of the chemical and relabelled the product.

 

The defendants each face maximum sentences of 25 years in prison and $500,000 fines for the conspiracy and wire fraud convictions. Shellef also faces a maximum sentence of 20 years in the money laundering convictions and a fine of $500,000 or twice the property involved in the offences. Shellef also faces forfeiture of $1m in funds involved in the money laundering offences. 

By: Brian Ford
+1 713 525 2653

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