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Exec to pay $11M, faces jail for tax fraud involving scrap

Keywords: Tags  scrap metal, tax evasion, Internal Revenue Service, John P. Gizzi, Rochester Machinery Suppliers, Lisa Gordon

PITTSBURGH — A Rochester, N.Y., businessman is facing up to six years in prison and a $500,000 fine, in addition to paying more than $11 million in restitution, after pleading guilty to tax crimes, including concealing payments for scrap metal.

John P. Gizzi, 64, who is scheduled to be sentenced Nov. 4 in U.S. District Court in New York, admitted filing false tax returns in 2008 and 2009, according to the U.S. Attorney’s Office. One of Gizzi’s companies, Rochester Machinery Suppliers Inc., pleaded guilty to aiding and abetting the preparation of a false tax return.

Gizzi will pay more than $7.6 million to settle related civil claims with the Internal Revenue Service, as well as more than $1.9 million in criminal restitution for taxes owed and forfeit $1.5 million, according to the U.S. Attorney’s Office, while Rochester Machinery Suppliers will pay a $500,000 fine for its role in assisting Gizzi.

Gizzi owned and managed several companies that he used to conceal income and inflate expenses. Two of Gizzi’s companies earned more than $1.9 million combined from scrap sales that were never reported as income. Neither the U.S. Attorney’s Office nor the court documents specify which two companies generated the scrap.

Gizzi could not be reached for comment.

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