A Garden City business owner who allegedly failed to file tax returns and remit $188,000 in sales taxes for his auto body businesses, was arrested on felony grand larceny and other charges on Thursday, Nassau prosecutors said.
Douglas Donnelly, 50, was arraigned before Nassau District Court Judge Darlene Harris on charges of second-degree grand larceny, four counts of first-degree false instrument for filing and three counts of third-degree criminal tax fraud.
Donnelly, owner of three corporations -- Mineola-Jericho Auto Body Inc., Trinity Auto Body Ltd. and Trinity's Mineola Jericho Auto Body Ltd. -- was released on his own recognizance. If convicted of the top charge, Donnelly faces a maximum sentence of 5 to 15 years in prison. He is due back in court on April 16.DataLI crime statsPhotosRecent LI mug shots
Donnelly failed to file New York State tax returns and/or underreported sales in tax returns submitted on behalf of the three corporations from March 1, 2008, to Feb. 28, 2014, prosecutors said. During the same period, prosecutors said, he failed to remit a total of $188,198.93 in collected sales tax, prosecutors said.
The state Department of Taxation and Finance reviewed extensive records for all three companies and found additional monies that were not accounted for in their quarterly sales tax filings, prosecutors said. The agency also found quarters for which tax returns were never filed.
Investigators from the district attorney's office subsequently confirmed that the three companies and their responsible party were significantly underreporting gross sales.
Donnelly pleaded not guilty to the charges, said his Deer Park-based lawyer John Powers. Powers said his client has been cooperating with the district attorney's office during a two-year investigation.
"He's a local businessman with strong ties to the community and we're looking forward to discussing the matter with the government and coming to a resolution," said Donnelly. He declined to comment on the specific allegations.
Nassau's acting District Attorney Madeline Singas said in a statement: "Customers who pay sales tax to businesses should be sure that the money they are spending is going toward vital government services and not in the business owner's pocket. Businesses that don't remit sales tax money are stealing from the state, the county and their customers."