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Former IRS agent sentenced to 18 months for helping orchestrate $29M tax-evasion scheme

Daniel Kornblatt leaves federal court in Central Islip

Daniel Kornblatt leaves federal court in Central Islip on Dec. 1, 2014. Credit: James Carbone

A former lawyer and Internal Revenue Service agent was sentenced to 18 months in prison Wednesday for helping orchestrate a $29 million tax-evasion scheme.

Daniel Kornblatt, 66, also was ordered to make restitution of $6.1 million and to serve 1 year of supervised release by U.S. District Judge Leonard Wexler at the federal court in Central Islip. The $6.1 million is the tax money owed.

Kornblatt pleaded guilty in December to a charge of preparing a false income-tax return in 2007 for Michael Gordon of Manhattan, the founder of Bumble and Bumble, a high-end Manhattan hair products business. Gordon's return did not report $29.6 million he received when he sold his company to the Estée Lauder cosmetics firm in Melville, according to court documents.

Gordon pleaded guilty to a similar charge in December and is awaiting sentencing.

Before he was sentenced, Kornblatt, who left the IRS in the mid-1980s and has given up his law license, said, "I acknowledge there was no one to blame but me. . . . I will forever be sorry for what I did. . . . But in my own action, I threw it all away."

Kornblatt was a revenue agent for the IRS from 1974 to 1984, according to court records.

After leaving, he set up a tax-consulting business in Manhattan.

Kornblatt's attorney, Ed Sapone of Manhattan, had asked for a sentence of probation and community service, saying his client had an otherwise spotless professional and government record, was abused as a child and was a drug addict at the time he worked for Gordon.

In imposing the sentence, Wexler said many people before him have had problems in life, but if he gave Kornblatt probation, the next troubled lawyer who appeared before him for sentencing would ask for probation unless his crime involved more than $29 million.

"I have to put you in jail. . . . You've been a disgrace to the bar association," Wexler said. The judge could have sentenced Kornblatt to up to 36 months in prison.

Afterward, Kornblatt declined to comment. Sapone said, "I commend Mr. Kornblatt for accepting responsibility for his actions and for turning his life around."

Eastern District Assistant U.S. Attorney Christopher Caffarone, declined to comment.

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