Former North Hempstead Town Democratic chairman Gerard Terry was sentenced Tuesday to 3 years in prison after he admitted failing to pay nearly $1 million in federal income taxes.
U.S. District Court Judge Joanna Seybert in Central Islip also imposed 3 years of supervised release after Terry’s prison sentence in which he must report to a federal probation officer.
“This wasn’t a person who was facing devastating poverty. This was a person who despite the charitable actions was greedy,” Seybert said, referring to Terry’s pro bono community work.
Terry, 64, of Roslyn Heights, pleaded guilty on Oct. 12, 2017, to one count of tax evasion. In exchange for his plea, prosecutors dropped an obstruction charge against him.
He apologized Tuesday and acknowledged he broke the law, saying, “I am deeply regretful, embarrassed and ashamed. . . . I take full responsibility for my actions.” He added: “I will do my very best to square things up with the IRS.”
Seybert also ordered Terry to pay $992,057 in restitution and said $31,000 will be forfeited by the government. The Internal Revenue Service likely will pursue the total of nearly $1.4 million he owes, including penalties and interest, prosecutors said.
In court, Artie McConnell, an assistant U.S. attorney who prosecuted the case, said Terry used his income to buy “luxury clothes” and “high-end electronics,” pay for trips overseas and finance shopping sprees in Manhattan, while failing to pay income taxes.
“This was not a mistake. This happened over a period of 15 years,” McConnell said. “It really is staggering.”
Federal prosecutors said Terry intentionally avoided paying taxes from 2000 to 2015 by engaging in sophisticated schemes that included enlisting others — including government workers, a law firm and a business — to help him.
A substantial punishment, prosecutors said, would discourage others in positions of power from breaking the law.
Federal prosecutors had asked the judge to sentence Terry to 4 1⁄2 years in prison.
Terry’s attorney, Stephen Scaring of Garden City, had asked the judge to sentence his client to community service and no jail time, citing Terry’s charitable work.
“I think it’s a little harsh,” Scaring said of the sentencing outside the courtroom.
Earlier, in court, he said “it could make such a difference to so many people” if Terry were sentenced to community service.
Richard Donoghue, U.S. attorney for the Eastern District, reiterated that everyone must pay their fair share of taxes. “Gerard Terry lived by a different standard than the taxpayers he served, taking money from them in payment for the numerous governmental and quasi-governmental jobs he held, while failing to pay the taxes he owed on those jobs,” Donoghue said in a written statement.
Terry also is awaiting sentencing in a separate state tax fraud case. He was jailed by a Nassau judge while he awaited his federal sentencing, and on Tuesday he was returned to the Nassau County Correctional Facility in East Meadow.
More than 100 people submitted letters to the judge, asking for leniency in Terry’s sentencing because of his extensive pro bono community work including with minorities, according to Scaring. They included Hazel Dukes, president of the NAACP in New York, and Rep. Thomas Suozzi (D-Glen Cove), Scaring said.
The judge commented that the package of letters was “one of the most impressive submissions I’ve ever seen.”
But McConnell said many were from political allies of Terry and simply showed that “the political class on Long Island takes care of itself.”
During the 15 years that prosecutors said Terry failed to pay almost all of his federal income taxes, he earned about $250,000 annually working for various public entities, including the Nassau County Board of Elections, Long Beach Housing Authority, Hempstead Housing Authority, Freeport Community Development Agency, Roosevelt Library, Village of Port Washington North, Village of Manorhaven and the Community Development Corporation of Long Island.
Terry used numerous schemes to hide his incomes from the IRS and went to great lengths to avoid paying his share of the federal income taxes, according to prosecutors.
In one instance, they said, Terry opened a bank account in the name of Neville Warwick LLC to purposely conceal the income.
Between September 2010 and November 2014, about $16,000 in total deposits were made to the account, and prosecutors said the money was used to pay Terry’s personal expenses, including payments to BMW and AT&T.