The defendants, who have already paid $160,000 in restitution to...

The defendants, who have already paid $160,000 in restitution to the state Taxation and Finance Department, still owe an additional $750,000 in restitution and other fees, according to state Attorney General Letitia James' office. Credit: Howard Schnapp

Two Freeport-based towing companies and their owner pleaded guilty Friday to underreporting more than $8 million in taxable sales over the past decade, state officials said.

Broadway Towing and Broadway Auto & Towing pleaded guilty to one count each of third-degree criminal tax fraud while business owner Luis Crespo, 53, of Freeport, pleaded guilty to petit larceny.

Nassau District Court Judge Terence Murphy sentenced Crespo to a three-year conditional discharge.

The defendants, who have already paid $160,000 in restitution to the state Taxation and Finance Department, still owe an additional $750,000 in restitution and other fees, according to state Attorney General Letitia James' office.

"There’s no award presented to those who partake in tax evasion, but Broadway Towing’s performance has ensured the company finally pays New York State more than $900,000 in restitution, interest, and penalties," James said. "Today’s convictions should serve as a clear reminder that we will never tolerate those who seek to defraud our state out of its owed tax revenue, especially as we continue to face budget shortfalls. The lights have finally dimmed on Broadway Towing’s fraud."

James Druker, Crespo's defense attorney, said his client admitted his guilt and had agreed to pay his liability.

"I just hope the state allows him to stay in business to comply with his obligations to repay his debt," Druker said.

Crespo underreported more than $8 million in taxable sales, and failed to remit more than $700,000 in sales tax collected from his two auto body repair shops between 2009 and 2018, according to an investigation by the attorney general’s Auto Insurance Fraud Unit and the Department of Taxation and Finance’s Criminal Investigations Division.

Broadway Towing underreported its taxable sales by $5.4 million and failed to remit more than $467,000 in sales tax to the state between Dec. 1, 2009, and Feb. 28, 2018, according to a tax department audit.

Broadway Auto & Towing underreported its taxable sales by $3.1 million, and failed to remit nearly $272,000 in sales taxes between late 2009 and Nov. 30, 2016.

"Business owners who tilt the playing field for their own personal gain not only violate the trust of their community, they rob it of critical funding for public programs and services," said Michael Schmidt, commissioner of the Taxation and Finance Department. "This is hundreds of thousands of dollars that would have helped improve lives in local neighborhoods, but instead they were siphoned off for personal profit."

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