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Gerard Terry, ex-town Dem leader, pleads guilty to tax evasion

Former North Hempstead Democratic Party leader Gerard Terry

Former North Hempstead Democratic Party leader Gerard Terry arrives at federal court in Central Islip on Thursday, Oct. 12, 2017 where he pleaded guilty to federal income tax evasion. Credit: James Carbone

Gerard Terry — the one-time Democratic power broker from North Hempstead who held as many as six public jobs that paid him more than $200,000 a year — admitted in court Thursday he failed to pay nearly all his federal income taxes over an 18-year period.

In January, agents with the IRS Criminal Investigation Division and the FBI arrested Terry and charged him with one count each of tax evasion and obstructing the Internal Revenue Service.

Terry, 63, of Roslyn Heights, pleaded guilty Thursday in federal court in Central Islip to tax evasion. Prosecutors said he owes $1.4 million in taxes plus interest and will have to pay it back. As part of a plea deal, prosecutors dropped the obstruction charge.

Eastern District prosecutor Artie McConnell said in court papers that despite making more than $250,000 a year since 2000, Terry only paid $9,000 in federal taxes.

Before Terry entered his plea, formerly the counsel for numerous public county and town agencies in Nassau said he “knowingly and willfully” failed to pay taxes from 2000 to 2017. During this period, Terry said, “I consistently filed my taxes late or not all. . . . Substantially, most of my taxes were not paid.”

U.S. District Judge Joanna Seybert set sentencing for February. Seybert said Terry faces a fine of up to $100,000 and 3 years of supervised release after serving his prison term.

Under federal law, Terry faces up to 5 years in prison. Prosecutors said under sentencing guidelines, they estimated he would probably get between 30 and 36 months.

Terry “took the plea because he is guilty,” his attorney, Stephen Scaring of Garden City, said after the hearing. “There are a lot of mitigating factors that will result in leniency,” he said he believed.

Terry declined to comment after the hearing, as did McConnell.

Much of Terry’s income, according to officials and public records, came from his work as a lawyer for the Democratic commissioner at the Nassau County Board of Elections, the North Hempstead Board of Zoning Appeals, the Freeport Community Development Agency, the Roosevelt Library board, the Long Beach Housing Authority, and the villages of Port Washington and Manorhaven. Terry also served as counsel to the North Hempstead Town attorney.

At the time of Terry’s arrest, officials said he “routinely failed to file personal . . . tax returns.”

When questioned by the IRS, Terry filed forms years late that contained false information and failed to report income accurately, officials said in January.

Also, to prevent the IRS from seizing his assets, officials said, Terry cashed $500,000 worth of wages or compensation checks rather than depositing them in a bank; deposited only a minimum amount of cash in bank accounts to cover regular expenses and luxury purchases; and created and used a checking account in the name of a fictitious person.

Terry has said his failure to pay taxes stemmed from a “cascading series of serious” health problems.

Terry also has pleaded guilty to a separate state tax case.

In September, Terry pleaded guilty in Nassau County Criminal Court to failing to file a 2010 state tax return for personal income and to not paying more than $3,000 in state taxes.

The judge in that case said he expected to impose a sentence of up to 6 months in jail and 5 years of probation. The state sentence would probably run concurrently with any federal sentence, officials with the district attorney’s office said at the time.

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