Moshe Gabay, a Baltimore pharmacy owner, has entered a guilty plea to one count of filing false tax returns with the Internal Revenue Service (IRS). The plea deal reveals that Gabay, 54, underreported his income by over $3.5 million, leading to a tax loss of more than $1 million.
The announcement of Gabay's plea was made by Kelly O. Hayes, U.S. Attorney for the District of Maryland, in conjunction with Special Agent in Charge Kareem Carter of the Internal Revenue Service – Criminal Investigation for the Washington D.C. Field Office.
Gabay admitted to owning and operating SINU-RX Pharmacy Inc. in Baltimore and acknowledged controlling the pharmacy's finances. This control included directing interactions and providing information to the company’s bookkeepers and tax preparers.
In tax filings from 2017 to 2022, Gabay included Form 1120S, pertaining to the S Corporation, for SINU-RX, and Form 1040 for his individual income. His plea details how Gabay knowingly misrepresented funds from SINU-RX as business expenses, specifically for the costs of goods sold, while diverting them for personal use. As part of the plea agreement, he has agreed to restitution exceeding $1 million.
Gabay is facing a potential maximum sentence of three years in federal prison for the offense. However, federal crime sentences are often below the maximum penalty, and a federal district court judge will determine the final sentence after reviewing U.S. Sentencing Guidelines and other statutory elements.
U.S. Attorney Hayes expressed gratitude for the investigative work by the IRS-CI and acknowledged Special Assistant U.S. Attorney Jared W. Murphy alongside Assistant U.S. Attorney Matthew P. Phelps for prosecuting the case.
Further information about the Maryland U.S. Attorney’s Office, its priorities, and available community resources can be accessed via their official website.