Charles Naselsky was convicted Monday on charges related to a tax evasion scheme that he carried on while he worked as a real estate lawyer at Cozen O’Connor — a scheme which also defrauded the firm — the U.S. Attorney’s Office announced.
He was convicted of two counts of tax evasion, two counts of filing false tax returns, three counts of wire fraud, and two counts of obstruction of justice.
Naselsky worked at Cozen O’Connor for four years before joining Blank Rome in July 2006. He left that firm around the time the Internal Revenue Service started investigating him, according to the indictment, to join Deeb Petrakis Blum & Murphy, where he was suspended after his indictment in 2010.
The IRS began investigating the matter in 2008 and a federal grand jury was empaneled in June of that year. The subject of the investigation was whether Naselsky properly reported all of his income on his 2005 and 2006 tax returns.
Naselsky, who is 52, “instructed some of his clients to pay him directly for professional services, despite knowing that the payments belonged entirely to the firm. He then hid that income from the IRS in order to avoid paying taxes on it and filed false income tax returns,” according to a statement released by the U.S. Attorney’s Office in Philadelphia. “When he became aware that he was being investigated by the IRS for tax offenses, he obstructed the investigation by fabricating evidence, including emails, that claimed the monies were loans from a company called U.S. Equity Investors LLC (USE),” according to the release.
He owes about $112,000 in taxes for failing to report $365,000 in income in 2005 and 2006, according to the release.
U.S. District Judge Paul Diamond of the Eastern District of Pennsylvania, who presided over the trial, will sentence Naselsky at a later date. According to advisory sentencing guidelines quoted in the release, he faces between 46 and 71 months in prison, restitution to the IRS, and the possibility of fines.
Thomas A. “Tad” Decker, CEO of Cozen O’Connor, declined to comment on the jury’s verdict.
Assistant U.S. Attorney Maria M. Carrillo and Tiwana L. Wright of the Department of Justice’s Tax Division prosecuted the case.
Robert E. Welsh Jr. of Welsh & Recker in Philadelphia, who represented Naselsky, couldn’t immediately be reached for comment.