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ALBANY---A jury in the Northern District of New York has found the owners of the chain USA Gas stations and convenience stores guilty of federal tax violations and obstructing and impeding the Internal Revenue Service.
Ziya Ozbay, 59, of Schenectady and his son-in-law, Yalcin Ozbay, 38, of Saratoga Springs, were also found guilty of failing to pay employee withholding taxes, failing to file income tax returns and structuring cash deposits to avoid the reporting of the transactions to the IRS.
Two other defendants, Mustafa Ozbay, 56, of Schenectady and Birol Ozbay, 29, of Schenectady, pleaded guilty to these charges on Nov. 2, during the trial.
The defendants were found guilty of obstructing and impeding the IRS by preventing the IRS from accurately calculating the taxes due from them personally and from their corporations.
Specifically, the indictment alleged that the defendants failed to maintain corporate books and records accurately reflecting corporate revenues and expenses for several corporations; did not provide their accountant with adequate books and records to prepare income tax returns for several of their corporations; failed to keep their corporate operations separate and distinct; failed to file and filed inaccurate corporate and personal tax returns; failed to pay federal withholding taxes and Federal Insurance Contribution Act taxes for some USA Gas employees; and hid the total amount of their cash deposits from the IRS by making cash deposits of less than $10,000 to avoid having the cash deposits to the IRS.
The defendants were also found guilty of several charges involving the operation of the USA Gas station at 1605 Broadway in Schenectady. Specifically, Ziya Ozbay was found guilty of five counts of failing to file income tax returns for Ozbay Service Center Inc., the corporation which owns that USA Gas station, for tax years 1999, 2000, 2001, 2002, and 2003, and six counts of failing to pay employee withholding taxes for USA Gas employees for quarters ending from 1999 through 2003.
Yalcin Ozbay was found guilty of one count of failing to pay employee withholding taxes for USA Gas employees at 1605 Broadway, Schenectady for the quarter ending Dec. 31, 1999.
The jury also found defendants guilty of three counts of structuring, that is making cash deposits less than $10,000 to evade federal reporting requirements for cash deposits more than $10,000. The total amount structured by all of the USA Gas stations was approximately $21 million.
In addition, Yalcin Ozbay was found guilty of 19 counts of failing to pay employee withholding taxes for USA Gas employees working for two of his corporations. He was also found guilty of subscribing to a false return for not reporting more than $400,000 of revenue earned by one of his corporation during tax year 2002 which also affected his 2002 personal tax return because the calculations from the corporate return were carried over to his personal return.
Yalcin and Ziya Ozbay were ordered held in jail pending detention. Sentencing will be in March.
It is expected that the government will initiate asset forfeiture proceedings. Yalcin Ozbay was involved in the operation of USA Gas Stations in South Glens Falls, Ballston Spa and Clifton Park. The Queensbury USA Gas Station is reportedly not involved in any of the actions. 11-06-06
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© 2006 North
Country Gazette
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