New York City Councilman pleads guilty to tax fraud

NEW YORK CITY (WABC) -- New York City Councilman Chaim Deutsch pleaded guilty to tax fraud Thursday, admitting to claiming personal expenses as business expenses totaling $82,000.

Deutsch, who represents Brooklyn, filed the false and fraudulent income tax return to the IRS in 2016.

"New York City Council Member Chaim Deutsch admitted today that he defrauded the IRS in connection with his real estate business," U.S. Attorney Audrey Strauss said. "As an elected official and community leader, Deutsch had a particular responsibility to follow the law. Instead, over a multi-year period, Deutsch concealed his true business income to avoid paying his fair share of taxes. My Office will continue to work tirelessly with our law enforcement partners to hold our elected officials accountable when they break the law for their own financial benefit."

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City Council Speaker Corey Johnson called the plea "incredibly troubling news" and said he will be removed from all his committee assignments. But Johnson said Deutsch is not going to be automatically expelled.

"Our initial take is he is not automatically expelled under the charter," he said. "But I don't know how he himself would want to continue, given he is pleading guilty to a very serious federal crime."

Deutsch pleaded guilty to a single count of filing a false tax return for the tax year 2015 and agreed to restitution in the amount of at least $82,076 plus interest.

"Today, my client pled guilty to a one count misdemeanor tax offense of making false statements on a tax return," his attorney, Henry Mazurek, said. "He accepts responsibility for his actions and intends to fully repay the $82,000 in taxes he owes. Mr. Deutsch's dedication to public service will not be diminished, and he looks forward to completing his elected term."

Deutsch was released on $10,000 bond with travel restrictions ahead of sentencing in July.

He faces a maximum sentence of one year in prison, one year of supervised release, and a $100,000 fine.

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