Saratoga County Grand Jury Indicts Two Nyra Employees

Attorney General Spitzer, State Police Superintendent James McMahon and State Inspector General Jill Konviser-Levine announced the indictment of two employees of the New York Racing Association (NYRA) for their role in a tax-evasion and identity theft scheme.

The two employees, who worked as betting clerks at the Saratoga, Belmont and Aqueduct tracks, are accused of helping certain bettors who won large wagers avoid taxes on their winnings.

"This elaborate scheme violated tax laws, victimized innocent individuals and undercut the integrity of the tracks," Spitzer said. "By working closely with the State Police and the State Inspector General, my office is putting an end to this illegal activity."

State Police Superintendent James W. McMahon said: "The individuals arrested in this scheme not only helped bettors cheat the taxpaying public by evading taxes due on winnings, but caused a great deal of personal and financial distress to the innocent people whose identities were stolen to accomplish this scheme. I commend the investigators and prosecutors who diligently uncovered this long standing illicit activity."

State Inspector General Jill Konviser-Levine said: "Race track employees who engage in illegal or other improper activities violate the public’s trust in them. This case should send a clear message that such conduct will not be tolerated."

The 132-count indictment by a Saratoga County Grand Jury charges two Queens residents, James Boggiano, 58, and John Wiesener, 41, with multiple counts of forgery and related charges. The charges are class "D" felonies. The maximum penalty for a class "D" felony is seven years in state prison.

State Police Investigators arrested Boggiano, on May 8, 2003 in Queens, and Wiesener in Westchester County on May 12, 2003. They were arraigned in Saratoga County Court before Judge Jerry Scarano. Bail was set at $75,000 for each defendant.

Investigators believe that the scheme worked in this way: a customer with a winning ticket requiring filing of IRS form W2-G would reach an agreement with betting clerks responsible for filing of the forms. This agreement resulted in the filing of a forged form by the betting clerks who used the names and social security numbers of others without their knowledge or permission. The investigators were informed that this scheme was known at the track as "ten percenting" as 10 percent is the normal fee charged by the clerks for entering into this agreement.

The indictment does not focus directly on this aspect of the scheme, however. Instead, prosecutors target the forgery by the clerks. Among the charges against the two clerks is possession of forged documents.

Investigators are unsure of how long the scheme was operating, but the indictment identifies some $83,000 in winnings that were the subject of forged IRS documents.

Investigators have also identified at least five ID theft victims. The common link between the victims is that they were all involved in the horse racing industry at one time or another. These victims discovered the identify theft when the IRS sought payment of taxes on race track winnings.

The charges in the indictment are merely accusations and the defendants are presumed innocent until and unless proven guilty.

The evidence in this case was developed by the Attorney General’s office , the Special Investigations Unit of the State Police, and the Inspector General’s Office. The investigation is ongoing and investigators are seeking to identify additional victims.

Assistant Deputy Attorney General Meryl Lutsky supervised the investigation and will handle the case for trial. State Police Investigators Paul L. Borella, and Mike DiSilvio, and Deputy Inspector General Ann Palillo of the Inspector General’s Office conducted the investigation.