Businessman Sentenced For Stealing Withholding Taxes

PLEASANTVILLE, NY — The owner of a Pleasantville-based payroll processing firm was sentenced to prison after pleading guilty to stealing withholding tax money from state and federal authorities that he collected from his clients.

Westchester County District Attorney Anthony A. Scarpino Jr. said Wednesday that Stefan Malgarinos, 49, was sentenced as follows:

• Second-degree grand larceny, a felony: 2 to 6 years in state prison
• First-degree scheme to defraud, a felony: 1 to 3 years in state prison.

The terms will run concurrently. Malgarinos pleaded guilty to the two charges in February.

In addition to the prison terms, the court also signed orders of restitution for the following victims in the amounts listed:

• Mid-Bronx Haulage: $108,880.00
• Blueline Tactical Supply: $87,732.84
• Barrier Contracting LLC: $71,680.00
• South of the Border: $17,204.00
• The Sinon Group LLC: $2,000.00

Malgarinos, owner of Manos Business Management, a payroll processing firm in Pleasantville, was hired by businesses to file withholding tax returns, to pay the withholding taxes collected from employees and to remit unemployment insurance premiums to state and federal tax and labor authorities.

In that role, police said, the defendant collected payments from client businesses and was responsible for sending those payments on behalf of his clients to state and federal authorities.

From Oct. 1, 2012, to Dec. 16, 2015, Malgarinos collected the full amount due to tax authorities from his clients. However, he failed to remit the entire collected amount to authorities and used the funds for his personal use without the knowledge or permission of his clients.

Specifically, in his plea, Malgarinos admitted to the following: In 2015, he received in excess of $107,000 from Blueline Tactical Supply and Shooting Sports in Elmsford to pay the company's tax obligations. He remitted only partial payment of $17,690.48 to authorities and used approximately $87,732.84 without permission. He also admitted to defrauding the four other businesses.