Once wealthy Monsey man ordered to pay $1.3M to IRS

A former real estate magnate from Monsey has been ordered to pay the IRS nearly $1.3 million for cheating on his taxes.

U.S. District Judge Nelson S. Román ordered Joseph Neumann, 83, to pay $400 a month while he is under supervision for two years, in a restitution order approved on July 9, and then pay the balance at the end of the final month.

Neumann was arrested in November 2019 and charged with filing false tax returns for two years and then filing no tax returns for two years. From 2015 to 2018, according to the indictment, he underreported $3.6 million in income and saved himself about $1.25 in federal taxes.

He also was charged with conspiring to operate an unlicensed money transmitting business while trying to launder about $6 million for a 10% fee.

He pleaded guilty to all charges on Jan. 2.

Neumann was once a successful real estate investor. In the mid-1980s, his Broadway Management Co. Inc. owned and operated about 12 million square feet of New York City office space, according to a 2008 court record, and his personal interests were worth about $1.25 billion.

Broadway Management eventually became a global enterprise, with properties in Washington, D.C., Florida, Canada, Israel and Poland, according to a sentencing letter written by his attorneys, Robert J. Cleary and Lee Vartan. Then Neumann lost his wealth in the 2008 recession and housing market crash.

From 2013 to 2018, Neumann worked as a consultant for Greenbaum’s Pharmacy in Monsey, for which he was paid from $551,000 to $1.7 million a year, assistant prosecutors David A. Markewitz and James McMahon said in a sentencing memorandum.

Neumann’s attorneys said the criminal behavior began in 2014 and was “completely inconsistent with his character, history and values.”

Prosecutors and defense attorneys seldom agree on how long a defendant should be incarcerated. This time, the lawyers on both sides and the U.S. Probation Office recommended no prison time, despite sentencing guidelines that called for as much as 41 months in prison.

Neumann’s health has been declining rapidly.

“At this stage of his life and considering his very poor health,” his attorneys stated, “any term of imprisonment will effectively be a life sentence for Mr. Neumann.”

Prosecutors agreed that imprisonment would be inappropriate.

“But that does not mean that Neumann’s conduct is not serious,” their sentencing memo states. “Neumann’s crimes were incredibly serious. … Years long conduct in this case shows a lack of respect for the law and a willingness to engage in criminal behavior when doing so would benefit Neumann financially.”

On June 11, Judge Román sentenced Neumann to time served and two years of supervised release, including the first six months in home confinement with electronic monitoring.