Crime & Safety

Parsippany Owner, Workers Accused of Fraud, Tax Evasion

West Caldwell man, owner of three Parsippany businesses, surrendered to federal agents Wednesday morning.

A West Caldwell man who owns three Parsippany construction companies surrendered to federal agents Wednesday morning and appeared in court for tax evasion charges, U.S. Attorney Paul J. Fishman said.

Frank Chimento Jr., 67, was charged with not collecting and turning over federal and state payroll taxes, totaling more than $1 million, evaded personal income taxes on more than $1.4 million in income and falsified reports regarding union benefit fund contributions, Fishman’s office said.

Here’s what he was charged for and their maximum possible penalty per count:

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  • one count of conspiracy to defraud the U.S.— Five years in prison; $250,000 fine or twice the gross gain or loss from the offense
  • 2-15 counts for failure to collect and pay over payroll taxes—Five years in prison; $250,000 fine or twice the gross gain or loss from the offense
  • 16-19 counts of mail fraud—20 years in prison; $250,000 fine or twice the gross gain or loss from the offense
  • 20-29 counts of false statement in ERISA documents— Five years in prison; $250,000 fine or twice the gross gain or loss from the offense
  • 30-34 counts of individual income tax evasion— Five years in prison; $250,000 fine or twice the gross gain or loss from the offense

His three businesses, Chimento Construction, Chimento Construction Services and FAC Construction, specialized in commercial masonry and concrete work.

“Chimento Companies allegedly operated a cash payroll for a significant portion of the wages paid to employees during the period 2006 through 2011. To avoid currency transaction reports from being filed, a conspirator, who is not named in the complaints, executed cash transactions at several separate financial institutions to get cash to fund the payroll, allegedly at Chimento Jr.’s direction," according to Fishman’s office.

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The unnamed conspirator prepared envelopes with cash payroll based on the hours and wage rate information provided by Chimento Jr., the U.S. Attorney's Office said.

Chimento Jr. was responsible for collecting, accounting for and paying over to the IRS payroll taxes (withholdings from employees for Social Security, Medicare and income taxes).

The complaint also alleges that as early as August 2009, Chimento Companies have been involved in a collective bargaining agreement (CBA) with the International Union of Bricklayers and Allied Craftworkers, Administrative District Council of New Jersey, consisting of Local Unions 2, 4, and 5 (BAC/ADC), located in Bordentown.

CBA showed Chimento Companies must make specified contributions to various BAC benefits funds for each hour of covered work performed by employees of the Chimento Companies, the U.S. Attorney's Office said. However, according to the complaint, from Aug. 14 2009 through April 30, 2012, Chimento Jr. did not make required contributions and had false statements and representations to be made in remittance reports, the U.S. Attorney's Office said.

Three Employees

There were also three employees of Chimento’s construction companies who were arrested on charges including filing false income tax returns, bankruptcy fraud, and a mail fraud scheme to defraud the state of New Jersey with respect to unemployment compensation benefits.

All four defendants had their initial court appearance Wednesday afternoon before U.S. Magistrate Judge James B. Clark III in Newark federal court.

  • Joseph Carsillo, 45, of East Hanover, was the project superintendent for the Chimento Companies at Palmer Square.    
  • Frank Chimento III, 45, of Verona, worked for the Chimento Companies.
  • Carl J. Corso, 58, of Hamilton Township, worked for the Chimento Companies 

Carsillo started working for Chimento Companies in 2007 and according to the complaint, Carsillo conspired with Chimento Jr. to defraud the U.S. of payroll taxes and owing for the companies’ employees, Fishman's office said.

Carsillo was responsible for keeping track of employees’ hours and would furnish that information to the unnamed conspirator, which was used to determine the cash wages due to each employee, Fishman's office said.

According to the complaint, Chimento Companies gave Carsillo total cash wages of about $167,466 during the years 2009 through 2011, which he failed to include on his personal tax returns for those years.

Here’s what he was charged for and their maximum possible penalty per count:

  • One count of conspiracy to defraud the U.S.— Five years in prison; $250,000 fine or twice the gross gain or loss from the offense
  • 35-37 counts of filing false individual income tax returns— Three years in prison; $250,00 fine or twice the gross gain or loss from the offense
  • 38 counts of bankruptcy fraud— Five years in prison; $250,000 fine or twice the gross gain or loss from the offense

Chimento III worked for Chimento Companies for more than 10 years and was one of the employees who received cash wages, the U.S. Attorney's Office said. 

In 2007, Chimento III briefly had his own excavation business. An analysis of his bank accounts showed payments in 2007 from the Chimento Companies totaling $85,860, Fishman's office said. 

Chimento III filed with the IRS a 2007 Individual Income Tax Return that was not correct as it did not include the $45,860 he received for being by Chimento Companies, Fishman's office said.

He also allegedly did not file individual income tax returns on purpose from 2008 through 2011 although he received a Form 1099 for $100,000 in cash wages in 2008, and a total of $351,788 in cash wages during the years 2009 through 2011.

Here’s what he was charged for and their maximum possible penalty per count:

  • One count of filing false individual income tax return— Three years in prison; $250,000 fine or twice the gross gain or loss from the offense
  • 2-5 counts of willful failure to file an individual tax return— One year in prison; $100,000 fine

Corso started working for Chimento Companies on Aug. 12, 2009 and in addition to payroll checks, Corso asked for and got cash wages from Chimento Companies for employment from 2009 through 2011, according to the complaint.

Corso disclosed to his return preparer only the wages he got by payroll check and deliberately left out the cash payments from his personal tax returns despite knowing that the cash should have been included on these returns, Fishman's office said.

Corso is also charged with a scheme to defraud the NJ Department of Labor and Workforce Development for unemployment compensation benefits. On Nov. 1, 2009, Corso told the NJDOL-WD that he was no longer working and reactivated an earlier application for unemployment benefits and was given a weekly benefit of $526, Fishman's office said. He collected a total of $19,988 through the mail, according to the complaint.

Here’s what he was charged for and their maximum possible penalty per count:

  • One count of mail fraud—20 years in prison; $250,000 fine or twice the gross gain or loss from the offense
  • 2-9 counts of filing a false individual tax return— Three years in prison; $250,000 fine or twice the gross gain or loss from the offense


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