Long Island contractor sentenced to two years for payroll scheme


Date: December 7, 2021

Contact: newsroom@ci.irs.gov

NEW YORK — The owner/operator of a Glendale-based construction company was sentenced to 24 months in federal prison and ordered to pay $250,000 in restitution to the federal government Thursday for not paying payroll taxes. He will remain on supervised release for 36 months following his prison term. The sentence resulted from an investigation by IRS Criminal Investigation's (IRS-CI) New York office.

From January 2010 to December 2013, Rafal Ziolkowski used $6.6 million in Oliwa Construction business receipt checks to fund an unreported cash payroll, causing a loss to the federal government of $656,142. During the course of the investigation, Ziolkowski repeatedly lied to investigators from IRS-CI, claiming he had never visited a commercial check cashing business. Investigators, however, determined Ziolkowski established accounts at two check cashing businesses under his construction company's name and authorized others to cash business receipt checks there.

"When you're making money, you must contribute your fair share to taxes," said Thomas Fattorusso, special agent in charge of the IRS-CI New York Field Office. "The scheme that Ziolkowski initiated prevented more than $650,000 in taxes from funding programs like Social Security and Medicare – programs created for our country's workers."

Rafal Ziolkowski pleaded guilty to failing to collect and pay payroll taxes in June 2019.

IRS-CI is the criminal investigative arm of the IRS, responsible for conducting financial crime investigations, including tax fraud, narcotics trafficking, money-laundering, public corruption, healthcare fraud, identity theft and more. IRS-CI special agents are the only federal law enforcement agents with investigative jurisdiction over violations of the Internal Revenue Code, boasting a nearly 90 percent federal conviction rate. The agency has 20 field offices located across the U.S. and 11 attachés stationed abroad.