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Joon H. Kim, the acting United States Attorney for the Southern District of New York, announced Tuesday that 53-year-old Rockwell Gajwani pleaded guilty to one count of wire fraud and three counts of tax evasion. As part of his plea, Gajwani agreed to pay $1,975,068.04 in restitution and $1,612,841 in forfeiture.
According to court documents, from October 2011 to March 2013, Gajwani was the CEO and president of the company. During that time he took more than $1.6 million in company funds by making wire transfers to his personal bank account, writing company checks to himself, and making cash withdrawals from the company's bank account, according to Kim.
Kim said that in order to accomplish his scheme, Gajwani took steps to conceal his true salary and to conceal from the company's parent company the amount of money he had taken. He evaded requests for financial information from the company's director of accounting as well as from the parent company. He also had his employees lump compensation of all employees together in accounting material to hide his salary information, and directed some employees not to communicate with the parent company.
Over the course of his employment, he wrote himself over $940,000 in checks from the company bank account, and wired more than $1.7 million to his personal bank account. While some of these funds were for expenses, in the end he had taken more than $1.6 million more from the company bank account than he was entitled to.
In addition to defrauding the real estate company, he also did not file tax returns or pay taxes for his legitimate salary, or for the money he secured through fraud. When he learned of the criminal investigation in July 2015, he filed tax returns for the 2011, 2012, and 2013 calendar years. In each case, he underreported his salary by hundreds of thousands of dollars.
“As he admitted today, for years Rockwell Gajwani siphoned money from his employer’s accounts, lining his own pockets with more than $1.6 million," said Kim. "Instead of working diligently as his company’s CEO, Gajwani put his efforts into concealing his crimes and hiding his ill-gotten gains from the IRS. Thanks to the dedicated work of the Postal Inspection Service and the IRS, Gajwani will now be held to account for his crimes.”
Gajwani is scheduled to be sentenced on Sept. 12. The wire fraud conviction carries a maximum sentence of 20 years in prison, while the three counts of tax evasion each carry a maximum sentence of five years in prison.
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