Up to an Additional $6.7 Million to Follow
Deferred Prosecution Agreement, Sales Tax Payment Also Resolved Investigation into Affiliated Overseas Entities Sales Tax Practices
Manhattan District Attorney Cy Vance, Jr. today announced the resolution of an investigation into violations of the New York Tax Law and New York Penal Law by the New York auction house CHRISTIE’S, INC. (“Christie’s New York”) and affiliated overseas Christie’s entities including CHRISTIE’S MANSON & WOODS LIMITED (“Christie’s London”) and CHRISTIE’S PRIVATE SALES, LIMITED (“Christie’s Private Sales”) for failing to register to collect and to collect New York and local sales tax between 2013 to 2017.
“Thanks to our unique expertise and our prosecutors’ hard work, the Manhattan D.A.’s Office is again delivering millions of dollars in badly-needed revenue to the people of New York,” said District Attorney Vance. “Aggressive, proactive, white-collar investigations like this one have enabled us to send more than $2 billion to New York State since 2010, and have put multinational companies across the world on notice that the privilege of doing business in Manhattan comes with the obligation to comply with our tax, business, and criminal laws. I thank our prosecutors and investigators for their persistence in completing this meticulous investigation under the extraordinary circumstances of the COVID-19 public health emergency.”
New York State Commissioner of Taxation and Finance Michael Schmidt said: “This case sends a clear message: those who violate our tax law will be held accountable. The funds recovered today will do a lot of good in local communities. I thank District Attorney Vance and his team for their work on this case. We will continue to work with all our law enforcement partners to ensure a level playing field for taxpayers across the State.”
In the Deferred Prosecution Agreement, Christie’s London, Christie’s Private Sales and other affiliated Christie’s entities admitted to failing to register to collect and to collect New York and local sales tax between 2013 to 2017 on purchases made in and/or delivered to New York despite having a legal obligation to do so. In addition, Christie’s Private Sales also admitted that once certain employees finally determined in 2015 that the entity had an outstanding obligation to register to collect and to collect New York sales tax with the New York State Department of Taxation & Finance (“NYS Tax”), it failed to register the entity to collect tax with NYS Tax because of the perceived audit risk. Subsequently, Christie’s Private Sales began collecting sales tax from its customers without registering, and Christie’s New York, who were long registered to collect sales tax in New York, falsely reported and remitted this sales tax to NYS Tax as its own.
As part of the Deferred Prosecution Agreement, Christie’s London, Christie’s Private Sales and other affiliated Christie’s entities will pay up to $16.7 million in sales tax, penalties and interest over a two-year period, relating to sales made in and delivered to New York for which it failed to collect the required New York State & local sales tax between 2013 to 2017. The agreement takes into consideration the Christie’s entities prior and continued cooperation with the investigation, and numerous remedial measures instituted by the entities to come into compliance with their sales tax obligations. Christie’s will pay up to $16.7 million in sales tax, penalties, and interest to the D.A.’s Office, which the D.A.’s Office will forward in full to New York State.
Assistant D.A. Lisa M. White and former Assistant D.A. Emily Bradford handled the investigation and prosecution of the case under the supervision of Assistant D.A. Christopher R. Conroy, Chief of the Major Economic Crimes Bureau, Assistant D.A. Judith Salwen, Principal Deputy Chief of the Rackets Bureau, Assistant D.A. Jodie Kane, Chief of the Rackets Bureau, and Executive Assistant District Attorney Michael Sachs, Chief of the Investigation Division.
Rackets Investigator Stephanie Luk and Senior Rackets Investigator Behzad Ahdout assisted with the investigation under the supervision of Supervising Rackets Investigator Donato Siciliano, Assistant Chief Investigator Michael Wigdor, and Chief Investigator Walter Alexander of the Investigation Bureau. Paralegals Grant Raffel and Matthew Nelson, and former Investigative Analysts Victor Hollenberg and Quinn Cronan also assisted with the case.
District Attorney Vance thanked the City of London Police Department and DANY Supervising Rackets Investigator Matthew Winters who is embedded overseas with the Department for their assistance with the investigation.
District Attorney Vance also thanked the New York State Department of Taxation & Finance for their cooperation and assistance with the investigation.