A New Jersey accountant has become the latest domino to fall in a sweeping $1.3 billion tax fraud scandal, pleading guilty to conspiring to defraud the United States through abusive conservation easement tax shelters, federal prosecutors announced Wednesday.
Ofer Gabbay, a certified public accountant and senior tax manager at The Green Group, admitted in court on Tuesday to promoting fraudulent syndicated conservation easement schemes to wealthy clients in 2018 and 2019, according to the U.S. Department of Justice.
His guilty plea adds fuel to the fire of a yearslong federal probe that has already resulted in decades-long sentences for two ringleaders—Georgia CPA Jack Fisher and attorney James Sinnott—who were convicted of orchestrating one of the largest conservation easement tax fraud schemes in U.S. history.
The $4-for-$1 Illusion: How the Scheme Worked
Syndicated conservation easement shelters allow landowners to take charitable deductions for donating easements that prevent land development. But prosecutors said Gabbay and others manipulated this legitimate concept into a money-printing tax dodge.
Led by Fisher, the scheme marketed a tantalizing pitch to deep-pocketed investors: $4 in tax deductions for every $1 contributed. Gabbay prepared backdated checks and falsified tax returns, helping clients reap millions in bogus deductions.
Fisher, the mastermind, recruited appraisers like Kate Joy (now a fugitive) to inflate land values by 30% to over 100%, boosting deduction sizes. Audio recordings at trial captured Fisher casually describing the inflation as industry standard. In truth, it was fraud.
Sinnott, who joined the plot in 2013, helped take the scheme to new heights. In their first year as a duo, the fraudulent deductions outpaced the prior decade combined, prosecutors said.
