By Charisma L. Miller, Esq.
Brooklyn Daily Eagle
A Brooklyn business owner has pleaded guilty to tax fraud and faces up to 10 years behind bars. In two agreements with separate law enforcement agencies, Jason Stevens, owner of reBar, agreed to pay restitution to the state, city, and jilted couples that planned weddings at the Brooklyn venue. Stevens, who has made claims of poverty in the past, may not be able to repay restitution in excess of $6 million, leaving many wondering if they will ever be made financially whole.
Stevens provided many of Brooklyn’s betrothed with a shock when he unexpectedly shut down the noted wedding venue in DUMBO last month with a simple note that the business had gone bankrupt. Stevens disappeared with thousands of dollars in wedding deposits only to surface few weeks later with a criminal indictment hanging over his head.
The Brooklyn District Attorney’s office filed charges of tax fraud against Stevens, who, the indictment read, failed to pay taxes from 2009-2012. In a plea deal with the DA’s office, Stevens plead guilty on June 12, and agreed to repay over $6 million in principal, interest and penalties on his tax liability. In addition to the tax liability, Stevens will serve between three and 10 years behind bars.
As the DA’s deal only dealt with criminal tax liability, the New York State Attorney General’s office reached out directly to reBar couples in an attempt to redress the financial nightmare brought on by Stevens’ actions. Attorney General Eric Schneiderman announced that his office has reached a tentative agreement for Stevens to also pay restitution to couples who paid for a wedding venue that they were ultimately denied.
Facing double restitution—repayment of tax debt and repayment to wedding couples—the question is raised as to Stevens’ actual ability to make these payments and the consequences in the event of his default.
“Restitution is different from a fine or surcharge,” advised Brooklyn attorney Wilson LaFaurie. “With a fine or surcharge, you can waive it if you are indigent. You cannot waive restitution.”
In most cases involving restitution, it is generally an alternative to prison, or—as in Stevens’ case—a reduction to a prison sentence. “Restitution is used as a prosecutorial tool to make the victim whole and take jail off the table where appropriate,” noted LaFaurie, a former prosecutor. However, a stint behind bars will not absolve a restitution requirement.
If restitution agreements cannot be fulfilled while in prison, it will remain a condition of parole. “The duty to restore the victim, whether the state or an individual, will always remain,” LaFaurie explained. “And if [Stevens’] failed to adhere to the restitution agreement, [he] would have breached a deal and may likely find himself back in jail.”
Whatever income Stevens earns upon his release from prison at least ten percent will go towards restitution payments.
Restitution to for taxes and through the Attorney General’s office are not the only payments that Stevens may face upon his release from prison. A number of couples have filed civil suits alleging breach of contract, fraud, and fraud in the inducement.
“We are most definitely going forward with our suit,” said Victor Dunlop, attorney for Nancy Neinberg, in an exclusive Brooklyn Daily Eagle interview. Due to Stevens’ present criminal predicament, Neinberg is only seeking the value of her contract $33,000. “If the court does find that there was fraudulent inducement, there may be more penalties added,” Dunlop noted.
Dunlop and his client did not seem phased at Stevens’ claim of poverty or the pending restitution payments that would have to be satisfied before any civil judgments are fully addressed. “This is not a symbolic filing and we hope to get some kind of relief,” said Dunlop. “We don’t know if Stevens owns any property out of state or holds any trusts. He had to have done something with the money he took from reBar couples. If we get a judgment against [Stevens] we can sue him to recover the judgment.”
Stevens will return to court in July to receive his final sentence.