FOR IMMEDIATE RELEASE NOVEMBER 4, 1994 NEW YORK MAN PLEADS GUILTY IN TAX CASE

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WASHINGTON, D.C. - A former wholesale gasoline sales manager from New Rochelle, New York, pleaded guilty in U. S. District Court in Hauppauge, New York, for his role in a conspiracy to evade more than $85 million in federal gasoline excise taxes, the Department of Justice announced today. John Barberio, 68, the former manager for New York Fuel Terminal Corp., was the last of seven defendants to plead guilty to the tax evasion scheme. An eighth defendant, Viktor Batuner, is a fugitive. Barberio's plea follows the October 27, 1994, guilty pleas of former terminal operators Joseph A. Macchia, Lattingtown, N.Y., and his three sons, Lawrence, George and Joseph L., for their role in the tax fraud scheme from 1983 through 1988. Joseph A. Macchia and two of his sons, Lawrence and George, also pleaded guilty to two counts of excise tax evasion. Michael Varzar pleaded guilty on May 24 of this year for his role in the conspiracy and to two counts of gasoline excise tax evasion. New York Fuel Terminal Corp. was registered with the Internal Revenue Service and was required to pay a tax on each gallon of gasoline it sold to an unregistered company. The Macchias, through New York Fuel, sold almost 1 billion gallons of gasoline to unregistered companies without paying the tax they owed. On October 13, Marat Balagula, pleaded guilty to five counts of the indictment charging him with conspiracy and excise tax evasion. Balagula, who controlled many of the unregistered companies to which New York Fuel sold gasoline, is currently serving a 10-year sentence following his 1992 prosecution by the Tax Division for his involvement in a separate gasoline excise tax evasion scheme for which Barberio also was convicted. Barberio was sentenced to three years' imprisonment. Evidence presented at Balagula's 1992 sentencing in the earlier case implicated him as a member of a Russian organized crime group headed by Evsei Agron. According to testimony at the hearing, on the day following Agron's gangland-style murder, Balagula moved into Agron's office and took over operation of the organization. The sentencing court ruled that the probation department properly concluded that Balagula "was a member of an organization of criminals made up of Russians and other Eastern European immigrants based in Brooklyn." All of the defendants will be sentenced by Judge Leonard D. Wexler at a later date. Each faces a maximum of five years in prison and a $250,000 fine for each count. Assistant Attorney General Loretta Argrett of the Tax Division said, "The Tax Division has a strong commitment to prosecute the criminal elements who would deprive the nation's treasury of millions of dollars in tax revenue. This is only another step in our ongoing efforts to eliminate motor fuels tax fraud and to prosecute those criminals, organized or otherwise, who would defraud the United States." ### 94-644