TRENTON — Attorney General Matthew J. Platkin today announced that the operator of a restaurant in Union County, New Jersey, is facing up to three years in state prison for failing to remit nearly $500,000 in New Jersey sales taxes he collected over a period of almost seven years.

John Garofalo Sr., 75, of Union Township, operator of Mario’s Tutto Bene restaurant on Chestnut Street in the township, pleaded guilty on Monday, June 19, 2023, in connection with a multi-year underreporting tax scheme, admitting to one count of second-degree theft by failure to make required disposition of property. Garofalo Sr. entered the guilty plea before Superior Court Judge Sherry L. Wilson in Mercer County. At the time of his plea, Garofalo Sr. paid in full to the Division of Taxation the entire $496,374.99 in sales tax that he collected but failed to pay to the State.

Under the terms of the plea agreement the State will recommend a three-year prison term for Garofalo Sr. at sentencing, scheduled for September 28, 2023 before Judge Wilson.

In pleading guilty today, Garofalo Sr. admitted that while operating the restaurant from July 2015 through March 2022, he reported only 40% of the sales tax collected from patrons of the restaurant. The Division of Taxation requires restaurants to impose a 6.625% sales tax on food and drinks they sell and requires 100% of that tax to be remitted to the State.

“John Garofalo Sr. illegally pocketed hundreds of thousands of dollars in tax revenues that belonged to the State, money that is used to fund infrastructure improvements, education, public assistance, and other programs and services that benefit the residents of New Jersey,” said Attorney General Platkin. “We will not allow defendants to enrich themselves at the expense of honest taxpayers who rely on the services and benefits funded by their tax dollars.”

“Restaurant operators cannot increase patrons’ restaurant bills under the guise of collecting sales tax and then keep for themselves what they ostensibly collected on behalf of the State,” said Pablo Quiñones, Legal Chief of the Office of Securities Fraud and Financial Crimes Prosecutions. “The willful withholding of sales tax is stealing, plain and simple. As this case demonstrates, the Office of Securities Fraud and Financial Crimes Prosecutions will hold accountable those who deliberately skirt the State’s sales tax requirements.”

Garofalo was charged by accusation on Monday, June 19, 2023, following an investigation by the NJ Division of Taxation, Office of Criminal Investigation, in collaboration with detectives from the Division of Criminal Justice and the Office of Securities Fraud and Financial Crimes Prosecutions (OSFFCP).

This case is being handled by OSFFCP Deputy Attorney General Derek Miller, under the supervision of OSFFCP Deputy Bureau Chief Alyssa Bloom and OSFFCP Legal Chief Pablo Quiñones.

Defense attorney: Jerome Ballarotto, Esq.