Lorraine Pilitz, Merrick business owner, sentenced to 33 months for IRS evasion

The Merrick owner of several Long Island-based auto-related businesses was sentenced Friday to nearly three years in prison for concealing hundreds of thousands of dollars in income from the IRS while diverting some of the money to her family's personal bank accounts.

In federal court in Central Islip Friday, Lorraine Pilitz, 65, was sentenced by U.S. District Judge Joanna Seybert to 33 months in prison, ordered to pay $324,702.78 in restitution to the IRS while also forfeiting a commercial property in Lindenhurst, authorities said.

In November of 2022, Pilitz was found guilty by a jury after a two-week trial of illegally structuring financial transactions, corruptly obstructing the IRS and filing false tax returns.

“For years Pilitz thought she could get away with hiding substantial amounts of cash and income, impeding the Internal Revenue Service, and cheating her employees, until a jury found her guilty on all counts,” said Breon Peace, U.S. Attorney for the Eastern District of New York. “Today’s sentence sends a message to the defendant and others who place greed above following the law that this Office will vigorously prosecute those who commit tax fraud.”

Richard Langone, Pilitz's Garden City-based defense attorney, called the sentence “harsh and unjustified. We are appealing the verdict and the sentence.”

Pilitz, also known as “Lorraine Christie” and “Lorraine Storms,” operated several locally-based automobile-related businesses, including in Malverne and Rockville Centre, prosecutors said.

Between 2011 and 2013, Pilitz routinely structured cash bank deposits at just under $10,000 to avoid filing required Currency Transaction Reports with the IRS — mandatory for each transaction in excess of $10,000, prosecutors said. In total, Pilitz concealed hundreds of thousands of dollars from the IRS, officials said.

As part of the same scheme, Pilitz diverted hundreds of thousands of dollars in business checks into personal and family bank accounts; maintained “off-the-books” payrolls, failed to file personal and corporate tax returns and filed false tax returns that severely underreported her income, authorities said.

“Lorraine Pilitz lined her pockets with money owed to the government by hiding hundreds of thousands of dollars and grossly underreporting her income with an ‘off-the-books’ payroll,” said Thomas Fattorusso, acting special agent-in-charge of the IRS Criminal Investigation division in New York. “ … Today’s sentencing means she now faces the consequences of her self-serving criminal acts.”

By Robert Brodsky

robert.brodsky@newsday.com@BrodskyRobert

Robert Brodsky is a breaking news reporter who has worked at Newsday since 2011. He is a Queens College and American University alum.