Two Coral Gables men were charged in federal court with scheming to obtain $9 million in kickbacks and other benefits and to hide their ill-gotten gains from the Internal Revenue Service while working as senior executives at Systemax Inc. and its TigerDirect Inc. unit.
Gilbert Fiorentino, 54, and his brother Carl Fiorentino, 57, were charged by separate criminal informations with conspiracy and tax offenses. They are expected to plead to the charges, as is typical in cases made by criminal information rather than by indictment.
Gilbert Fiorentino, a former director of Systemax, a Port washington, N.Y.-based computer and consumer electronics company, and former CEO of its technology product unit including TigerDirect, faces up to five years in prison if convicted of conspiracy to commit securities fraud and to impede the IRS.
Carl Fiorentino, former president of TigerDirect, was charged with conspiracy to commit mail and wire fraud and tax evasion, and faces up to 25 years if convicted.
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The government alleges the brothers schemed to obtain kickbacks for steering company business to certain contractors between 2002 and 2011. In one case, the brothers received more than $9 million in cash and other payments for steering more than $230 million in business to an Asian supplier of computer parts and accessories.
Court papers allege Carl Fiorentino received millions of dollars in payments from a TigerDirect supplier, including more than $3 million to pay for a waterfront home in Gables Estates. He also got millions of dollars in furnishings, art, and a security system, the government alleges.
According to court papers, Gilbert Fiorentino received hundreds of thousands in cash payments, including “bags of cash in the parking lot of TigerDirect’s offices in Miami.” In another instance, a vendor paid kickbacks with gold coins over several years to retain a marketing contract with TigerDirect, the government alleges.
The government also is pursuing forfeiture actions against the men.
Dan Gelber, an attorney for Gilbert Fiorentino, said “It’s been a journey for Gilbert. He has attempted to be fully cooperative with the government.” David Garvin, an attorney for Carl Fiorentino, couldn’t immediately be reached for comment.