South Florida

Escort service cheats IRS out of half million. Now the mastermind will do time

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After cheating the IRS out of half a million dollars, a Miami escort service owner was sentenced to two years in prison Friday, court documents show.

Dennis Zarudny — owner of Elite Miami Escorts and Elite Escort Service — had been charged with eight counts of tax fraud in 2017.

In April, he pleaded guilty to one count of making and subscribing a 2012 false tax return, and in return, prosecutors dropped the other seven counts, documents show.

Zarudny initially admitted to filing false corporate and personal income tax returns with the IRS in 2011, 2012, 2013 and 2014, “which substantially underreported his business income, “ courts records show.

“Zarudny allowed his customers to pay for the escorts’ services by cash, check, and credit card,” the U.S. Department of Justice said in a statement Friday. “Zarudny reported income from credit card transactions but did not fully report the income he received from customers who paid in cash and check.”

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Dennis Zarudny Miami-Dade Corrections

As a result, the IRS took a loss of $558,772, records show.

The escort agency’s website boasted a “prestigious escort agency providing 24-hour outcall escort services and adult entertainment for upscale gentlemen and couples in South Florida.”

In addition to jail time, Zarudny will serve one year of supervised release. A court hearing to determine restitution is scheduled for Dec. 7.