In order to conceal his tax evasion, Herman bought money orders at area U.S. Post Offices, or he gave the skimmed cash to his household employees and directed them to buy money orders for him, authorities said. Typically, the money orders were purchased four at a time in amounts of exactly $700 in order to avoid the requirement that financial institutions report purchases of money orders in denominations of more than $3,000.

Herman has agreed to pay $375,000 in back taxes, plus penalties and interest, and to forfeit $236,000, which was the amount of money orders purchased in the structured transactions.

Herman also admitted that from January 2000 through September 2003, he billed Oxford Health Plans for elective cosmetic surgery, but submitted the bills stating that the procedures were medically necessary biopsies and other procedures. Herman has agreed to pay approximately $150,000 in restitution to Oxford.

"This is a classic case where runaway greed tempts an individual into perpetrating several simultaneous illegal fraud schemes," said U.S. Attorney Kevin O'Connor. "The message here is simple: If you cheat on your taxes, you run the very real risk of getting caught. That means a felony conviction, jail, and payment of back taxes, penalties and interest."

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