US Attorney’s Office Indicts Morris Zukerman on Art Tax Evasion Amid Ongoing Crackdown

Over $4.5 million of art went straight to his Manhattan residence.

Morris Zukerman at Harvard in 2007. © Harvard Magazine, courtesy Flickr.

As authorities in Manhattan continue to crack down on tax evasion including art related activity, Preet Bharara, the US Attorney for the  Southern District of New York, announced a three-count indictment against investor and former Morgan Stanley executive Morris Zukerman, 71, for evading over $45 million in income and other taxes.

The charges include tax evasion on the purchase of several Old Master paintings. According to the indictment:

In connection with the purchase of the Old Master paintings, Zukerman schemed to defraud New York State of over $4.5 million of sales and use taxes by directing that the paintings, which were frequently purchased from galleries located blocks from Zukerman’s Manhattan residence, be shipped by the galleries to Zukerman’s corporate addresses located in Delaware and New Jersey, and transported immediately thereafter (sometimes within minutes), by Zukerman and others, back to Zukerman’s residence in New York—all without the payment to New York State of sales or use taxes.

Further detail in the Grand Jury charges says he also purchased paintings from galleries and auction houses in Europe and purportedly shipped them to addresses in Delaware and New Jersey but then shipped them to his “duplex cooperative apartment on Manhattan’s Upper East Side.”

The indictment charges that between 2008 and 2013, Zukerman directed that over $50 million of funds transferred to one of his investment companies be used to purchase paintings by European artists from the 15th through 19th centuries, but it doesn’t specify names or titles of works. artnet News reached out to the Justice department to inquire about the works and the name or names of the galleries Zukerman purchased works from but had not heard back by publication time.

A painting on the now-password-protected M.E. Zukerman & Co. website.

A painting on the now-password-protected M.E. Zukerman & Co. website.

The indictment also said Zukerman further schemed to defraud New York state of sales and use taxes by using his corporate address in New Jersey for the purchase of a pair of $645,000 diamond earrings he purchased in Europe from a jeweler who turned over the earrings to a member of Zukerman’s family in Manhattan but charged no sales tax.

Zukerman is further charged with attempting to hide from the Internal Revenue Service, a $130 million sale of a petroleum company he owned, providing false information in a subsequent tax audit, providing “phony charitable contributions”  in his tax returns, and diverting corporate assets for personal use.

In the indictment Bharara states: “Zukerman cheated on virtually all of his various tax obligations.”

According to a corporate bio on, Zukerman serves as president of M.E. Zukerman & Co. He spent 16 years with Morgan Stanley, including as joint head of Morgan Stanley’s energy group.

If convicted of the charges—one count of tax evasion, one count of wire fraud, and one count of obstructing the IRS—Zukerman faces up to 28 years in prison.

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