June 28, 1974, Page 31Buy Reprints
The corporation that owns a 45‐story midtown office building was indicted yesterday on charges of fraud in obtaining sizable reductions in the building's real estate taxes.
The indictment — involving the Nelson Tower Building, on Seventh Avenue between 34th and 35th Streets — is the second this month to result from a year‐long investigation by the Manhattan District Attorney's office into charges that major owners of real estate had cheated in getting the City Tax Commission to reduce property‐tax valuations. Reduced valuations mean lower taxes.
Yesterday's indictment named the 450 Seventh Avenue Corporation, owner of the Nelson Tower, which has that address, as the defendant. No officers of the corporation were indicted.
“The grand jury heard all the witnesses and didn't indict anyone by name,” said a spokesman for District Attorney Richard H. Kuh, whose office announced the indictment.
False Statements Alleged
The indictment, the spokesman said, states that the corporation submitted false rental‐income statements to the Tax Commission in seeking reductions of property valuations set by assessors for the 1971 and 1972 fiscal years. The reductions granted, a total of $375,000 for both years, led to tax savings of $22,337 for the two years, the spokesman said.
The attorney for the indicted corporation, James B. M. McNally, a retired Appellate Division justice, entered a plea of not guilty yesterday in State Supreme Court. In an interview later, he denied Any fraudulent intent on the part of the corporation.
“If there were inaccuracies,”he said, “they were minimal in nature and the result of mistakes by the [corporation's] bookkeeper,” whom he described as an elderly woman now in retirement in Florida.
Fines Possible
The garment‐district building includes offices of a number of fabric and textile concerns.
Technically, the owning, corporation is charged with four counts related to its income statements. If found guilty, it can be fined up to $10,000 on each count or, as an alternative, up to twice its tax saving from the alleged fraud.
Mr. McNally said there were more than 30 stockholders in the owning corporation, whose man.
On June 5, the corporations that own the 56‐story Chanin Building, an office tower at Lexington Avenue and 42d Street, and the 30‐story Century Apartments, at 25 Central Park West, were indicted on similar charges, along with the attorney for both these carporations, Samuel Kramer.