The owner of an accounting firm and a real estate company in Boston was sentenced earlier this week in federal court in Boston for paying an executive more than $1.6 million in compensation and fringe benefits under the table, and making a fraudulent application for more than $179,000 in pandemic relief through a multi-year scheme.
Charles D. Katz, 64, was sentenced by U.S. District Court Judge Leo T. Sorokin to two months in prison, to be followed by two years of supervised release.
In November 2025, Katz was charged and pleaded guilty to conspiracy to defraud the United States and two counts of loan fraud.
Katz and Stephen Hochberg, who served as the Director of Corporate Services at Katz’s accounting firm and as Chief Operating Officer at Katz’s real estate firm, agreed that Katz would pay Hochberg off the books so that Hochberg would have tax-free income and so that Katz’s firms, CD Katz LLC and Gebsco Realty Corporation, would have lower employment taxes.
Over time, Katz paid Hochberg’s family, provided rent-free housing to Hochberg’s ex-wife, paid college tuition for Hochberg’s children, and paid personal expenses that Hochberg and his ex-wife charged on corporate credit cards. All told, Katz paid Hochberg at least $1,668,487 in unreported income and avoided taxes of at least $835,105. In 2020, Katz and Hochberg fraudulently applied for Paycheck Protection Program loans for both of Katz’s firms and obtained $179,900, which Katz used in part to fund the under-the-table compensation he paid Hochberg.
Katz and Hochberg’s tax scheme allowed Hochberg to avoid paying court-ordered restitution to victims of his prior crimes in United States v. Stephen Hochberg, No. 08-cr-10126-NMG. As part of Katz’ sentence, he agreed to pay $333,697.40 in restitution to Hochberg’s prior victims, in addition to restitution of $751,683.62 to the IRS; $83,422 to the Massachusetts Department of Revenue; and $179,500 to the Small Business Administration.
In April 2026, Judge Sorokin sentenced Hochberg to 24 months in prison, to be followed by three years of supervised release and $2,888,288 in restitution.
On March 26, 2026, United States Attorney Leah B. Foley announced the creation of the Benefit & Voter Fraud Team, a district-wide initiative established in response to the rampant fraud being uncovered across Massachusetts. The Team is led by two senior federal prosecutors serving as Fraud Coordinators, whose mission it is to aggressively investigate and prosecute misuse of taxpayer-funded benefits in Massachusetts.
Members of the public are encouraged to report suspected benefit fraud in Massachusetts by calling 1-855-SCAM-MA-1 (855-722-6621).
On April 7, 2026, the Department of Justice announced the creation of the National Fraud Enforcement Division. The Fraud Division is investigating and prosecuting those who commit fraud against the American people. The Department’s work to combat fraud supports President Trump’s Task Force to Eliminate Fraud, a whole-of-government effort chaired by Vice President J.D. Vance to eliminate fraud, waste, and abuse within Federal benefit programs.
United States Attorney Leah B. Foley; Thomas Demeo, Special Agent in Charge of the Internal Revenue Service Criminal Investigation, Boston Field Office; and Ted E. Docks, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division made the announcement. Assistant U.S. Attorney Carol E. Head, Chief of the Asset Recovery Unit prosecuted the case.
