In 1975, Tarnopol, along with Clive Davis of Arista Records, Kenny Gamble of Philadelphia International and sixteen other independent record executives were charged on a variety of financial irregularities stemming from a government investigation of payola in the record industry.
One of the highlights of the federal tax fraud trial of Tarnopol and seven Brunswick executives came when Eugene Record testified that he had been assaulted during a contract negotiation at Brunswick's New York office.