(CNN) New York state authorities sweetened a plea offer made to a taxi operator who partnered with President Donald Trump's personal lawyer Michael Cohen after federal authorities raided Cohen's home, office and hotel room, according to court transcripts.

Evgeny "Gene" Freidman, known as New York's "Taxi King," pleaded guilty last week to criminal tax fraud for failing to pay $5 million in taxes in a deal that would allow him to avoid prison time.

The no-prison deal was a significant enhancement from an offer Freidman rejected on April 4 -- just a few days before the FBI raid on Cohen -- that would have included a minimum of two years and as much as six years in prison and a $1 million fine, according to transcripts of the March court proceeding. The offer included a sliding scale; if Freidman paid less than $1 million he would face more jail time. Friedman had faced as much as 25 years in prison when he was charged last year.

The investigation by US prosecutors in Manhattan was initiated in part by a referral from special counsel Robert Mueller. FBI agents working with Mueller have interviewed several business partners of Cohen as part of Mueller's broader inquiry into election meddling. Freidman's cooperation in the deal suggests he has useful information for prosecutors and could place added pressure on Cohen, who has been Trump's attorney for a decade, to cooperate with authorities.

The initial offer and subsequent enhancement has not been previously reported. New York investigators made the initial offer in late March. When Freidman rejected the deal at the hearing two weeks later, John Healy, a lawyer with the state attorney general's office, told Justice Peter Lynch, "The offer is withdrawn. We don't intend to make any offers and we are ready for trial come June 18."

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