Ronald J. Paolucci, whose Loooch Racing Stables was a perennial leader at Ohio racetracks and ranked second nationally by wins in 2017 and 2018, is awaiting sentencing after pleading guilty in federal court to conspiring to defraud the federal government and filing a false tax return.
Paolucci, of Frisco, Texas, faces up to eight years in prison on the two counts, up to $350,000 in fines, and millions of dollars in restitution to the Internal Revenue Service, according to a Jan. 9, 2023, plea agreement in the Dallas division of U.S. District Court for the Northern District of Texas.
Paolucci admitted to conspiring to defraud the government from 2014 through 2020, by not paying federal income taxes and other payroll taxes that were withheld from employees of American Management Staffing (AMS) and other temporary employment agencies with which he was affiliated. Court documents state that the employment agency received lump sum payments from business clients that hired AMS personnel and was responsible for paying payroll taxes but failed to do so. The employees received false W-2 statements from AMS and affiliated companies showing that their taxes were withheld and paid to government authorities. According to court documents, AMS and other entities withheld $13,561,116 from employees but did not pay over those funds to the IRS and other agencies.
Paolucci also admitted that he failed to report total income he received from AMS from 2012 to 2020 and specifically admitted that line 7 of his IRS Form 1040 federal income tax return for 2017 listed $0 in wages when he received at least $3,327,108 from AMS. Over a six-year period, from 2015 through 2020, Paolucci admitted that he failed to report $17,631,438 in compensation he received from AMS.
Loooch Racing Stables won 871 races from 3,710 starts for earnings of $15,638,791 from 2011 through 2018. He was involved in multiple partnerships that campaigned Grade 1 winners Ria Antonia and Sharp Azteca, and $3.3 million earner War Story.
In July 2018, complaining that he was mistreated by racing officials as an outsider, Paolucci said he was leaving the sport. The stable continued operations, however, finishing the year with 215 wins, second only to Karl Broberg's End Zone Athletics' 292 wins. The previous year, Loooch Racing finished second by wins, with 160.
In 2019, operating as Ron Paolucci Racing LLC, Paolucci had 799 starts and 191 wins, third best in North America. He had 240 starts and 45 wins in 2020, then 10 wins from 31 starts in 2021. Paolucci had just 10 starts and one win in 2022, his last runner coming at Thistledown last May 17.
The post Leading Owner Paolucci Faces Jail Time After Pleading Guilty To Tax Fraud appeared first on Horse Racing News | Paulick Report.
