Ron Paolucci, at one time one of the winningest racehorse owners in North America who co-owned 2013 Breeders' Cup Juvenile Fillies (G1) winner Ria Antonia, was sentenced Sept. 16 to 52 months in prison for tax fraud and evasion and ordered to pay more than $38.9 million in restitution to the Internal Revenue Service.
His sentencing came more than 18 months after Paolucci entered a guilty plea on two counts in a Texas federal court for his actions while serving as co-founder and an employee of American Management Staffing.
According to court records, the prosecution alleged Paolucci for seven consecutive years ending in 2020 failed to remit more than $13 million to the Treasury Department of employee withholdings for income, Medicare, and Social Security taxes due from American Management Staffing, and other entities under the company's umbrella. Paolucci, 55, was employed by AMS from approximately 2011-20 and had control over AMS' business affairs, including approving payments and controlling AMS' bank accounts, the government said.
The offenses occurred in the Dallas area within the jurisdiction of the United States District Court for the Northern District of Texas.
The U.S. Attorney's Office for the Northern District of Texas issued a press release Sept. 17 announcing the sentencing by U.S. District Judge Sam A. Lindsay. Assistant U.S. Attorney Marty Basu prosecuted.
"We were proud to partner with IRS-CI on this important case," U.S. Attorney Leigha Simonton said in the release. "We stand ready to prosecute any employer who pockets employees' payroll taxes and those who otherwise refuse to meet their tax obligations."
Christopher J. Altemus Jr., special agent in charge of IRS criminal investigation for the Dallas field office, added in the release that Paolucci's "failure to remit withheld taxes is not only a breach of trust but a serious crime with severe consequences."
He noted that Paolucci failed to report his personal compensation and was ordered to pay approximately $10 million in restitution for his personal tax obligations.
Paolucci owned numerous stakes winners as Loooch Stables, the most accomplished of which was Ria Antonia, who he campaigned in partnership with Christopher T. Dunn. Second across the wire in the 2013 Breeders' Cup Juvenile Fillies, she was awarded first place via the disqualification of She's a Tiger for interference. Loooch Stables later won graded stakes races as a co-owner in Imperative and War Story.
Paolucci entered horse ownership in 2011 and expanded to race a large stable of horses. Not counting partnerships, Loooch Stables had 3,710 starts from 2011-18, ranking fourth in wins nationally in 2014 and 2015, seventh in 2016, and second in 2017 and 2018.
He later owned horses as Ron Paolucci Racing from 2019-22.
