Former Head of Loooch Stables Guilty of Tax Fraud

Ron Paolucci, the former head of Loooch Stables, entered a guilty plea Feb. 28 to two counts of tax fraud and evasion in a Texas federal court.

Paolucci was charged Jan. 9 with conspiracy to defraud the U.S. government and filing a false tax return. According to court records, the prosecution alleged Paolucci for seven consecutive years ending in 2020 failed to remit over $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.

The offenses occurred in the Dallas area within the jurisdiction of the U.S. District Court for the Northern District of Texas. The Paulick Report first reported the story.

According to charges filed with the court, Paolucci on his own and in conspiracy with unidentified persons described as Individual A and Individual B, withheld payroll taxes from employees without turning them over to the Treasury. Quarterly withholding reports called 941s were not filed beginning in 2014, but false W-2s showing withholdings were issued annually to employees.

The charges also accused Paolucci with failing to report over $3 million income for tax year 2017.

On the same day he was charged, Paolucci entered a plea agreement admitting the charges. He is facing not more than five years' imprisonment and a fine of $250,000 on the charge arising from failing to pay withholding, and up to three years and a $100,000 fine for filing a false tax return.

Substantial restitution is also owed under the plea deal, including $13,561,116 for the multiple withholding infractions, interest on the withholding, and income tax on unreported 2017 income and on all income for tax years 2015 through 2020 along with penalties and interest. According to the plea agreement, Paolucci agreed that all sums will be due immediately upon sentencing and be subject to immediate enforcement by government agents.

Paolucci was not committed to the Bureau of Prisons after his guilty plea. A condition of his freedom pending sentencing is to cooperate with the government and to have no contact with co-defendants whose names were not disclosed. A sentencing date was not available in online court documents when this story was filed.

Pending sentencing, Paolucci was ordered to participate in substance abuse therapy if recommended by pretrial services, to surrender his passport, to remain within the northern and eastern districts of Texas unless officially approved, and to submit to a federal supervision officer.

Paolucci achieved a measure of fame in the world of Thoroughbred racing with his Loooch Racing Stables when, in partnership with Christopher T. Dunn, Ria Antonia  won the 2013 Breeders' Cup Juvenile Fillies (G1) via disqualification after She's a Tiger  held her off by a nose. According to Equibase, Loooch had 3,710 starts from 2011-2018, ranking fourth in wins nationally in 2014 and 2015, seventh in 2016 and second in 2017 and 2018.