Tuesday, August 13, 2013

After 4 Years of IRS Audits, Fl. Business Man Pays $37MM & is Sentenced to 10 Yrs in Prison.

John D. Stanton III stalled an Internal Revenue Service audit for four years, promising he would submit corporate tax returns for his company while secretly diverting tens of millions of dollars to himself.

“You defrauded the government out of millions of dollars. Your purposely evaded the IRS,” U.S. District Judge Virginia M. Hernandez Covington told the 64-year-old Stanton. “You’re a very intelligent and shrewd man and you engaged in a steady, ongoing pattern of criminal conduct.”

In 2011, Stanton left Tampa after refusing to pay Susan Stanton the $6 million the court said he owed her. John Stanton III was on the run for nine months, evading arrest until September 2012, when he was nabbed at a Fairfield Inn in Orlando.

The deception caught up to him, when a federal judge sentenced him to 10 years in prison for tax evasion. Stanton III, who was also ordered to pay $37 million in restitution, declined to speak at the hearing.

He was once the co-owner of Cast-Crete Corp. of Seffner, one of the nation’s biggest manufacturers of precast concrete materials. Between 2005 and 2007, the company made a profit of $108 million and owed taxes amounting to $37 million, which was never paid because tax returns for those years were never filed.

He was siphoning off millions of dollars from Cast-Crete during those three years, according to court documents, paying himself or his shell company $12 million in 2005, $22 million in 2006 and $9 million in 2007.
“His plan was to drive the corporation into bankruptcy and clean up the tax mess in bankruptcy court,” U.S. Attorney Robert Monk said.
Stanton, who has a masters of business administration degree and was a certified public accountant, “made a pretense of cooperating” with the IRS audit “but in fact he stalled and impeded the agent’s ability to get at the truth,” court documents said.

Stanton created fake promissory notes, board resolutions and other documents to hide the deceit, prosecutors said. Stanton also tried to place the blame on Cast-Crete co-owner Ralph Hughes, a conservative power broker who died in 2008, Monk said.

The IRS said Stanton eventually owed a total of $60 million in taxes.

When he was arrested, Stanton said he was broke; prosecutors said they believe Stanton has hidden his money, perhaps millions of dollars.

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