Paolucci gets 52-month sentence, must pay $39M in restitution

Ron Paolucci, a horse owner whose Loooch Racing Stables won hundreds of races in the 2010s, was sentenced on Monday to 52 months in prison and ordered to pay $38.9 million in restitution on tax fraud charges, according to the U.S. attorney in Northern Texas, which prosecuted the case.

Paolucci, whose claiming stable generated thousands of starts primarily at minor tracks throughout the Midwest and Southeast, had entered a guilty plea 18 months ago on felony charges of conspiracy to defraud the U.S. and subscribing a false tax return. The charges were related to his work with American Management Staffing, a Frisco, Texas, company that provided temporary workers.

In a release, the U.S. District Attorney for the Northern District of Texas said that Paolucci withheld payroll taxes from the paychecks of the temporary employees, including Medicare and Social Security taxes, but did not transfer the tax withholdings to the IRS, from a period of 2011 to 2020.

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Paolucci also failed to report his “personal compensation” on his tax returns during the period, the attorney’s office said, representing nearly $10 million of the restitution judgment.

During that same period, Loooch Racing was flying high. The stable made 3,710 starts from 2011 to 2018, with 871 wins. Total purse earnings were $15.6 million. The stable was primarily made up of lower-class horses, though some earned in the hundreds of thousands of dollars.

In partnership with Christopher Dunn, Paolucci co-owned Ria Antonia, who was placed first in the 2013 Breeders’ Cup Juvenile Fillies after the first horse across the wire, She’s a Tiger, was disqualified. Other partnerships yielded stakes wins with Imperative and War Story.

Loooch Racing, which was named as a play on the pronunciation of Paolucci, was disbanded in 2018, but Paolucci then formed a stable called Ron Paolucci Racing, which was active up until the investigation by federal authorities became public in 2022. That stable had a big year in 2019, winning purses of $4.9 million from 191 wins, but the operation scaled back massively in the ensuing years.

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