The Justice Department on Friday sued Roger Stone, a former loyal adviser to former President Donald Trump, alleging that he and his wife owe nearly $ 2 million in unpaid federal taxes and other fees.
The lawsuit accuses Stone and Nydia Stone of using an “alter ego” company to try to “protect their personal income from forced collection and finance a lavish lifestyle.”
The civil complaint also alleges that the Stones “intended to deceive the United States” by fraudulently transferring money used to buy their home.
Stone, 68, a longtime Republican political operative, was pardoned by Trump in December after being convicted of lying to Congress.
The DOJ complaint, filed in federal court in South Florida, alleges that Stone and his wife paid their federal income taxes for five consecutive years, between 2007 and 2011. The Stones owe 1,590,361.89 dollars, including interest and penalties for delay, according to the complaint.
The lawsuit also alleges that Stone failed to pay his full tax bill in 2018, when it was filed separately from his spouse. In the complaint, he owes $ 407,036.84 in income taxes, interest and penalties for this year.
“Despite the notice and the demand for payment, Roger and Nydia Stone have failed and refused to pay all the obligations they owe,” the DOJ alleges.
Stone did not immediately respond to an email requesting a comment on the lawsuit.
The complaint alleges that the Stones “evaded and thwarted the IRS’s collection efforts” by using a Delaware limited liability company called Drake Ventures. The company is “dominated and controlled” by the family “to such an extent that it does not exist as an independent entity,” the DOJ alleges.
Drake Ventures has no website or phone number, all of its members are part of Stone’s family and his address is the same as the Stones’ home in Fort Lauderdale, Florida, according to the complaint.
“The Stones used Drake Ventures’ bank accounts to pay a substantial amount of their personal expenses, including groceries, dentist bills, spas, salons, clothing and restaurant expenses, ”according to the complaint.
They also paid more than $ 500,000 of their personal tax liabilities through Drake Ventures bank accounts in 2018 and 2019 and used the company to pay Stone’s associates and relatives without providing proper documentation, the DOJ alleges.
“The Stones used Drake Ventures for an improper purpose and harmed the United States,” according to the complaint. “They used Drake Ventures to receive payments that Roger Stone must personally pay, pay their personal expenses, protect their assets, and avoid reporting taxable income to the IRS.”
The DOJ lawsuit also accuses the Stones of fraudulently transmitting their home through a revocable Florida trust they created called the Bertran Trust.
The Stones had signed an agreement with the IRS in May 2017 to pay $ 19,485 a month for its unpaid taxes, according to the complaint.
After Stone was indicted in January 2019, her family set up the Bertran Trust and bought her home in her name, using money they had transferred to that Drake Ventures entity to make an initial payment of $ 140,000.
In March 2019, the Stones were unable to make the monthly payment to the IRS, prompting the agency to withdraw from the fee plan.
“The Stones intended to defraud the United States by keeping their assets in the accounts of Drake Ventures, which they fully controlled, and using those assets to buy the Stone Residence on behalf of the Bertran Trust,” the complaint alleges.
The DOJ says “numerous badges of fraud” marked the purchase. The complaint alleges that the Stones were insolvent and “unable to pay their debt”; face the threat of litigation; and anticipating that the IRS “would resort to forcible collection of its unpaid tax liabilities once they default on monthly payments.”