Precious Metals Broker Receives 13-Month Prison Term for Evading More Than $394,000 in Income Taxes
MADISON, WIS. -- John W. Vaudreuil, United States Attorney for the Western District of Wisconsin, announced that David Stott, 51, Verona, Wis., was sentenced yesterday by U.S. District Judge James Peterson to 13 months in federal prison for income tax evasion. Stott pleaded guilty to this charge on October 12, 2016. Judge Peterson also imposed a three-year term of supervised release to be served following Stott’s release from prison, and ordered Stott to pay restitution of $394,559 to the Internal Revenue Service.
In May 2016, a federal grand jury sitting in Madison, Wis., returned a five-count indictment charging Stott with three counts of tax evasion, and two counts of structuring currency transactions. The indictment charged that Stott, who worked as a precious metals broker as the owner and operator of a business in Verona called Colorado Gold, attempted to evade taxes he owed for 2010, 2011 and 2012 by underreporting his gross income for each of those years. The indictment also charged that Stott structured currency transactions to evade filing Currency Transaction Reports required by federal law.
At the plea hearing, Stott admitted that he e-filed his tax returns to the IRS for tax years 2010, 2011, and 2012, and underreported his commission income from Colorado Gold in all three years by $612,797, which caused a tax loss of $208,734. Stott also admitted he underreported his commission income on his 2007, 2008, and 2009 tax returns as well, which caused an additional tax loss of $185,825. Over the six-year span from 2007 through 2012, Stott evaded $394,559 in income taxes.
Stott pleaded guilty to one count of tax evasion, but as part of his plea agreement, he agreed to pay restitution for all losses covered by the same course of conduct or common scheme as the offense of conviction.
At yesterday’s sentencing hearing, Judge Peterson noted that Stott committed a serious crime and only accepted responsibility after agents executed a search warrant on his home and confronted him about his conduct. The judge also told Stott he made plenty of money and that his crime was totally unnecessary and motivated solely by greed. Judge Peterson found that Stott knew what he was doing was wrong but was more concerned with maintaining his well-to-do lifestyle.
The charges against Stott were the result of an investigation conducted by IRS Criminal Investigation. The prosecution of the case has been handled by Assistant U.S. Attorney Daniel Graber.