According to an article in today’s Deseret News, David Plummer, Spencer Plummer and Terry Green have pleaded guilty to conspiracy to defraud the United States, as operators of a fraudulent Utah-based tax shelter that offered benefits for leasing Thoroughbred mares.

Investors in the breeding program, operated through a company called ClassicStar LLC, filed tax returns with the IRS claiming tax deductions of more than $500 million, resulting in a more than $200 million tax loss to the federal government.

According to officials, investors were told they could take deductions on their federal income tax returns for losses generated by the breeding operation. The deductions provided investors with tax refunds which were fraudulent, partially because the program used fraudulent loans to finance the leasing of mares.

Officials also said the operators made investors believe their loans were financed, when in fact money was transferred back and forth between various investments to conceal a lack of funds.