A Palm Beach County resident was sentenced to 24 months in prison for evading taxes and hiding funds in offshore accounts, bankrolling his lavish lifestyle that included buying a $1.6 million Lake Worth Beach mansion.
Dusko Bruer, who owned and ran the profitable farming equipment company American Made Equipment, did not report $7.7 million in income from 2007 to 2014 and secretly stashed nearly $6.3 million in Swiss, German, Serbian and Croatian banks, prosecutors said in court filings. He did not file tax returns and also filed false tax forms, evading payment of nearly $2.8 million to the Internal Revenue Service.
Federal Judge Kenneth Marra sentenced Bruer on Friday, also imposing two years of supervised release and payment of owed taxes.
Bruer was charged in January 2020 with attempting to evade taxes and failure to report foreign bank or financial accounts. He pleaded guilty to both charges the following April.
The verdict is a reduction of the 10 years imprisonment and six years supervised release Bruer faced prior to his guilty plea.
Bruer’s attorney, Joel Hirschhorn, said he fought for probation and special conditions, while federal prosecutors insisted on a 57-month sentence. “The judge didn’t quite cut the baby in half, but he cut it in more than half,” said Hirschhorn, a GrayRobinson shareholder.
Bruer admitted in court filings that he transferred money from an account with Swiss bank Clariden Leu — which has since merged with Credit Suisse — by telling the bank the money was a loan to a family member. Instead, he bought the 3,200-square-foot Lake Worth Beach house for his then-girlfriend.
Records show Kathryn Stieh bought the three-bedroom house with 100 feet of frontage on the Intracoastal Waterway in August 2011. The home was built in 1962. Stieh transferred ownership to Bruer and herself in 2013. In 2015, the title reverted back to Stieh as the sole owner.
Hirschhorn said he has seen no indication the government will go after the property in either a forfeiture or tax lien.
In some of his other lavish spending, Bruer covered $21,000 in fees for a New York condominium unit owned by a family member, and paid $255,000 for property in Serbia, he admitted in court filings.
Prosecutors’ filings also say Bruer spent $370,000 to buy, register, dock and service a 54-foot yacht, and paid $1.4 million for a 90-foot yacht.
Although Bruer “skimmed” funds from his business and secretly stashed it offshore, it is important to note this was legally earned income, Hirschhorn said. “This was not drug money or money earned by defrauding people,” he added.
Hirschhorn called Bruer a sharp businessman who is extremely remorseful and in part fell victim to “tragic” circumstances. Bruer had moved to the U.S. as a youth from his native Croatia after his mother’s death and father’s severe injury from a car accident. He faced other downturns, including a divorce that threw him into depression. “He decided to self-medicate through a playboy lifestyle, which never works,” Hirschhorn said. “While none of this is an excuse, it’s an explanation.”
This is not the first time South Florida real estate is linked to criminal charges, although other cases allege funds were illicitly obtained.
A unit at Sunny Isles Beach’s Porsche Design Tower was used as payment to one of the money launderers charged in 2018 in a $1.2 billion scheme to embezzle from Venezuela’s state-owned oil company PDVSA, prosecutors charged.
Authorities also last summer sought to seize a penthouse at a downtown Miami condominium tower at 900 Biscayne Boulevard that allegedly was purchased by the Republic of the Congo’s president’s son with funds taken from the state-owned oil company, according to a civil forfeiture complaint.