Developer with Olympia roots pleads not guilty to tax evasion and Social Security fraud

Staff writerAugust 6, 2013 

 

Thomas R. Hazelrigg III, the former Olympia High football star from a prominent family who grew up to be a lender and developer, entered not guilty pleas this week to four federal charges of tax evasion and Social Security fraud in Seattle.

The United States Attorney’s Office in Seattle put out a news release detailing Hazelrigg’s alleged criminal actions and what it called “lavish” spending by the onetime Bellevue resident, who now lists a Rancho Mirage, Calif., address.

Prosecutors said Hazelrigg, 67, concealed millions of dollars of assets from federal tax authorities during 2005-07, while continuing to avoid payment of taxes owed for 1989, 1990 and 1991.

He is accused of making outlays during that time for renovations of a $3 million Bellevue penthouse, of buying Chihuly chandeliers worth more than $460,000, and gambling heavily with the purchase of more than $1 million in casino chips. The government says he also spent on thoroughbred horses, private jets and country-club fees.

The fraud allegation involved bank accounts opened in 2007 using the Social Security number of his late father, Dr. Thomas Hazelrigg, prosecutors said. The father was a well-known Olympia doctor and first surgeon to work at Olympia’s landmark Memorial Clinic.

Defendant Hazelrigg was represented by a public defender when he entered his pleas Monday before U.S. District Court Magistrate Judge Mary Alice Theiler. If convicted he faces up to five years in prison on each of the two tax charges and each of the two charges of misusing Social Security numbers, according to prosecutors.

His trial is set for Oct. 14 before federal Judge Thomas Zilly, U.S attorney spokeswoman Emily Langlie said. Theiler released Hazelrigg on his own recognizance but ordered him to surrender his passport, to limit his travel to the Western Washington court district or to Southern California where he could see his heart specialist, and to do no gambling, Langlie said.

He is to be represented at trial by Seattle attorney Peter Mair. Neither Mair nor his public defender returned calls asking for comment.

A grand jury returned its indictment against Hazelrigg on July 31. Jenny Durkan, the U.S. attorney for Western Washington, signed the indictment.

Hazelrigg attended Olympia High where he played on an undefeated football team in 1963. That exploit landed him among the area’s athletes of the century in an Olympian story published in early 2000. He went on to attend Stanford University where he played linebacker, and he was drafted by the Denver Broncos but never played in games.

The Seattle Times profiled Hazelrigg in 1993, saying he never played professional football because of an injury but that he used his Broncos’ signing bonus to buy duplexes and other properties and then fix them up before going into bigger projects.

That 1993 report depicted Hazelrigg as “The Repo Man” for his hard-hitting approach to buying and collecting on developers’ and contractors’ debt – and his tactic of freezing their assets and credit lines to force them into settlements.

The profile said Hazelrigg also was involved in a Palm Springs hotel project developed with Michael R. Mastro, the former developer from Bellevue. Mastro more recently fled with his wife to Europe to avoid creditors whom they owed an estimated $325 million.

The Mastros were indicted last fall in Seattle for bankruptcy fraud and money laundering. But after their arrest in France a French court refused to let Mastro, 88, and his wife be extradited without assurances they would not serve jail time.

Prosecutors declined to comment on Hazelrigg’s connection to Mastro. But their indictment against Hazelrigg says he concealed income in 2005-07 by funneling commissions he earned to FRB, Inc. – a Nevada-based firm that is “owned by M.R.M., his long time friend and business associate.” Court documents from other proceedings say FRB is owned by Mastro.

Brad Shannon: 360-753-1688

bshannon@theolympian.com

http://www.theolympian.com/politics-blog/

http://www.theolympian.com/state-workers/

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