‘Pharma Bro’ Martin Shkreli’s debts stoke clash between feds, NY

By TaxesFOXBusiness

‘Pharma Bro’ Martin Shkreli sentenced to 7 years in prison, forfeits $7.5 million in assets

Martin Shkreli, the former pharmaceutical CEO, received a sentence of 7 years in prison for securities fraud and has been ordered to forfeit assets worth $7.5 million.

As convicted fraudster Martin “Pharma Bro” Shkreli serves prison time for swindling investors out of millions of dollars, New York state and federal authorities are clashing over who will be first to collect on his sizable backlog of debts.

Continue Reading Below

Shkreli, who was ordered to forfeit more than $7 million in assets at his sentencing hearing in March, owes the IRS more than $1.6 million from a 2015 tax lien. The former pharmaceutical executive also owes New York $480,000 from a $1.2 million tax bill in 2016.

In a Monday filing in Brooklyn federal court, an IRS attorney argued Shkreli should first pay his debt to the federal government because its bill was filed first, the New York Post reported.

“Martin Shkreli has failed, neglected, or refused to pay in full the liability for the income tax year 2015,” the filing said.

New York officials had already requested that Shkreli address his debt to the state before meeting the obligation on the more than $7 million in asset forfeitures. Former New York State Attorney General Eric Schneiderman, who resigned earlier this month amid allegations of sexual misconduct, said in an April 21 filing that Skhreli’s debt to the state should be paid first because it existed before he was sentenced.

The IRS has vowed to pursue Skhreli’s personal assets, including the only existing physical copy of the infamous Wu Tang Clan album “Once Upon a Time in Shaolin,” if Shkreli cannot pay his debt.

Shkreli drew near-universal criticism in late 2015 when, as the former CEO of Turing Pharmaceuticals, he ordered a massive increase in the price of the life-saving drug Daraprim. He earned the nickname “Pharma Bro” in part for his brash public persona and heated clashes with critics.

The 35-year-old former executive is currently serving a seven-year prison sentence at a federal prison in Fort Dix, New Jersey.

What do you think?

Click the button below to comment on this article.