3 Vancouver projects in IRS probe

SEATTLE (AP) — Three wealthy real-estate developers, including a former state Senate candidate, failed to report nearly $25 million in income from three Vancouver shopping-center projects, an Internal Revenue Service agent alleges in court documents.

No charges have been filed against the three — Bellevue developer Winston Bontrager; his girlfriend, Pauline Anderson; and his son, 2004 Republican state Senate candidate Jason Bontrager. Agents raided their homes and offices this month as part of an investigation into their income since 2000 from the Salmon Creek, Hazel Dell and Eastgate Plaza developments.

Seattlepi.com first reported on the searches Tuesday.

Joseph Lopez, an agent with the IRS Criminal Investigation Division, wrote in a search warrant application filed in U.S. District Court that the three conspired to conceal their income by overstating business expenses, underreporting income and moving money among dozens of bank accounts in the U.S. and Australia.

A phone message left with their company, Alexandria Development, was not immediately returned. Home phone listings could not be found, and an e-mail sent to Jason Bontrager seeking comment wasn’t immediately returned.

‘Lavish lifestyles’

The three “are living lavish lifestyles residing in million-dollar homes in Washington, driving luxury automobiles, and vacationing in million-dollar winter homes in Southern California,” Lopez wrote.

Meanwhile, they were paying little to no federal income taxes, he alleged. Nor was Winston Bontrager, 61, paying $680,000 in restitution he still owes from a 1994 fraud conviction.

The shopping-center deals brought the three at least $47 million, and they failed to report $24.7 million, Lopez wrote.

One of the deals involved Michael R. Mastro, a developer who last year was forced into one of the biggest bankruptcies in state history, with more than $570 million in liabilities. Mastro was wired $4 million in connection with the Eastgate deal after Wal-Mart bought part of the property for $9.9 million in 2004.

Mastro’s role in the deal isn’t fully clear, Lopez wrote. One of his companies, Sifton/Orchards, bought out the Eastgate property in 2007 for $14.3 million.