Atlantic City socialite John Schultz could have faced up to 5 years in the slammer for defrauding the IRS of $119,800 in unpaid taxes. Instead, the former Atlantic City Councilman was sentenced to six months in prison & 6 months of house arrest.
Schultz is a founding member of the MBCA; Atlantic City Metropolitan Business & Citizens Association. The 71 year old entrepreneur / socialite is married to Gary Hill, a co-founder of the same MBCA charity. ( Hill is also on the boards of the MUA & CRDA )
Schultz has been in legal hot water before. In 2009, during his decade long stint as an Atlantic City councilman, was accused of being part of blackmail scheme against another councilman who was lured to a motel and secretly videotaped having sex with a prostitute.
John Schultz officiated at the marriage of Atlantic City Mayor Don Guardian & Louis Fatato in 2014.
Schultz’s business background includes being the founder of the former Studio Six gay bar in Atlantic City, and a co-creator of the Miss’d America drag pageant.
Schultz and partner Gary Hill are well known for their Schultz-Hill Foundation and parties inside their palatial nine-story building on Pacific Avenue in Atlantic City.
Schultz pleaded guilty to hiding cash from his Atlantic City Boardwalk rolling-chair business.
Judge Rodriguez mentioned Schultz’s net worth is about $2 million, and wondered why he would commit this crime. He lives in a penthouse that includes an indoor swimming pool, a home theater and two elevators.
Judge: Greed was the motivating factor.
This is not the first time Schultz had a run-in with the law. According to the Press of Atlantic City, he was indicted in 2007. It was a scheme to blackmail Councilman Eugene Robinson by paying a prostitute to seduce him and filming the tryst.
Background from 2009 New York Post:
Four Atlantic City men — including a local politician — have been ordered to trial in an alleged plot to blackmail another pol by secretly videotaping him with a hooker in a seedy motel.
Prosecutors claim that councilman John Schultz, along with pals Floyd Tally and David and Ronald Callaway, hired a prostitute to lure councilman Eugene Robinson into the Bayview Motel in Absecon in 2006.
Robinson — who is also a Baptist minister — was videotaped giving the woman money before she performed oral sex on him.
The men threatened to go public with copies of the preacher’s steamy porn session unless Robinson resigned.
A judge yesterday set a Sept. 26 trial date for the four men after they failed to accept a plea deal.
The mastermind of the twisted plot — former Atlantic City Council president Craig Callaway — has already pleaded guilty in the case and was sentenced to three years. Callaway also is serving a 40-month federal sentence for bribery.
Instead of resigning when he learned of the tape, Robinson went to authorities.
He has since insisted that the sex with the prostitute was consensual, and claims that he only gave her money to buy a soda.