Political watchdog group Citizens for Responsibility and Ethics in Washington (CREW) recently requested that the Internal Revenue Service (IRS) investigate whether Virginia Governor Robert McDonnell (R) and his wife, Virginia Attorney General Kenneth Cuccinelli (R), and Star Scientific, Inc. violated tax laws by failing to report as gifts or income certain payments and gifts made to the state officials. According to CREW, during the past two years, the governor and his wife received at least $166,150 in payments, goods and services from Star Scientific CEO Jonnie Williams Sr., a trust that he controls and the company. The McDonnells in return allegedly promoted Anatabloc®, a dietary supplement that CREW claims is critical to Star Scientific’s success, given losses over 10 years and about $29 million in 2012 alone.

Williams has reportedly cooperated with prosecutors conducting a public corruption probe. He will apparently be able to provide insight into whether the governor and his wife took official action in exchange for gifts ranging from shopping trips, vacations, a Rolex watch, money for their daughter’s wedding, and a purported loan. Star Scientific has, according to a news source, informed investors that it is also facing a securities investigation. At one time, the attorney general was allegedly one of those investors and also received some $19,000 in goods and services from Williams and Star Scientific, including a box of Anatabloc® valued at more than $6,500. While CREW acknowledges that the state officials have amended their financial disclosure forms, it asks the IRS to determine whether and how the cash and goods were reported on their tax returns. See CREW Press Release, July 23, 2013; and The Washington Post, August 3, 2013.