Former Total Reclaim CEO sentenced to second prison term for tax fraud

Jeffrey Zirkle, the former owner and co-CEO of electronics recycling firm Total Reclaim, Seattle, was sentenced in U.S. District Court in Seattle to six months in prison for tax fraud, said U.S. Attorney Nick Brown. 

Zirkle, 58, of Gig Harbor, Washington, was sentenced in 2019 to 28 months in prison for defrauding clients by secretly exporting electronic waste to Hong Kong, despite presenting his business as an environmentally friendly recycling service. This second criminal case, prosecuted by Assistant U.S. Attorney Seth Wilkinson, stems from Zirkle using company funds to pay for his personal expenses and failing to report the transactions on his income tax returns.

According to records filed in the case, following the prosecution of Zirkle and his partner, Craig Lorch, for fraud, a new CEO took over Total Reclaim. He discovered that Zirkle had embezzled from the company by charging hundreds of thousands of dollars in personal expenses on company credit cards, according to a news release issued by the U.S. Attorney’s Office. An investigation by the FBI and the Internal Revenue Service Criminal Investigation determined that as much as $480,000 in charges were for personal items and that Zirkle never reported those benefits on his income tax returns. Many of the charges involved the purchase of luxury goods. Zirkle also spent more than $17,000 in corporate funds on a single day to purchase home appliances and more than $15,000 on a home irrigation system. The U.S. Attorney’s Office says, even after his sentencing on the fraud charges in April 2019, Zirkle continued to use the corporate credit card for his own expenses, charging over $5,000 for septic work on his home.

U.S. District Judge James L. Robart ordered Zirkle to pay $125,549 in restitution to the government for the tax losses.

In the earlier criminal case, an Environmental Protection Agency investigation concluded that Total Reclaim secretly exported more than 8 million pounds of monitors containing toxic materials, such as mercury. The investigation revealed that Zirkle and his co-defendant concealed this practice by submitting fraudulent documents to auditors and customers and falsified more documents when the practice was discovered.

Because of pandemic concerns, Robart ordered Zirkle to begin serving his sentence in early August of 2021. Over the objections of the prosecutor, Zirkle asked for the delay in serving his time so he could attend two family weddings. He will be on 18 months of supervised release for the tax crimes following his prison term.