Texas Scrap Dealers Convicted of Tax Charges

The five convicted are: Michael Evans, Joe Nicholas, Joe George, Mack George, and Mike George.

Last January, at a hearing before United States District court Judge Vanessa Gilmore, Evans admitted that he filed a false federal income tax return for calendar year 2001 in which he reported profits of $111,684 from his scrap metal recycling business when his actual net profits for that year were approximately twice that amount.

Evans admitted he had also filed tax returns for 1999 and 2000 that substantially under-reported taxable income. For the 1999 tax year, Evans admitted he understated income on his income tax return by $24,400. On his 2000 tax return, Evans admitted having reported a profit from his scrap metal recycling business of $47,075, when it was actually about three times that amount. All totaled, Evans admitted that he had knowingly underpaid taxes of about $78,466.

Joe Nicholas and brothers Joe George, Mack George and Mike George were each convicted on January 10, 2006, of tax violations in hearings held before United States Magistrate Judge Mary Milloy.

During his hearing, Joe Nicholas acknowledged that his profits from a scrap metal business, a roofing business, and the purchase and resale of recreational vehicles and heavy equipment during 1996-2001 were about $272,600, and admitted he had intentionally failed to file income tax returns for each of those years and to pay approximately $54,500 in taxes.

Nicholas further admitted that he had used a check cashing service that did not file Cash Transaction Reports with the Internal Revenue Service on checks cashed in excess of $10,000, as required by law.

Brothers Joe George, Mack George, and Mike George acknowledged that they had operated a scrap metal business during 1996–2000 with revenues in excess of $2 million. Mike George left the business and moved to Dallas in 2000.

Joe George admitted he had intentionally failed to file income tax returns for 1999 and 2000 and avoided paying taxes of about $30,400. Mack George admitted he had intentionally failed to file income tax returns for 1996 through 2001 and avoided paying taxes of about $59,515.

Lastly, Mike George admitted he had intentionally failed to file income tax returns for 1996 through 2000 and avoided paying about $47,220 in taxes.

The investigation resulting in the charges against these five defendants was conducted by the Criminal Investigation Division of the Houston Office of the IRS. The cases are being prosecuted by Assistant U.S. Attorney Jimmy Sledge.