DEFENDANT HITS ROADBLOCK IN ATTEMPT TO HIDE EARNINGS FROM IRS

The owner of a Kansas City scrap metal business has been hit with federal tax evasion charges, accused of attempting to conceal his assets and income from the Internal Revenue Service. Joseph Lee Scott Deardorff, 31, of Kansas City, was indicted by a federal grand jury on four counts, including one count of attempting to interfere with the administration of internal revenue laws and three counts of tax evasion.

According to the indictment, Deardorff received $497,543 in taxable income from 2010 to 2012, but willfully and knowingly failed to file accurate tax returns. The indictment alleges that Deardorff took a series of steps to hide his assets from the IRS, including cashing checks at multiple gas stations and check cashers throughout the metro area.

Deardorff cashed approximately $740,547 of the $743,225 worth of checks he received from the sale of scrap vehicles and scrap metal in calendar year 2010, and continued this practice in 2011 and 2012. In total, Deardorff cashed checks for $1,924,867 of the $1,932,919 of his total receipts during the three-year period.

The indictment also alleges that Deardorff purchased, with cash, all of the scrap vehicles and scrap metal he processed for sale, and used cash from the sale of scrap vehicles and metal to purchase multiple properties for business and investment purposes, as well as multiple Corvettes and high-end GPS units for his tow trucks.

Deardorff also paid all of his employees in cash from 2010 to 2012, failing to file Forms W2 for any of his employees during that time. The contract labor costs in this matter, which were unreported, were approximately $172,800.

The charges against Deardorff are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence. This case is being prosecuted by Senior Litigation Counsel Gregg R. Coonrod, and was investigated by IRS-Criminal Investigation.

Deardorff’s company, Total Recovery and Recycling, LLC, is a business that buys and sells scrap metal and scrap vehicles. The indictment alleges that Deardorff used his business to hide his income from the IRS, and that he willfully and knowingly failed to pay the taxes he owed on that income.

The federal indictment charges Deardorff with one count of attempting to interfere with the administration of internal revenue laws and three counts of tax evasion. Deardorff owed $172,574 in taxes on the income he received from 2010 to 2012, but willfully and knowingly failed to pay that amount.

Deardorff’s case is a stark reminder of the importance of paying taxes and following the law. The IRS takes tax evasion very seriously, and will aggressively pursue individuals and businesses that attempt to hide their income and assets.

The case against Deardorff is ongoing, and he is currently facing a federal trial jury. The outcome of the case is uncertain, but one thing is clear: Deardorff’s actions have put him in a difficult position, and he will have to answer to the court for his actions.

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