Seattle – The former owner and co-CEO of an electronics recycling company was sentenced in US District Court in Seattle today to 6 months in prison for tax evasion, US Attorney Nick Brown announced. Jeffrey Zirkle, 58, of Gig Harbor, Wash., was the owner and co-CEO of Total Reclaim, the Northwest’s largest e-waste recycler. In 2019, Zirkle was sentenced to 28 months in prison for defrauding customers by secretly exporting e-waste to Hong Kong while promoting his company as an eco-friendly recycling service. Today’s second criminal case stems from Zirkle using company funds to pay personal expenses and failing to report the transactions on his tax returns.
During today’s sentencing hearing, U.S. District Judge James L. Robart said, “He defrauded the company and defrauded the government for years…. He has no respect for the law. Judge Robart ordered Zirkle to pay $125,549 in restitution to the government.
“Those who don’t pay their taxes aren’t just cheating the government, they’re also robbing taxpayers who play by the rules. But despite earning nearly a million dollars a year, Mr. Zirkle refused to pay his fair share,” said US attorney Nick Brown. “At the same time that he was misleading clients about his company’s business practices, he was also lying to the IRS by falsely labeling his personal expenses as business expenses. No one is above the law.”
According to filings in the case, following lawsuits against Zirkle and his partner for fraud, a new CEO took over Total Reclaim. This executive discovered that Zirkle had embezzled the company by charging hundreds of thousands of dollars in personal expenses to company credit cards. An FBI and IRS:CI investigation determined that up to $480,000 was for personal items and that Zirkle never reported these benefits on his tax returns. Many of the charges were for buying luxury goods: over $4,000 at Louie Vuitton Las Vegas, $4,000 as a down payment on a motocross bike, and over $15,000 for partial payment for a vintage 1966 Chevrolet Chevelle . Zirkle also spent over $17,000 in business funds in a single day to buy appliances and over $15,000 for a home irrigation system. Even after his fraud conviction in April 2019, Zirkle continued to use the company’s credit card for his own expenses, charging more than $5,000 for septic work at his home.
In October 2021, Zirkle pleaded guilty to filing false tax returns from 2008 to 2017. Zirkle negotiated a settlement with Total Reclaim regarding the expenses. Zirkle was ordered to pay $125,549 in restitution for the tax loss.
“Mr. Zirkle not only defrauded the government and endangered the environment, Mr. Zirkle also had the audacity to further line his pockets by stealing his own business,” said Special Agent in Charge Bret Kressin, IRS Criminal Investigation (IRS:CI), Seattle Field Bureau “IRS:CI is committed to investigating financial and tax crimes, and we will not let these crimes go undetected. Today’s sentencing is proof of this commitment, and the conviction represents further justice for Mr. Zirkle’s schemes.
In the previous criminal case, an EPA investigation found that Total Reclaim secretly exported more than eight million pounds of monitors containing toxic materials such as mercury. The investigation found that Zirkle and his co-defendant covered up the practice by submitting fraudulent documents to auditors and clients, and forged other documents when the practice was discovered.
Due to concerns over the pandemic, Judge Robart ordered Zirkle to begin serving his sentence in early August. Despite objections from the prosecutor, Zirkle requested that his sentence be postponed, so that he could attend two family weddings. Zirkle will be on 18 months of probation for tax offenses after his prison sentence.
The tax case was investigated by the FBI and the Internal Revenue Service Criminal Investigation (IRS:CI).
The case was prosecuted by Assistant United States Attorney Seth Wilkinson.