Widgets Magazine
  • Former TEEMCO CEO sentenced to five years in prison

    A federal judge handed down a 5-year prison sentence Thursday to Greg Lorson, the former CEO of Edmond-based TEEMCO, as punishment for a $3.5 million tax embezzlement scheme.

    Prosecutors claim Lorson lived lavishly on money owed the government

    The sentence exceeded guidelines for similar crimes. The judge and U.S. Attorney cited Lorson's long criminal history and other exacerbating factors such as the harm caused to TEEMCO employees, the lack of filing of a personal tax return since 1990 and an unpaid Internal Revenue Service (IRS) judgment regarding a similar issue in his immediately preceding job.

    Last June, Lorson pleaded guilty to taking $3,003,220 that was owed to IRS and another $542,162 due to the state of Oklahoma, sums deducted from employee paychecks which law dictates must be held in trust for the government. Much of that money was spent on items such as a limousine, yacht, a resort condominium and international travel. Bank records show Lorson frequently made large cash withdrawals from company accounts.

    Lorson also spent large sums on a failed plan to purchase, renovate and occupy the historic Gold Dome building at NW 23rd and Classen. After the company covered the iconic structure in flat paint and installed their sign, OKCTalk was first to report that all work had stopped and the property had never actually transferred hands. Ultimately, TEEMCO sold off expensive items acquired for the ostensible new headquarters at a clearance sale from a storge unit, including what was proclaimed as the world's largest salt crystal lamp.

    From TEEMCO's inception in 2010 until the state tax commission forcibly closed its doors in 2015, Lorson admitted to directly instructing TEEMCO staff to not file quarterly returns, a period spanning 20 consecutive quarters. Under Section 7202 of the Internal Revenue Code, a willful failure to pay over withholding tax is a felony.

    In a 14-page document filed with the court, the prosecuting U.S. attorney argued for a long period of incarceration.

    “Undeterred by five prior convictions and an earlier 70-month stint in federal prison, Mr. Lorson is now caught in his largest financial fraud case yet—a $3.5 million tax scheme where he used as his personal piggybank a failed environmental services company,” the U.S. attorney wrote.

    The document also cites “the particularly egregious harms to TEEMCO employees and clients” and that “Mr. Lorson's fraudulent conduct here can only plausibly be explained by greed, an exorbitant personal lifestyle, and a deliberate decision to play by a different set of rules.”

    It goes on to note “concerns about Mr. Lorson's current business practices, possible discrepancies in his responses to the Probation Office, and the persistent challenges in getting basic financial records about his current business.”

    Lorson previously reported to the court that he was running a construction company in Florida and research reveals several complaints to the Better Business Bureau regarding shoddy and unfinished work.

    Court records show Lorson spent thousands one evening at Boujis, a London nightclub

    Before sentencing, Lorson was given the opportunity to address the judge and asserted that the tax obligations “came out of nowhere” and that he was spending in an attempt to expand TEEMCO with the specific goal of repaying an ever-growing mountain of taxes. He further claimed a high personal price, describing a near-homeless situation in the immediate aftermath of TEEMCO's collapse.

    Judge Joe Heaton was not persuaded, declaring that the full body of evidence clearly demonstrated Lorson knew exactly what was expected by law, that he had never made any attempt to repay previous tax obligations and that he knowingly conducted a deliberate plan to defraud the government.

    The judge noted that the embezzlement started from the very inception of TEEMCO and continued unabated throughout its entire corporate existence. Particularly damning was evidence that TEEMCO employees had tried to submit at least some of the taxes owed – having drawn cashier's checks for that purpose – before Lorson stepped in and ordered the funds be redeposited into the company account.

    Before announcing the final sentence, Judge Heaton explained that it was rare to exceed the sentencing guidelines but the evidence and circumstances in Lorson's case warranted an upward variance.

    At a time when TEEMCO and local media outlets where portraying the company as a healthy, successful business, OKCTalk was first to report on serious issues, starting in 2014. A second article quickly followed (this is the eighth story in a series) and outlined the tax embezzlement in detail, as well as accurately reporting the dollar figures several years before charges were formally filed.

    Lorson continued his tax theft for another year before the company was shuttered and ultimately dissolved amid a flurry of evictions and judgments totaling over $800,000, not including the millions in tax obligations. In reviewing court documents and interviewing former employees and numerous creditors, OKCTalk identified at least an additional $5 million in unpaid bills, including extravagant sponsorship deals with Oklahoma City Thunder, University of Oklahoma and Oklahoma State University.

    In total, Lorson used TEEMCO to defraud the government, employees, clients and businesses of in excess of $10 million.

    Lorson was ordered by the court to report to federal prison by 1 PM on March 1st. The Federal Bureau of Prisons will determine the specific facility.

    At the end of his incarceration, Lorson will be under supervised release for three additional years. Due to his long history of committing various forms of business fraud, the judge also stipulated that before Lorson could form a new business entity or revive an existing one, prior court approval would be required.

    Although the judge acknowledged significant restitution was unlikely, Lorson is required to reimburse the millions owed the government, an obligation that cannot be discharged through bankruptcy or any other means.

    Previous stories

    Exclusive Report: Troubled times at TEEMCO

    TEEMCO implicated in massive tax evasion scheme

    TEEMCO being sued for Channel 9 debt, facing evictions

    TEEMCO closed by the State Tax Commission

    TEEMCO evicted from headquarters

    TEEMCO CEO under criminal investigation, files for bankruptcy

    Former TEEMCO CEO enters guilty plea to felony tax charges

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