Columbia, Missouri- A Columbia strip club owner has been convicted of tax evasion more than four years after law officers and revenue agents raided his business.
James Andrew Yeager, the 36-year-old owner of Club Vogue and JR Entertainment, pleaded guilty to underreporting his taxable income for 1999, 2000 and 2001 yesterday before U.S. District Judge Nanette K. Laughrey.
Yeager diverted money from his businesses for personal use without recording that money in the businesses’ books, U.S. Attorney Bradley J. Schlozman said in a news release.
Cash exchanges, such as Yeager’s cut of the lap dances his female employees gave, were falling through the accounting cracks, said Don Ledford, a Schlozman spokesman.
“The portion that they turned in was getting stuffed in an envelope and put behind the bar,” Ledford said. “It’s because so much of this was being done in cash that he was able to get away with it for a while.”
Federal authorities allege Yeager owes more than $177,000 in unpaid taxes. That includes $140,543 in tax owed on underreported income of $493,591 in the three years covered by the guilty plea, plus $36,732 authorities say he owes for unreported income in 2002.
In April 2002, officials searched Club Vogue, 912 E. Business Loop 70, and its sister strip club in Boonville, the now-defunct Show Girls, on a federal warrant. Federal and state investigators dug through documents for about four hours before leaving with cardboard boxes full of evidence.
Ledford declined to divulge how officials were tipped off to the diverted funds.
“I don’t think that I can go into the details of this investigation,” he said.
Yeager and Dan Bruce Marcum, a manager at Club Vogue and co-owner of Show Girls with Yeager, were indicted in April 2006.
Marcum is charged with failing to pay $40,611 in federal taxes. Schlozman said Marcum tried to conceal his income by accepting his pay in cash and by failing to file a federal income tax return in 1999. A trial is scheduled for Nov. 6.
Yeager and Marcum could not be reached this morning, and Yeager’s attorney, Clayton, Mo.-based N. Scott Rosenblum, did not respond to a message left with his secretary.
Under federal statutes, Yeager faces a sentence of up to 15 years in federal prison without parole, a fine up to $750,000 and an order of restitution. A sentencing hearing will be scheduled after a pre-sentence investigation.
Ledford said the nude dancers who gave Yeager the unreported income escaped the monetary mishap unscathed.
“None of them are charged,” he said.