LUBBOCK, TX (KCBD) - A former business owner admits in Lubbock federal court that he concealed a crime. Mike Wooten, 48, pleaded guilty to Misprision of a Felony; signing off on the charges July 16th and then appearing Thursday afternoon in person before the judge. Wooten admitted in court documents that he intentionally under reported the taxable sales of his business WTL (West Texas Lighting) to state officials. WTL paid taxes on $1,501,713.21 of gross sales from September 2005 through June 2009. An audit after the fact determined that WTL should have paid taxes on $7,327,932.70.
But at the very same time Wooten admits doing the exact opposite when reporting WTL sales figures to a company called Diversified Lenders. Wooten would turn over an exaggerated account of WTL's bills to Diversified to act as a collection agency. Diversified then collected in some cases on bills that were too high, or in other cases bills for work that was never done.
Diversified was paying WTL approximately 80% up front for bills that went to collection and court records say "The purpose of this scheme was to defraud Diversified Lenders of its money and property."
In his plea agreement, it says losses caused by his crime are more than $120,000 but less than $200,000. KCBD NewsChannel 11 has learned that this amount is from unpaid taxes and not losses to Diversified.
WLT is no longer in business. Wooten will be sentenced at a later date to no more than three years in federal prison. For now he remains free on personal recognizance.
He chose not to answer questions after his court appearance.
This is not Wooten's first brush with the law. He was investigated in the late 1990's for possibly working with Linda Medlar Jones to improperly influence HUD Secretary Henry Cisneros during the bidding process for a HUD contract. Special prosecutors wrote in their official report that evidence suggested Wooten's actions were improper. However, they did not believe they could prove the allegations beyond all reasonable doubt and so Wooten was never charged.
(Updated to reflect new information about the nature of the losses listed in Wooten's plea agreement.)