The once seemingly idyllic world of Washington businessman John W. Lyon, under siege from U.S. investigators and prosecutors for three years, now has come under direct attack with a federal grand jury indictment accusing him of skimming corporate funds for personal purposes and failing to pay income taxes on them.
The indictment announced Monday in Baltimore, which followed by one day the conviction of Lyon's construction firm and a key associate on a charge of giving an illegal gift to a former District of Columbia judge, came as no surprise. There were press reports of the tax investigation as far back as December 1979.
Several who know him in the Washington business community said the accusation seems out of character for a quiet, reserved and tough businessman who grew up in the poverty of the West Virginia mountains and seemingly made it big in the boom town that was the nation's capital in the decades following World War II.
"Growing up, he saw what lots of people did to get ahead in the past 50 years," said one who has dealt with him, and who declined the use of his name. "If he would talk to you, I suspect he would say, 'I am straight, I am correct in my dealings.' He has worked himself into a position where he has mentally justified himself. If he took a lie detector test, he would say he has done nothing wrong."
Several attempts to reach Lyon for comment about the indictment were unsuccessful.
Lyon is the president of Excavation Construction Inc., a Bladensburg trucking and construction firm of which he owns half, and is the president of Parking Management Inc., the city's largest parking garage service, which is controlled by developer Dominic F. Antonelli Jr.
The indictment returned in Baltimore charged that Lyon joined with the other half-owner of Excavation Construction, Larry A. Campbell, and two subordinates in diverting at least $82,000 from the firm for personal purposes of Lyon and Campbell, and that Lyon and Campbell failed to report the sum as taxable income. The money went, the indictment alleged, for such purposes as building a swimming pool and patio at Lyon's Potomac home, landscaping, maintenance of home air-conditioning and the rental of private hunting preserves.
The charges cover the years 1974 through 1977, but the indictment itself asserted that such unlawful acts began as early as September 1970 and continued until the end of 1979.
The indictment was returned just one day after the firm and half-owner Campbell were convicted by a U.S. District Court jury in Washington for giving an illegal $300 gift to former D.C. Superior Court judge Robert H. Campbell, who is not related. The former judge was acquitted of a more serious charge of accepting about $7,000 in bribes that prosecutors had alleged were given in return for dismissing tickets given to overweight Excavation Construction dump trucks.
The charges involving the former judge suggested that the firm may have sought to inflate its profits by overloading its trucks and avoiding costly penalties for doing so. The new indictment charges that Excavation Construction's parent firm avoided paying some of its corporate income tax by masking payments in behalf of Lyon and Larry Campbell as business expenses. Finally the indictment alleges that the two owners of the firm failed to report those payments as taxable income.
Lyon, despite his business attainments, has played a largely background role in local affairs. He served for several years as a director of the National Bank of Washington, the city's third-largest bank, but resigned last year when an internal investigation concluded that Excavation Construction had been granted favored treatments in obtaining loans and arranging repayments.
He served for three years on the board of directors of the Metropolitan Washington Board of Trade. R. Robert Linowes, an attorney who was board president during part of that time, called Lyon "quiet, reserved, always pleasant. . . In a large crowd, at a cocktail party or something, he would generally be standing off and not be a hale, hearty fellow."
Gilbert Violante, executive director of the Washington Parking Association, an industry trade group, described Lyon as "pretty much a self-made man, a very, very hard-working guy, always an early riser . . . very conscientious and family oriented."
In an era of longer hair and blow-dry styling, Lyon sticks to the crew cut of his youth. Said one who knows him: "He is lean, tall, mean, jut-jawed -- put a colonel's uniform and a green beret on him and you've got him."