The vice president of a Beltsville water and sewer lines company pleaded guilty yesterday to giving false information on his 1980 Maryland income tax return and was sentenced to a year in jail with all but 30 days suspended.
Lee Ganey Jr., 45, vice president of Tri-County Utilities, was also ordered by Prince George's County Circuit Court Judge Robert J. Woods to perform 200 hours of community service and file amended corporate and personal tax returns.
According to prosecutors, Ganey underreported his personal income by a total of $50,000 on 1979 and 1980 tax returns, and had understated corporate income by a total of $100,000 in 1979, 1980 and 1981. He was originally charged with seven counts of tax violation; prosecutors yesterday dropped all but the one to which he pleaded guilty.
Ganey, a New Carrollton resident, was the second Tri-County Utilities officer sentenced on state tax-evasion charges in a week. On April 16, Tri-County Utilities President Frank Hauser pleaded guilty to the same charge, a misdemeanor, and received an identical sentence.
The two tax cases stem from a continuing 20-month investigation by the Maryland state attorney general's office that was prompted by a series of articles in The Washington Post.
The stories detailed charges of bid-rigging and price-fixing among sewer and water contractors working for the Washington Suburban Sanitary Commission, the public agency that builds and maintains sewer and water lines in Montgomery and Prince George's counties.
According to prosecutor Joseph L. Evans, Hauser and Ganey set up a secret bank account at Citizens Bank and Trust in March 1980 and, over a 14-month period, deposited more than $66,000 in unreported income.
"They would receive checks payable to Tri-County, deposit them in the secret account, and then draw money out," Evans said.
Evans said Hauser and Ganey also failed to report income earned from leasing equipment and providing various services to other sewer and water contractors. Marvin F. Bosley and Otha D. Upchurch, officers of Suburban Utilities Contractors Inc., have also been charged with tax violations as a result of the investigation.