Thursday, March 28, 2013
IRS Probes OXYwater Founders
Two local entrepreneurs who came up with an oxygen-enhanced water that landed a NASCAR sponsorship are in trouble with the Internal Revenue Service. The IRS is investigating Preston J. Harrison, a former Ohio State University football player, and Thomas E. Jackson Jr., founders of a Westerville business that makes and distributes OXYwater. Its website says that OXYwater is “packed with electrolytes and other natural elements that boost energy levels and endurance.”
An affidavit filed in U.S. District Court in Columbus says that IRS agents recently seized a 2009 Cadillac, a 2009 BMW and a bank account as part of an investigation into the financial dealings of Imperial Integrated Health Research and Development at 470 Olde Worthington Rd., Suite 200.
Harrison and Jackson are the founders of Imperial Integrated. The allegation is that they funneled investors’ money into their personal bank accounts and into another company.
As of yesterday, no charges had been filed. Possible charges, according to the affidavit, are wire fraud and money laundering.
The affidavit says that Harrison, 41, of 3071 Willow Springs Court, Lewis Center, and Jackson, whose address and age were unavailable, borrowed $5 million from more than 10 people and one company to produce OXYwater beginning in 2011. The investors included several professional basketball players in Europe.
A year later, the court record says, several investors became worried about where their money was going and hired a lawyer. That attorney, who is not named in the affidavit, supposedly learned that the company’s tax returns grossly underestimated the amount investors had paid into the company.
Harrison and Jackson diverted at least $1.2 million in investors’ money into a bank account that Harrison controlled for another company, Forever Now, according to IRS investigators. That money was used to buy the Cadillac, the BMW, a new backyard patio, a swimming pool, expensive jewelry, home furnishings and home improvements, the affidavit says.
Attempts to reach Harrison and Jackson by phone and email were unsuccessful yesterday.
A woman at OXYwater’s distribution center at 8273 N. Green Meadows Dr., Lewis Center, said that Harrison and Jackson could be reached at the company corporate headquarters, but no one answered the phone at that location, and a recording said the memory on the message machine was full.
The IRS probe began before the investors raised questions, he said, but he didn’t know what started it. OXYwater is sold at Walgreens, Meijer and other stores, according to its website.
This month, a three-year sponsorship agreement between NASCAR’s FAS Lane Racing team and OXYwater was announced. FAS Lane’s No. 32 Ford Fusion in NASCAR’s Sprint Cup Series sports the company’s name. Terry Labonte, Ken Schrader and Timmy Hill alternate as drivers.
- via The Columbus Dispatch