An Allen County business owner will have to pay hundreds of thousands of dollars in restitution after admitting in court to evading taxes owed by his company.

John Paul Cates, 50, pleaded guilty Thursday in U.S. District Court in Bowling Green to a single count of tax evasion.

Cates had been indicted on the charge in 2021 by a federal grand jury and his case was scheduled to go to trial later this month.

According to federal court records, the criminal charge against Cates stemmed from his management of Trinity Steel Works, a Scottsville-based company.

The plea agreement in the case filed Thursday said that Cates willfully attempted to evade the payment of employment taxes owed by Trinity Steel Works from the second financial quarter of 2014 through the second financial quarter of 2017, with the exception of the first quarter of 2015.

Federal prosecutors said that Cates committed multiple acts in an effort to avoid paying the taxes.

Those efforts included the creation of two other corporations, Cates Cattle Company LLC and TSW Fabrication Inc., and placing them in the names of other people to conceal his control over them, as well as the use of bank accounts in the name of Cates Cattle Company to transfer funds out of Trinity Steel Works and TSW Fabrication, while still maintaining control of the funds, court records show.

Cates faced penalties of up to five years in prison and a $250,000 fine if he had been convicted at trial.

Instead, federal prosecutors will recommend that Cates serve one year and one day in prison and pay $811,312.14 in restitution to the federal government by the time of his sentencing, which U.S. District Court Chief Judge Greg Stivers set for April 18.

Cates is ordered by the plea agreement to file a financial disclosure and to not transfer or sell any property valued at $5,000 or more without first advising the government at least 10 days before the proposed sale or transfer.

The case was investigated by the IRS Criminal Investigations branch.