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If losing other people’s money was a sport, George W. Taylor Jr. could win a trophy.
Last week, the Wilmington entrepreneur pleaded guilty to evading $2.2 million in taxes at one of his ventures as part of a plea agreement with the government. Federal prosecutors filed the criminal case against Taylor in June, alleging he withheld employment taxes at his sports car auto shop, National Speed, between 2014 and 2021.
Taylor spent his summer out of custody but had to surrender his passport last week.
“The vast majority of working Americans pay their fair share in taxes,” U.S. Attorney Michael Easley said in a release. “But for years this businessman took millions from employees’ paychecks, supposedly for taxes, and spent it to pad his business and personal expenses.”
The news, while eye-catching, isn’t entirely shocking. Taylor is experienced in owing money, but this time, his years of financial mismanagement may have finally caught up to him.
According to a review of court records not previously reported, Taylor had twice declared personal bankruptcy earlier for business-related failures in 2005 and 2012.
In 2003, Taylor reported earning nearly $1.3 million from a trading firm. The next year, Taylor collected unemployment. By 2005, a trading account with the same firm under Taylor’s management was more than $1 million in the negative (he never traded using his own money, he testified at the time). In the end, he paid the firm just $8,000 as part of the bankruptcy. The Internal Revenue Service initially asserted Taylor owed about $369,000 for the tax year 2000, but Taylor ended up paying $6,500.
His fall may have been painful, but at least he had a cushion: Taylor sold his properties, cars, Jet Skis, Rolex, and more, and moved with his wife and children into his parents’ home on Figure Eight Island—the area’s most expensive and exclusive beachfront community, per court filings.
Risky Business
Taylor had become an enigma in Wilmington.
He helped one of his sons in founding Next Glass, a beer-related software firm, which in 2016 acquired Untappd, a beer-review app previously headquartered in Wilmington. But Taylor’s polarizing reputation peaked after he founded a for-profit brewery, TRU Colors, in 2017.
TRU Colors employed active rival gang members as a path to economic empowerment and reduce street violence. Fans of Taylor’s bold vision commended him for stepping into an arena that others wouldn’t touch. Critics viewed his project as exploitative and reckless, or naive at best.
Some former employees were grateful for the opportunity, but others were put off by what they saw as a white savior complex. Despite the optics, Taylor did give jobs and training to people in a rough part of town who otherwise weren’t traditionally employable. Law enforcement leaders did not endorse his experiment, with many airing serious reservations about mixing rival gang members in the name of peace and unity.
Things erupted in July 2021 when a top-ranking gang member and brewery employee was murdered in the home of one of Taylor’s sons, who was a top brewery executive present but uninjured during the deadly incident. A 21-year-old woman, Bri-Yanna Williams, was also killed and another young woman was shot but survived.
The brutal nature of the double homicide and its location—an upper-class predominantly white neighborhood—spurred feverish interest, from the public and the media, in Taylor’s next steps. Days after her murder, Williams’ family blamed Taylor in a WECT interview; Taylor later claimed the interview bordered on slander.
The New Yorker published an 8,200-word dive into Taylor and TRU Colors in August 2022. A week later, Taylor announced the brewery would close, and all 62 employees were out of jobs with just two days’ notice, with their company equity worthless.
“I have spent my career in startups, pursuing risky ideas that I thought would matter,” Taylor wrote in a letter announcing the closure. “In doing so, I have risked everything and succeeded and also risked everything and failed. Every failure hurt, but TRU Colors is different and tragic on many levels.”
Before a sold-out audience of hundreds in December 2022, Taylor gave a TED Talks-style address at Greater Wilmington Business Journal’s Power Breakfast event.
In a segment titled “Lessons Learned,” Taylor blamed the pandemic, a hurricane, and media coverage for his business failure. He said he had burned through nearly $3 million in unplanned spending in seven months and the New Yorker story spooked investors who he had hoped would offer the business a life raft.
After months of reflection, Taylor offered few tangible business lessons for his audience. He encouraged them to be skeptical of the media and not support publishers that trade integrity for “clicks and dollars.” He claimed a WECT report wasn’t true when it in fact was, and in a PowerPoint slide that featured outlets he felt led to the company’s demise, he included a cartoon gremlin using a laptop. The author of The New Yorker piece, Charles Bethea, told WHQR that he was in contact with Taylor for over a year and “he appears to have kept that knowledge from some of his investors.”
While Taylor acknowledged he let investors down in his speech, his post-mortem lacked any clear-eyed reflections of his accountability for the business failure.
The speech was the last time Taylor has spoken publicly; he did not respond to a request to comment.
PNC Bank made a $6 million equity investment and awarded a $3.25 million credit line to TRU Colors in 2022. Molson Coors announced a strategic partnership with the brewery in 2021 and bought an undisclosed stake. Neither company responded to address whether either was aware of Taylor’s prior bankruptcies.
TRU Colors’ former marketing director Chaz Springer has no hard feelings.
“George isn’t perfect and was very transparent about a lot to us,” he said in a statement. “I’ll always be grateful for everything he did.”
Springer said Taylor gave him something worth more than company equity–“He gave me an opportunity!”
Déjà Vu
Taylor’s handling of TRU Colors’ implosion is reminiscent of another business dispute he had a decade prior. In both fallouts, Taylor deflected blame as his cash evaporated.
In 2011, Jerry Godwin loaned Taylor $400,000 in a one-year promissory note to support Taylor’s business, National Speed. Days before the note expired, Taylor asked for a three-month extension in two lengthy emails promising he was good for the money, and blamed missed revenue targets and an employee with an alcohol problem. “Our company is often on the edge as we fight for success and things sometimes move fast without consideration,” he wrote. “I just didn’t see it coming.”
Godwin permitted the extension, and Taylor defaulted. Godwin sued Taylor and the business entities, alleging Taylor knowingly misled Godwin.
Two days before a judge ruled in Godwin’s favor, Taylor shifted all of National Speed’s assets to a differently named LLC which he did not control. The business had $5 million in outstanding loans and a negative net value.
In a nine-page letter to shareholders of National Speed and its sister company, Momentum Performance, Taylor blamed a “hostile and aggressive” investor—Godwin—for preventing him from raising necessary outside capital, and warned them the business was on the brink of collapse. He asked the investors to approve the business transfer, fork over more cash, and included two promotional DVDs to showcase the great things happening at the company.
Godwin sued Taylor again, this time alleging a fraudulent business transfer to conceal assets.
Taylor filed for Chapter 7 bankruptcy a month later—a case where Godwin intervened. Taylor’s “conduct clearly illustrates a pattern…[of] desperate and fraudulent actions,” Godwin’s complaint states. Taylor reported having about $900,000 in liabilities at the time, with the judgment being his largest obligation.
Taylor denied parts of Godwin’s claims, but the two entered a settlement agreement in 2013. Godwin declined to comment.
Somehow, Taylor’s company survived the ordeal, but as we now know, he started withholding taxes in 2016. National Speed completed 1,215 jobs last year, the shop posted to social media in January. The company hasn’t posted since February, and a call to the shop Wednesday morning went unanswered.
Failure to pay employment taxes can lead to employees’ lost or delayed Social Security and Medicare benefits, according to the Internal Revenue Service’s Criminal Investigation unit.
In November, Taylor could be sentenced to up to five years in prison.
If so, he will have ample time to reflect on what went wrong this time around.
Johanna F. Still is The Assembly‘s Wilmington editor. She previously covered economic development for Greater Wilmington Business Journal and was the assistant editor at Port City Daily. She can be reached at johanna@theassemblync.com.