Exclusive: Police say illegal business ripping off city for thousands

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by Maggie Crane / News 4

KMOV.com

Posted on July 19, 2012 at 9:51 PM

Updated Thursday, Dec 5 at 6:00 AM

3419 Gratiot St

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ST. LOUIS (KMOV.com) -- Police discover an illegal business operating in the city, ripping off St. Louis for thousands of dollars.  Police say the illegal scrap metal dealer was leading to a spike in crime.

Behind the dock doors at GenX in an industrial park in Midtown St. Louis is a stockpile of scrap metal.  According to a flier advertising GenX, the company buys everything from cans to copper.

Copper thefts had dropped dramatically -- 70 percent—in the city after a new ordinance passed, but when police noticed a spike in air conditioning thefts, they started looking for the company police call an illegal buyer.

During Thursday’s raid inside GenX Scrap Metal Recycling, police discovered mountains of scrap metal and air conditioning coils they say someone had likely stolen in order to sell.  Police also got word GenX paid cash for copper, which has been illegal since a new ordinance took effect in January.

“We found out that they didn’t even have a business license or an occupancy permit,” St. Louis Metropolitan Police Detective Mark Rodebaugh said.  “There’s a lot of vacant properties in the city, a lot of buildings in the city, and if somebody didn’t bring it to our attention, they probably still would have been operating today.”

All the while, mega money was flowing into the illegal business undetected.

“We found out that this business has done about $1.8 million since March First until today,” Det. Rodebaugh said.

That means the company didn’t pay a dime in taxes.

“No money in taxes,” Det. Rodebaugh said.  “They’re not on file anywhere.  The city doesn’t even know they’re there, so how can they be taxed on this money they’re making?”

Police say their undercover detective sold copper to GenX right at their loading dock but that the employee gave him a receipt saying he had bought cheap brass, not expensive copper.

“We believe that a lot of places are putting brass down to throw off authorities saying they’re not buying copper but they’re buying brass,” Det. Rodebaugh said.

Police say metal thefts, especially copper, accounts for a $6 Million loss to home and property owners throughout the city of St. Louis every year.  Police say the vast majority of thieves are stealing and selling the scrap for quick cash to feed their heroin habits.  They say by forcing scrap dealers to pay by check instead of cash, they’ve been successful at slowing down the amount of scrap thefts happening in the city.  Police say to consider the raid on GenX a warning.

“We’re going to be paying visits to these scrap yards, letting them know that if they’re not playing by the rules, they are going to be shut down,” det. Rodebaugh said.  “They are going to be run out of the city of St. Louis.”

 

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