Tuesday, January 13, 2015

Missouri Man Sentenced For Embezzling Nearly $3 Million In Payroll Scheme

From eMissourian.com on 1/10/2015:

A Franklin County man who formerly operated a payroll services company in St. Louis County has been sentenced to more than four years in prison and ordered to pay more than $3 million in restitution for stealing from clients.

Bradley Ferguson, 48, Washington, was sentenced Wednesday by U.S. District Judge E. Richard Webber to 54 months in prison on federal mail fraud and money laundering charges. He pleaded guilty in August to the two felony charges in the case.

Defendants in federal criminal cases typically serve 85 percent of their sentence.

Judge Webber also ordered Ferguson to pay $3,067,137 in restitution to former clients, according to the U.S. attorney’s office.

Ferguson was facing a maximum 20-year sentence for mail fraud and five years for money laundering.

Ferguson owned Fenton-based Paymaster Business Solutions Inc. He is accused of withdrawing money from the bank accounts of business clients to pay federal, state and local taxes but did not make the payments.

He then withdrew more than $2.7 million from client accounts in 2013 in an attempt to cover the tax payments after IRS inquiries.

The U.S. attorney’s office said Ferguson’s clients included churches, youth organizations, child daycare facilities, law firms, and other businesses.

According to an indictment handed up by a federal grand jury, from January 2005 through January 2014, Ferguson drafted funds directly from Paymaster business clients’ bank accounts in order to pay their federal, state, and local tax liabilities. However, Paymaster, at Ferguson’s direction, failed to forward the Paymaster business clients’ funds to the taxing authorities in order to pay their tax liabilities.

Paymaster drafted in excess of $2,700,000 from Paymaster business clients’ bank accounts to pay clients’ federal, state, and local tax liabilities, as well as FICA liabilities, for the period July 2013 through December 2013, but were not forwarded to the proper taxing authorities, the indictment alleged.

Additionally, the indictment alleged that Ferguson, as power of attorney for Paymaster business clients, was contacted directly by the IRS and questioned as to the failure to pay clients’ federal tax liabilities. Ferguson did not tell his clients about the IRS inquiries. When clients occasionally learned that Paymaster had not forwarded their funds to the taxing authorities, Ferguson lied to them and told them Paymaster had made the payments, according to the indictment.

Finally, the indictment states that in December 2013, Ferguson retained the services of a commercial shredding company and directed that the Paymaster business client records be shredded and removed from the Paymaster offices.


Read the whole story here.

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