Former boss of US payroll processing firm given six years for fraud
The multi-million dollar scam funded an affluent lifestyle.
The former owner of a US payroll-processing company who ran a multi-million
dollar fraud scheme through the firm has been sentenced to nearly six years in
John Scholtz, who ran Innovative Payroll Services LLC, was not only given a 66-
month sentence and two years of supervised release, but was also ordered to pay
more than $9.6 million in restitution. He pleaded guilty in March to wire fraud
and transacting in criminal proceeds following an FBI investigation.
From February 2012 to January 2016, Scholtz or members of his staff withdrew
funds from bank accounts, into which customers deposited money to pay for
their payroll taxes. He then used the money to fund operating and personal
expenses, which included payments for homes, cars and boats.
The scheme reportedly lost 103 clients based in New Jersey and elsewhere $8.4
million worth of federal, state and local tax deposits, along with $578,000 in
penalties and interest.