Frank Amodeo, the former leader of Mirabilis Ventures Inc., pleaded guilty Tuesday to charges stemming from what prosecutors called a $181 million payroll tax fraud that could’ve landed Amodeo in prison for the rest of his life.
The above is a quote from a Tampa Bay Business Journal article titled Mirabilis Chief Amadeo Pleads Guilty in $181M Tax Fraud Scheme.
Amodeo admitted to conspiracy to commit wire fraud, obstruction of an agency proceeding, impeding the Internal Revenue Service in the assessment and collection of taxes, failure to remit payroll taxes, and obstruction of an agency proceeding. He could still face up to 25 years imprisonment, a $1.25 million fine, and three years supervised release, according to U.S. Attorney Robert E. O’Neill’s office.
According to the indictment Amodeo, during a three year period beginning in 2004, controlled Sunshine Companies, Staff Leasing and Professional Benefit Solutions and intentionally and willfully failed to remit to the IRS monies that were withheld from employees wages. The companies were in the business of leasing employees to other businesses.
Maybe Keith Fogg, Professor of Tax Law at Villanova University, who recently wrote a scholarly article on why the IRC § 6672 (trust fund) penalty is an insufficient device for the collection of unpaid payroll taxes, has a point after all.
See my blog post about Mr. Fogg’s article at Tax Policy Professor Says Payroll Tax Trust Fund Penalty Too Lenient.
1 response so far ↓
1 Dan // Jul 13, 2011 at 10:50 am
Companies have to understand that the payroll is the largest expense area for many organizations, and one which should be monitored carefully. Payroll fraud accounts for 17% of all fraudulent disbursements suffered by organizations. Uncovering the fraudulent transaction and, subsequently, proving the payroll fraud can be difficult because of the dollar magnitude and volume of transactions involved. An outside payroll service provider does not protect your organization from payroll fraud.
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