Owner of former Harrisburg payroll company arrested in connection with alleged $5.7 million theft
HARRISBURG — Pennsylvania Attorney General Kathleen G. Kane’s office today announced the arrest of a Dauphin County man charged in connection with the alleged theft of $5.7 million from clients of his former payroll service company.
William Simon Sullivan Jr., 42, was charged today with numerous felony criminal offenses following an intensive investigation by the Office of Attorney General’s Bureau of Criminal Investigations and the state Department of Revenue, Bureau of Criminal Tax Investigations.
According to a criminal complaint, Sullivan was the owner and operator of a company known as Net Pay Solutions, Inc., a payroll service that is no longer in business. Prior to a bankruptcy filing, the company at one time handled payroll processing, as well as the payment of federal, state and local taxes for more than 200 businesses located throughout the country.
It is alleged that Sullivan, as the business’ chief executive, used funds that were allocated solely to pay his clients’ taxes to instead pay his company’s operating expenses and financial obligations. He also is accused of using client funds to cover personal spending on vehicles, travel and home renovations, investigators allege in a criminal complaint.
Sullivan also allegedly made false entries in payroll accounting software to make it appear as though money was being used for legitimate payroll and business expenses, when investigators allege he was in fact concealing theft and covering the losses of his company. As part of this alleged scheme, Sullivan also allegedly sent emails and documentation to clients who believed their tax payments were paid or pending.
It is further alleged that Sullivan used money from new clients to pay other clients’ existing unpaid tax liabilities as his business began to falter.
Sullivan, 913 South Progress Ave., Harrisburg, is charged with one count each of theft by unlawful taking or disposition, theft by deception, theft by failure to make required disposition of funds and access device fraud.
He appeared today for a preliminary arraignment. Bail was set at $150,000. A preliminary hearing is scheduled for June 23.
Attorney General Kane thanked the state Department of Revenue, Bureau of Criminal Tax Investigations for its work on this investigation.
This case will be prosecuted by Senior Deputy Attorney General George R. Zaiser of the Office of Attorney General’s Tax Crime Unit.
SOURCE: Pa Attorney General’s Office