Getting Away with Nothing


An employer is required to submit payroll taxes for each employee. If they hold money from an employee’s paycheck, but don’t pay the correct portion to the government, payroll fraud occurs. An article published by reports that the owners of a construction and excavation company bilked the government out of more than $200,000 in payroll taxes.

The story states that over approximately three years, one of the owners kept track of employee hours in a book he carried with him. After turning over this information to his business partner and brother, employees would then be paid in cash, by check or both. During this time it was alleged that the pair under-reported gross wages and neglected to record payments to their employees in company records.

Tax filings to the Internal Revenue Service (IRS) show that the company fell short by several thousand dollars at each quarterly filing. (Gee, I wonder where all of that money went.)

The brothers struck a plea deal and were each sentenced to 21 months in federal prison. They also will pay a fine and will have to pay back the unreported taxes. (Well, that certainly sounds fair.)

In this case, payroll fraud was pretty easy to carry out because the bookkeeping duties were handled by the owners. (Perhaps they used the extra money to keep the business afloat during tough times or maybe they were pocketing the extra cash and spending it on personal items. We can only guess.) It looks like these two didn’t get away with anything. Let’s hope that they understand it would have been easier to pay their taxes in the first place, instead of trying to get away with bilking the government and underpaying their employees.

Source: Today’s ”Fraud of the Day” is based on an article titled, ”Owners of Canfield Company Sentenced in Tax Fraud Case,” published by on September 5, 2014.

CLEVELAND, Ohio (WKBN) – The owners of a Canfield construction company were sentenced in federal court Thursday for defrauding the IRS out of thousands in payroll taxes.

Scott and David Bonamase, owner and operator of ABC (A. Bonamase Contracting) were sentenced to 21 months in federal prison for bilking the government out of over $200,000 in taxes.

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Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.