Operators Of Jacksonville Roofing Business Plead Guilty To Payroll Tax Fraud And Workers’ Compensation Fraud
Two brothers who owned a roofing business in Jacksonville, Florida have pleaded guilty to conspiracy to commit mail and wire fraud and conspiracy to commit tax fraud. Travis Morgan Slaughter and Tripp Charles Slaughter face up to 20 years in prison for their elaborate scheme to cheat the government and their employees.
The Scam:
The Slaughters operated their roofing business under a series of different names, but the scam remained the same. They used a complex system of “split checks” to avoid paying payroll taxes, defrauding the IRS of millions of dollars. They also underreported their payroll to avoid paying workers’ compensation insurance premiums.
According to their plea agreements, since 2007 the Slaughters have operated a roofing business in Jacksonville, first under the name Great White Construction, then under the name Florida Roofing Experts, and finally under the name 5 Star Roofing Services. Although the names changed, each business operated in the same manner, banked at the same financial institutions, and employed the same employees.
The company contracted with professional employer organizations (PEOs) to prepare payroll checks for employees, after making deductions for payroll taxes, and to file payroll tax returns and forward tax payments to governmental authorities. However, the company did not provide the PEOs with information about all the hours worked by, or all the wages due to, its employees. Instead, the company also paid the employees directly, with separate checks drawn on company bank accounts, and did not deduct payroll taxes from these checks. By paying employees with “split checks”—one from the PEO and one from the company—the company avoided paying the full amount of payroll taxes due to the Internal Revenue Service (IRS).
The Cost:
- Unpaid Payroll Taxes: Over $2.7 million
- Unpaid Workers’ Compensation Premiums: Over $2.7 million
- Unreported Personal Income Tax: Travis Slaughter owes over $2.4 million, Tripp Slaughter owes over $263,000
Justice is Served:
The brothers have agreed to forfeit millions of dollars in assets and pay restitution to the IRS and the workers’ compensation insurers. A sentencing date has not yet been set.
This case highlights the importance of holding businesses accountable for their actions and ensuring that they pay their fair share of taxes.
