Owner of the payroll services companies Shuttered MyPayrollHR and
ValueWise ordered to pay more than $ 100 million in restitution to victims
Michael Mann sentenced to 8 to 24 years in state prison for scheme that
Thousands of employers defrauded in New York and across the country
NEW YORK – New York Attorney General Letitia James and New York State Police Superintendent Kevin Bruen today announced the sentencing of Michael T. Mann (51, of Northville) for laundering more than $ 1 billion in stolen funds from employers, employees, financial institutions and finance companies between 2016 and 2019. In those three years, Mann embezzled tens of millions of dollars of payroll funds he held on behalf of client-employers to pay their employees’ paychecks and taxes, ultimately leaving thousands of employees in New York and across the country. in financial difficulty. Mann was sentenced today, before the Honorable James A. Murphy, III in Saratoga County Court – for his guilty plea to first degree money laundering, a Class B felony – at age 8 to 24 state prison.
“In just a few years, Michael Mann has laundered more than $ 1 billion on the backs of thousands of employees and businesses in New York City and across the country,” said Attorney General James. “While his illegal and heartless Ponzi scheme has devastated his innocent victims, let this man’s sentence serve as a warning that this kind of mass deception and fraud will not be tolerated. My office remains committed to holding accountable anyone who avidly exploits New Yorkers and wreaks financial havoc for their personal gain. I thank the state police for their partnership to hold this criminal accountable. “
“Michael Mann has set up a fraudulent scheme that has had a terrible impact on hundreds of small businesses and thousands of employees across the country,” said State Police Commissioner Bruen. “I want to thank our members and commend the Attorney General and his office for holding Michael Mann accountable for his actions.”
Today’s conviction is the result of a year-long investigation by the OAG in conjunction with New York State Police, with assistance from the New York State Department of Labor and from the New York State Department of Financial Services. The joint investigation – titled “Operation: ValueWise, Dollar Foolish” – found that Mann had engaged in a sophisticated money laundering scheme over the past three years to defraud employers, employees, financial institutions and finance companies over tens of millions of dollars.
Mann owned or operated over a dozen entities, including payroll service companies – such as ValueWise Corporation and MyPayrollHR.com, LLC – which were primarily based in Clifton Park, Saratoga County, Arizona. New York State. Mann admitted during his plea that – from at least January 2016 to September 2019 – he laundered money embezzled from these payroll companies by embezzling the stolen money through numerous business accounts he controlled. He committed this fraud in an attempt to repay millions of dollars in fraudulently obtained loans and in an attempt to continue defrauding employers, financial institutions and finance companies by stealing additional funds.
In September 2019, one of Mann’s banks became suspicious and froze a number of his accounts, ultimately exposing his fraudulent conduct. Hundreds of companies that have outsourced their payroll to Mann’s entities, along with thousands of employees, have been left behind. As a result, some companies have been forced to shut down. In August 2019, more than 800 employers paid more than $ 28 million in payroll that Mann embezzled for his own benefit. This money was intended for employees, including those working in ambulance corps, health care providers, religious institutions, preschools, restaurants and hotels.
The OAG alleged that Mann laundered more than $ 1 billion in the month before his scheme collapsed and admitted to similar behavior dating back to January 2016. An audit of more than 35 accounts controlled by Mann has revealed that he had made hundreds of transactions on a near-daily basis in order to move stolen funds through shell companies – in addition to the legitimate or quasi-legitimate businesses he was running – in order to continue his criminal activity and fraudulently obtaining millions of dollars from employers, financial institutions and corporate finance. Several so-called “shell companies” have provided Mann with a vehicle for business transactions without having significant legitimate assets or operations. Storage companies are created and left without commercial activity, and then used later without the need for overheads or the creation of a new company.
Mann’s conviction and conviction resolves other crimes uncovered by the OAG’s investigation for which he may have been charged, including Grand Larceny, Falsifying Business Records, and Scheme to Defraud, related to Mann’s role as owner and operator from various companies including: ValueWise Corporation d / b / a Apogee, d / b / a Optix Consulting, d / b / a Primacy Search Group and d / b / a Lincoln Academy; MyPayrollHR, LLC a / k / a MyPayrollHR.com LLC; Cloud Payroll, LLC; Pro Data Payroll Services, Inc .; Southwest Payroll Service, Inc .; Ross Personnel Consultants, Inc .; Weitz & Associates, Inc .; Viverant, LLC; Kaningo, LLC; Hire Flux Holdings, LLC; TrueConsulting Corp. ; TrueHR, LLC; Create Force, LLC; Funds still alive; Heutmaker Business Advisors, LLC; and Groupe FocalPointe, LLC. These offenses include:
- Steal payroll funds held in trusts for client employers in order to fraudulently inflate company assets and refund stolen funds to other clients,
- Providing materially false information and / or concealed material information in order to obtain millions of dollars in trade finance,
- Providing fictitious invoices to financial institutions to fraudulently inflate collateral assets of its entities and refund stolen funds to employer clients, and
- Falsely withholding millions of dollars from at least two Automated Clearing Houses (ACHs) by redirecting ACH payments to accounts controlled by Mann.
The OAG would like to thank the New York State Police and their Financial Crimes Unit for their invaluable assistance in investigating this matter. The OAG also thanks the New York State Department of Labor and the Department of Financial Services for their assistance in this matter.
This case was pursued under the initiative of Attorney General James Combatting Upstate Financial Frauds and Schemes (CUFFS), led by Director Philip V. Apruzzese, Deputy Attorney General in the Criminal Enforcement and Financial Crimes Bureau. The CUFFS initiative was implemented by Attorney General James with the aim of assisting local law enforcement and district attorney offices to investigate and prosecute complex financial crimes and money laundering cases. silver.
Assistant Attorneys General Apruzzese and John R. Healy continued the case, with help from legal support analysts Jamirah Williams-Johnson, Lyncee Stroman and Ivan Ramirez and supervising analyst Paul Strocko. Forensic accounting was carried out by Chief Auditor Meaghan E. Scotellaro, under the supervision of Chief Auditor Kristen Fabbri and Deputy Chief Auditor Sandy Bizzarro of the Forensic Audit Section. The Anti-Fraud and Financial Crime Office is headed by Office Manager Stephanie Swenton and Deputy Office Manager Joseph D’Arrigo.
The OAG investigation was led by Detective Mark J. Terra, under the supervision of Supervisory Detective Mark Spencer, Executive Agent Mario Rivera and Commander Antoine Karam of the Major Investigations Unit. The Bureau of Investigations is headed by Chief Investigator Oliver Pu-Folkes and Senior Deputy Chief Investigator John Reidy. The Bureau of Criminal Law Enforcement and Financial Crimes and the Bureau of Investigations are part of the Criminal Justice Division, which is headed by Chief Deputy Attorney General José Maldonado and overseen by the Senior Deputy Attorney General Jennifer Levy.