The owner of a shuttered nursing home chain admitted to his role in a $38 million employment tax fraud scheme.
Joseph Schwartz, 64, pleaded guilty to willfully failing to pay over employment taxes withheld from employees at his company and willfully failing to file an annual financial report with the Labor Department for the 401(k) plan he sponsored, according to a Jan. 17 Justice Department news release.
From Oct. 31, 2017, to May 30, 2018, Mr. Schwartz was the owner of Wood Ridge, N.J.-based Skyline Management Group. The group acquired nearly 100 nursing homes in 11 states in 2016 and 2017 before going under due to lack of funds, The Philadelphia Inquirer reported.
He admitted to failing to collect and truthfully account for and pay over trust fund taxes to the IRS, which amounted to $38.9 million.
The employment tax fraud count carries a maximum of five years in prison and a $250,000 fine, or twice the gross gain or loss from the offense, whichever is greatest. The charge related to the 401(k) accounts carries a maximum of 10 years in prison and a $250,000 fine. Mr. Schwartz is scheduled to be sentenced May 22.