JACKSONVILLE, Fla. – Two operators of a Jacksonville roofing company have pleaded guilty to fraud charges and now face up to 20 years in federal prison.
According to the Department of Justice, Travis Slaughter and Tripp Slaughter have pleaded guilty to conspiracy to commit mail and wire fraud and conspiracy to commit tax fraud related to a Jacksonville roofing business that they operated under various names.
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Prosecutors said Travis Slaughter has agreed to forfeit to the United States $2.7 million in proceeds he obtained from the mail and wire fraud offense and to pay restitution of $6.7 million for the payroll tax loss, $2.7 million for unpaid workers’ compensation insurance premiums and $270,000 for two paid workers’ compensation claims.
Tripp Slaughter has agreed to forfeit to the United States $416,000 in proceeds he obtained from the mail and wire fraud offense and to pay restitution of $623,000 for the payroll tax loss, $416,000 for unpaid workers’ compensation insurance premiums, and $137,778 for a paid workers’ compensation claim, prosecutors said.
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, investigators said.
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, according to investigators. 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).
During the period of January 2017 through July 2020, the PEOs issued payroll checks to the employees totaling approximately $4,930,613, after deducting and paying over to the IRS the payroll taxes due. During that same period, the company issued checks to the employees totaling approximately $18,545,845, with no payroll taxes being deducted or paid. The total unpaid payroll taxes on that amount were $2,768,377.
The PEOs also secured workers’ compensation insurance coverage for the company. The premiums charged by the workers’ compensation insurers were based on the total amount of payroll that the company reported to the PEOs. If the company had reported the actual amount of payroll, the insurers would have charged additional premiums totaling $2,780,947.
In addition to causing the company to underreport their payroll to the IRS, the Slaughters also admitted to underreporting their personal income to the IRS.
For the tax years 2014 through 2019, the total unpaid taxes due on Travis Slaughter’s unreported income totaled $2,467,183. For the tax years 2015 through 2019, the total unpaid taxes due on Tripp Slaughter’s unreported income totaled $263,614.
A sentencing date for the two men has not yet been set.
According to the Florida Times-Union, Travis Slaughter was also investigated after not paying $2.2 million in fines to the U.S. Occupational Safety and Health Administration (OSHA).
