NEW YORK -- Nicole Ingram was at the supermarket when she got a confusing text. Her payroll check for working as a nursing assistant in New Jersey, which had been deposited into her account, was being withdrawn.On that morning in September, thousands of workers across the country received a similar notification
NEW YORK — Nicole Ingram was at the supermarket when she got a confusing text. Her payroll check for working as a nursing assistant in New Jersey, which had been deposited into her account, was being withdrawn.
But days before, according to federal authorities, Michael Mann, president of MyPayrollHR, redirected those payroll funds — $26 million in total, according to a separate lawsuit — into his own personal accounts. The shocking development helped uncover a gigantic fraud operation and showed the lack of oversight in the payroll industry.
Gov. Andrew Cuomo has also ordered state officials to investigate the industry. As a result, the New York State Department of Financial Services has issued subpoenas for more than 40 payroll processors in the state. Mann admitted to stealing almost $70 million since 2010 during an interview with an FBI agent, according to a criminal complaint released when he was arraigned before a U.S. District Court judge in Albany.
In interviews, several people who knew Mann — close friends, a former executive at MyPayrollHR and employees of schools founded or funded by Mann — said that they never suspected he was involved in any criminal activity. In retrospect, one former executive at his company wondered if the change in dress was intended to create a businesslike persona as he struggled to stay financially afloat.
After MyPayrollHR was shut down and Mann’s accounts were frozen, both AlwaysLive.com and Lincoln Academy — which had relocated to Winston-Salem, North Carolina, in 2017 and at the time had 26 students — were shut down.“I hear nobody really knows Michael Mann,” said Zella Hartfield, a nursing aide whose direct deposit was reversed. “All I know is, he really messed up my life.”
Officials from the New York State Department of Financial Services said they did not know when employers would recoup any lost revenue or whether they would receive any compensation at all. Withdrawing rightfully owed funds because of a processor’s own mistake or lack of oversight, however, as Cachet did, is prohibited by National Automated Clearing House Association rules.
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