Jury convicts business executive

Man, 61, collected $860,000 from employees and did not send it to IRS

Business executive C. David Snyder was convicted on charges related to taxes and an employee fund.

“A jury found this defendant embezzled money from his employees. He also took taxes out of their paychecks, but instead of paying the taxes of the IRS, he used the stolen money to pay for his vacation, pool renovation and otherwise fund his own lavish lifestyle.”

— U.S. Attorney Justin E. Herdman

A jury convicted Rocky River business executive C. David Snyder on six charges related to embezzling $126,000 from an employee retirement fund and collecting nearly $860,000 from employees but not paying the money to the IRS, according to a news release from the U.S. Attorney’s Office.

Snyder, 61, is scheduled to be sentenced Oct. 9. He was convicted on one count of embezzling from an employee pension fund and five counts of failure to pay taxes. He was acquitted on two other charges, the release said.

Snyder served as chair, president and chief executive officer of Attevo Inc., a technology consulting company headquartered in Cleveland. He also served as chairman and primary shareholder of Ruralogic Inc., headquartered in Bryan.

Attevo employees prepared financial records and schedules, quarterly and annual returns and reports for Attevo, at Snyder’s direction. Snyder ranked Attevo’s payables in order of importance, according to court documents.

Snyder, on behalf of Attevo, and the IRS in 2011 agreed to a monthly payment plan of $48,350 per month to repay the company’s outstanding payroll tax liabilities. Attevo made 10 payments totaling 483,500 then made no further payments, according to court documents.

Snyder withheld payroll tax from employes but failed to pay it to the IRS. Snyder failed to pay more than $328,355 of employees portion of payroll taxes in 2010 and about $530,778 in 2012, according to court documents.

Snyder created a 401(k) and profit-sharing plan for Attevo employees in 2009. Ruralogic was added to the plan in 2010. The plan was funded through the employee payroll deferrals. Between 2010 and 2012, Snyder failed to pay into the plan approximately $126,000 in contributions and loan repayments withheld from Attevo and Ruralogic employee wages, according to court documents.

During the time of his criminal conduct, instead of paying Attevo’s employment taxes, Snyder paid $20,000 per month for the rental of a personal residence in Lakewood and a vacation home in Chautauqua, New York, leases on four vehicles and other personal expenses, according to trial testimony and court documents.

He also used Attevo’s credit card to pay personal expenses, including women’s clothing at Ann Taylor, Nieman-Marcus and other stores, beauty supplies at Oro Gold in Las Vegas, travel to resorts in Florida and for pool/spa renovations, according to trial testimony and court documents.

Snyder earned income from Attevo totaling approximately $1.6 million between 2009 and 2012, according to the court documents and trial testimony.

“A jury found this defendant embezzled money from his employees,” said U.S. Attorney Justin E. Herdman. “He also took taxes out of their paychecks, but instead of paying the taxes of the IRS, he used the stolen money to pay for his vacation, pool renovation and otherwise fund his own lavish lifestyle.”

Ryan Korner, a special agent with the IRS, said business owners have a responsibility to withhold income taxes for their employees and then remit those taxes to the IRS.

“The failure to pay over the withheld tax revenue to the U.S. government results in the loss of future Social Security or Medicare benefits for employees.”

This case was investigated by the IRS-Criminal Investigation and the U.S. Department of Labor-Office of Inspector General. It was prosecuted by Assistant U.S. Attorneys Michael L. Collyer and Megan R. Miller.