HV Businessman Accused Of Failure To Pay Payroll Taxes

POUGHKEEPSIE, NY — A Dutchess County man was accused of not paying payroll taxes. Geoffrey S. Berman, the U.S. Attorney for the Southern District of New York, announced Thursday federal tax charges against William R. Grogg, 69, of Millbrook, for willfully failing to pay payroll taxes for his company and obstructing the administration of internal revenue laws.

"As alleged, William R. Grogg failed to pay over payroll taxes for his company for years, and then lied to the IRS about it," Berman said. "This cost the government hundreds of thousands of dollars in tax revenue. Grogg now faces 18 counts of criminal tax charges, and the possibility of time behind bars."

According to prosecutors, since the late 1980s, Grogg worked in the printing and publishing industry in and around Poughkeepsie. In his more than three decades in the industry, he has owned, managed and/or had significant control over the financial affairs of a number of printing and publishing companies, including Hamilton Reproductions Inc.; Hamco, which was later called Netpub Corporation; Netpublications Inc. and MCA-Netpub.

In 1994, the IRS assessed a civil penalty of more than $368,000 against Grogg who authorities said was responsible for the failure to pay the IRS payroll taxes owed by Hamilton Reproductions.

Authorities said Grogg also failed to turn over to the IRS payroll taxes for his other companies, including one in which he utilized a third-party payroll service.

In addition, when Grogg was contacted by the IRS about his payroll tax compliance, prosecutors said he made false statements in writing and during interviews that attributed the ownership of his companies to a deceased Canadian businessman and that business records were kept in a garage and were destroyed in a flood.

Berman said that Grogg was charged with 17 counts of knowingly and willfully failing to pay over Netpublications' and MCA's payroll taxes, each of which carries a maximum sentence of five years in prison, and one count of corruptly endeavoring to obstruct and impede the due administration of the internal revenue laws, which carries a maximum sentence of three years in prison.

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