Ohio Exec Embezzled Money From Employee Retirement Fund

ROCKY RIVER, OH — A Rocky River man has been convicted for embezzling money from his employees retirement fund. C. David Snyder also collected $860,000 from his employees, but didn't pay the money to the IRS.

“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 home, pool renovation and otherwise fund his own lavish lifestyle," U.S. Attorney Justin E. Herdman said.

Snyder was convicted this week on six charges related to embezzling $126,000 from his employee's retirement fund. He was also convicted on five counts of failure to pay over taxes.

Snyder was the chairman, president and CEO of Attevo, Inc., a technology consulting company in Cleveland. He was also the chairman and primary shareholder at Ruralogic, Inc., headquartered in Bryan, Ohio.

In 2011, Snyder, on behalf of Attevo, made a monthly payment plan with the IRS, to repay the company's outstanding payroll tax liabilities. The company was set to make 10 payments of $48,350, per month, the Department of Justice said.

Snyder withheld payroll tax from his employees, but he never paid that money to the IRS. Court documents said the 61-year-old failed to pay $328,355 from employee payroll taxes in 2010, and about $530,778 in 2012.

“Business owners have a responsibility to withhold income taxes for their employees and then remit those taxes to the Internal Revenue Service,” said IRS Special Agent in Charge Ryan Korner. “The failure to pay over withheld taxes results in the loss of tax revenue to the United States government and the loss of future Social Security or Medicare benefits for employees.”

To boot, Snyder created a 401(k) and profit-sharing plan for Attevo employees in 2009. Ruralogic was added to that plan in 2010.

The plan was funded through employee payroll deferrals. But, between 2010 and 2012, Snyder didn't pay into the plan approximately $126,000 in contributions and loan repayments withheld from Attevo and Ruralogic employee wages, court documents said.

What happened to all of this money? The Department of Justice said Snyder paid $20,000 per month to rent a home in Lakewood, a vacation home in Chautauqua, New York, leases on four vehicles, and other personal expenses.

He also used Attevo's American Express 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 resorts in Florida and for pool and spa renovations, according to trial testimony and court documents.

On top of all that, Snyder earned about $1.6 million from Attevo in income between 2009 and 2012, court documents said.

Snyder will be sentenced on Oct. 9, the Department of Justice said.

This case was investigated by the Internal Revenue Service – Criminal Investigations and the U.S. Department of Labor – Office of Inspector General.

“An important mission of the Office of Inspector General is to investigate allegations relating to labor racketeering and theft of pension funds covered by ERISA. We will continue to work with our law enforcement partners to investigate these types of allegations,” said James Vanderberg, Special Agent-in-Charge of the Chicago Regional Office of the United States Department of Labor, Office of Inspector General.

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