MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Stephanie M. Johnson, 40, New Richmond, Wisconsin, pleaded guilty to failing to pay payroll taxes withheld from her employees’ paychecks. Johnson also pleaded guilty to defrauding her corporation and her business partner. Johnson entered these guilty pleas in U.S. District Court in Madison today.
Johnson was the co-owner of Paradigm Services, Inc., a business operating in New Richmond, and had corporate responsibility to collect and pay over the company’s payroll taxes. Paradigm Services withheld payroll taxes from its employees’ payroll checks and was required to deposit these funds with the IRS on a quarterly basis. At the plea hearing, Johnson admitted that she failed to pay to the IRS payroll taxes in the amount of $28,323.66 on behalf of Paradigm Services’ employees for the period of October 1 to December 31, 2013, and instead kept the money for her personal expenses.
Johnson also admitted that she defrauded Paradigm Services of approximately $197,230.64 by using its corporate debit cards for her personal purchases. Johnson admitted to falsely coding these purchases as business expenses.
U.S. District Judge William C. Conley scheduled sentencing for August 7, 2018. Johnson faces a maximum penalty of five years in federal prison on the tax charge and 20 years on the mail fraud charge.
The charges against Johnson are the result of an investigation by IRS Criminal Investigation. The prosecution of this case is being handled by Assistant U.S. Attorney Darren C. Halverson.