TRENTON, N.J. — The former owner of a payroll processing company who ran a multimillion-dollar fraud scheme through the firm has been sentenced to nearly six years in prison.
John Scholtz was also ordered Tuesday to pay more than $9.5 million in restitution. The 68-year-old Sea Isle City man had pleaded guilty in March to wire fraud and transacting in criminal proceeds.
Scholtz ran Innovative Payroll Services LLC. His clients included municipalities, educational institutions and small- to medium-sized, privately held companies in New Jersey and elsewhere.
Clients would routinely deposit funds to pay for payroll taxes into IPS bank accounts. From February 2012 to January 2016, Scholtz withdrew or had staffers withdraw funds from those accounts.
He used the funds to pay operating expenses and personal expenses, including payments for homes, cars, boats, airplanes and credit cards.