Souleang Kane was sentenced in a Boston federal court on January 9, 2018, for conducting an off the books payroll scheme which her temporary employment agency avoided employment taxes and workers compensation insurance premiums. Essentially she was convicted of fraud.
She was sentenced to two years in prison and three years supervised release. She is also to pay restitution. This was after she plead guilty to 18 counts of willful failure to collect and pay taxes to the Internal Revenue Service (IRS) and five counts of mail fraud according to the Department of Justice’s website.
How did this all come about? Well from 2010 to 2015 Kane operated several employment agencies under several names including Expert Staffing, Affordable Staffing, and M&K Temp Inc. which provided staff for companies in Massachusetts in agricultural industries.
Where Kane went wrong is she decided not to report 4.3 million in wages to the IRS. And along with that, she still withheld federal taxes but never paid the taxes that were withheld to the IRS or matching the employer taxes she had to pay.
Where does the insurance fraud come into play? Because Kane didn’t properly report her payroll to worker compensation insurance providers, her insurance premiums were reduced by $165,000 between 2010 and 2015.
My Opinion on This Insurance Fraud Scheme
I believe Kane got off pretty light considering the scam went on for 5 years. I don’t know the amount of the restitution Kane will be required to pay but I can only assume it will like take the rest of her life if she can even find a decent job after being released from prison.
Fraud is fraud whether it relates to taxes or insurance. You just can’t hide an ongoing fraud scheme forever. Someone is eventually going to notice, and they did.