Texas Man Pleads Guilty to Defrauding Company of $300,000
MEMPHIS, TN—A Texas man has pled guilty to maintaining a scheme that defrauded a labor service provider of $300,000. Edward L. Stanton III, U.S. Attorney for the Western District of Tennessee, announced the guilty plea today.
According to information presented in open court, Robert Ross was employed by Impact Logistics for two decades. Impact was a cost per unit labor service provider for large distribution companies such as Home Depot, Ryder Truck Rentals, and Discount Tire. Among the services provided by the company were loading and unloading trailers, performing assembly line work, sorting, and shrink wrapping products.
Impact operated in multiple states including Tennessee, California, Texas, Georgia, Mississippi, Illinois, and Pennsylvania. The company maintained a corporate office in Memphis. Impact employees were paid through direct deposit or prepaid debit cards titled “Transcards.”
Ross held the position of senior director prior to his termination, according to court information. Under the role, he was responsible for managing Impact’s operations in Atlanta, Georgia and Dallas, Texas. He reportedly ensured that all billing and payroll was done accurately and submitted to the corporate office.
From February 2013 to June 2015, Ross defrauded Impact of $300,000 by making fraudulent representations regarding the employment status of former employees. He also made fraudulent entries in payroll records.
According to court information, Ross executed his scheme by intentionally failing to notify Impact when an employee resigned from the company. Thus, the former employee was not removed from the Impact payroll. Ross would falsely claim that the employees had lost their Transcards and requested for new prepaid cards to be activated. Impact would subsequently mail new Transcards from Memphis to Ross’
Mansfield, Texas residence. After receiving the Transcards, Ross submitted falsified time records in the name of the former employees to reflect that they had worked and were entitled to payment, according to court information. When Impact loaded money on the Transcards to pay the former employees, Ross used the funds for his personal benefit. Ultimately, he defrauded Impact of approximately $300,000.
Ross faces up to 20 years’ imprisonment for wire fraud and a fine of up to $250,000. He’s scheduled to be sentenced by Judge John T. Fowlkes Jr. on Thursday, December 17th.
The case is being investigated by the Federal Bureau of Investigation.
Assistant U.S. Attorney Carroll Andre is prosecuting the case on the government’s behalf.