A Florida health care executive who withheld millions in payroll taxes from his employees and used the funds for personal expenses, including luxury shopping and a yacht, has been sentenced to 18 months in federal prison.
P.W., who controlled a network of health care companies operating under names including Palm Health Partners and Palm Health Partners Employment Services (PHPES), was sentenced Friday after pleading guilty to willfully failing to pay employment taxes and failing to file individual income tax returns. He was also ordered to serve two years of supervised release and to pay more than $4.3 million in restitution to the United States.
Withheld but never remitted payroll taxes
According to the U.S. Department of Justice, P.W. was responsible for more than $24 million in annual payroll across over 600 employees. As an employer, he was legally required to withhold Social Security, Medicare, and federal income taxes from employees’ pay and remit those funds to the Internal Revenue Service, along with the employer’s share of payroll taxes.
Instead, from 2016 to 2019, P.W. withheld more than $7.4 million in employee taxes and failed to pay them to the IRS. He also neglected to remit more than $3.4 million in employer contributions. Prosecutors said he used the money to fund a lavish lifestyle, including over $1 million from company accounts spent on a yacht, personal luxury goods, and transfers to personal bank accounts.
Retail purchases included high-end spending at Bergdorf Goodman, Cartier, and Saks, according to court documents.
Years of evasion despite IRS warnings
The misconduct extended over more than a decade. In 2011, P.W. failed to remit two quarters’ worth of taxes. After IRS enforcement efforts in 2012 and an initial repayment in 2014, he resumed the scheme the following year.
P.W. stopped filing personal income tax returns starting in 2018, despite receiving a $360,000 salary from PHPES and withdrawing $450,000 from company accounts.
In 2019, he created a new company, NextEra, with a family member listed as majority owner. However, he retained financial control and used the business to funnel hundreds of thousands of dollars for personal expenses and transfers to relatives.
In total, P.W.’s actions resulted in a tax loss of nearly $11 million.
Enforcement emphasizes employer accountability
“Business owners who withhold employment taxes are acting as fiduciaries for their employees,” said IRS Criminal Investigation Special Agent in Charge Emmanuel Gomez. “When they instead use that money for personal enrichment, it undermines the tax system and the rights of their workers.”
The case was prosecuted by the Justice Department’s Tax Division and investigated by IRS Criminal Investigation’s Miami Field Office.
