LANSING, Mich. (WLNS) – A Lansing small business owner is facing multiple felony charges for payroll fraud, but the owner says the whole situation is “overblown”.
For nearly 10 years, the Michigan Attorney General says Camron Gnass withheld over $52,000 from employees’ paychecks for deferred retirement contributions but failed to deposit the funds into their accounts and pay the employer match.
Gnass calls the whole thing an “accounting error” and says he is making up for his employees’ losses.
Gnass started Traction Partners in 2010 and before that owned Vision Creative from 2007 to 2012. Traction remains open in Lansing with five reported employees, including Gnass.
An investigation determined that between 2008 and 2017 Gnass failed to place money into at least two employees’ retirement accounts, even though the money was deducted from their paychecks.
Gnass tells 6 News that the many of the facts laid out in the Attorney General’s press release are “not accurate.”
In late 2017, Gnass paid a portion of the amounts withheld to the affected employees. Gnass tells 6 News that portion is more than 85%. But the Attorney General’s office says amount remains “significantly” short from what was allegedly withheld, plus the employer matches and the lost investment gains.
Gnass is charged with eight felony counts of larceny, four felony counts of receiving and concealing stolen or converted property, and one felony count of Conducting a Criminal Enterprise. Conducting a Criminal Enterprise holds a maximum sentence of 20 years in prison with a maximum fine of $100,000 while the other charges have maximum sentences of five years in prison and varying maximum fines.
Gnass will be arraigned in Ingham County 54A District Court.
“When businesses exploit their workers by cheating them out of their hard-earned money, families have less in their pockets and an uncertain future,” said Michigan Attorney General Dana Nessel. “This has gone on for far too long and Michigan isn’t waiting any longer to crack down on payroll fraud crimes.”
Gnass says “It’s clear the AG is trying to make an example out of me.”
This is the first set of criminal charges originating from the Payroll Fraud Enforcement Unit since the Michigan Attorney General’s Office established the Unit in April.