Bill proposes regulating payroll service companies in state

Legislation comes in wake of AccuPay fraud allegations

March 21, 2013|By Lorraine Mirabella, The Baltimore Sun

A bill introduced in the Maryland Senate Thursday would create a commission to look into regulating payroll service companies in the wake of allegations of fraud at AccuPay of Bel Air.

Sen. Barry Glassman, a Harford County Republican, introduced the bill on the Senate floor, prompted, he said, by hundreds of calls from concerned small-business owners. AccuPay is under investigation for allegedly not sending clients' tax payments to tax collectors.

"AccuPay of Bel Air recently filed bankruptcy, leaving hundreds of small businesses with delayed payroll and delinquent or missed tax payments to the state and federal government," Glassman said in announcing the bill.

The Bel Air Police Department and the Internal Revenue Service began investigating the firm after one of its clients, a Bel Air veterinary hospital, accused it in a lawsuit of failing to pay or making only partial payments of federal and state withholding and unemployment taxes over the past five years. AccuPay closed at the end of February and filed for bankruptcy protection. Other clients had filed similar lawsuits.

Glassman said the state has no bonding requirements or regulatory oversight of payroll service companies. The proposed commission would include members of the state Department of Labor Licensing and Regulation, the Senate and House of Delegates, the Maryland Chamber of Commerce and the Attorney General's office as well as a citizen with a financial background.

The Senate suspended its rules to move the bill to the Senate Finance Committee.

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