A grand jury in Greensboro, N.C. has indicted Steven E. Edwards on 21 counts of fraud, money laundering, tax evasion and stealing $3.8 million earmarked for health and workers’ compensation insurance from three employee-leasing businesses. According to a news release issued by the U.S. Attorney’s Office for the Middle District of North Carolina, the former Durham resident was arrested in Chanute, Kan.
The affected employees worked for companies based in North Carolina, California, Florida, Kansas, Michigan, Mississippi, Oklahoma, South Carolina and Tennessee, the indictment states.
Edwards will appear in a federal court in Kansas before being moved to Greensboro to face charges.
Prosecutors think Edwards pocketed the money and used it to buy a mountain villa in Boone as well as maintain a collection of expensive vehicles and motorcycles.
Edwards ran three businesses, Magna Corporation, Nations Group and Integrity Corporation, from a Durham office but based the companies’ operations in Kansas. The businesses, considered Professional Employer Organizations, contracted with smaller businesses to manage insurance and payroll for those companies.
Federal prosecutors think Edwards collected money from January 1999 to April 2001 from his contracted clients but never took out workers’ compensation or health insurance for thousands of affected employees, who were left without coverage, according to the indictment unsealed Tuesday.
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