Employee-Services.Net Inc., a payroll-processing company in Cornelius, is being sued by a company that claims it didn’t send required withholding taxes to the government.
Carolina Material Handling Services filed the lawsuit Friday in federal court in Charlotte. The company, represented by attorney Will Terpening, said that it had contracted with ESN to process its payroll for eight years.
But in its complaint, Carolina Material said taxing authorities contacted the company March 12 to tell it they hadn’t received more than $211,000 worth of required taxes. ESN had collected the money from Carolina Material’s payroll, the complaint said, but hadn’t sent it to the government.
Mike Elliott, a Huntersville attorney representing ESN, said Monday that he couldn’t comment on the case becase he has not seen the complaint yet.
In its complaint, Carolina Material said it learned in a March 21 phone call with a “representative” from ESN that the company “had collected but failed to remit $8 million in Employee Tax Withholdings from approximately 200 victim companies,” starting in the third quarter last year.
Carolina Material is suing for fraud and requesting damages, legal fees and its money back. The company also names eePayroll, a company created last year at the same Cornelius address as ESN, as a co-defendant. Staff researcher Maria David contributed