Frank Alton Moody, II, of Arden, pleaded guilty this week to federal charges that he helped steal $2 million from clients to cover exorbitant salaries paid to executives at CenterCede Services Inc., a payroll services company with clients in Charlotte.
Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina, said Moody, 56, is the third conspirator to plead guilty in the case. Conspirators, Jerry Wayne Overcash, 67, of Charlotte, and John Bernard Thigpen, 60, of Rock Hill, have already been sentenced for their roles in the conspiracy, she said.
Documents filed with the court noted Moody, who was Chairman of the Board of CenterCede, and his co-conspirators defrauded their clients by diverting tax dollars those companies owed the IRS. The money was instead used to pay the salaries of Moody, Overcash and others, and to cover CenterCede’s growing liabilities, officials said.
“To keep the scheme afloat, the conspirators paid only those obligations necessary to keep their ongoing cash flow crisis a secret from clients,” said federal officials.
Court records show that when a client company asked CenterCede why their tax payments had not been paid, Moody called it was an oversight “in the tax department and all is fixed.” In truth, that client’s taxes had been intentionally unpaid, federal officials said.
The conspiracy charge carries a maximum of five years in prison and a $250,000 fine. As part of his plea agreement, Moody has agreed to pay restitution to his victims, the amount of which will be determined by the Court.
Assistant U.S. Attorneys Corey F. Ellis and Taylor J. Phillips of the U.S. Attorney’s Office in Charlotte are in charge of the prosecution.