Seven former employees at a Florida construction company continued receiving paychecks after leaving the business, but investigators say the money was redirected into accounts controlled by the company’s financial controller.
Jimmy Paul Garcia Velez, 31, allegedly kept the workers active in the payroll system for approximately seven months and changed their direct-deposit information.
Detectives said the payments gave him an additional $15,456.72 while he continued receiving his regular salary.
Authorities also accuse Garcia Velez of stopping deductions for his share of his health-insurance premiums, leaving the company to cover the full cost.
The Deposits Allegedly Went Into Two of His Accounts
Garcia Velez worked as the financial controller for a Palm Coast construction company and oversaw its payroll, according to FOX 35 Orlando. Instead of sending the payments to the former employees, Garcia Velez allegedly replaced the direct-deposit details attached to their payroll records.
The Flagler County Sheriff’s Office said the money was routed into two bank accounts belonging to him. He continued receiving his legitimate salary while allegedly collecting the additional deposits. Detectives subpoenaed banking records and calculated that the redirected payments totaled $15,456.72.
Investigators said Garcia Velez also altered deductions connected to his own health-insurance coverage. He allegedly stopped the payroll deductions that would ordinarily pay his share of the premiums, leaving the construction company responsible for the full cost.
Garcia Velez Faces Fraud and Grand Theft Charges
The business owner contacted the Flagler County Sheriff’s Office after noticing discrepancies in the company’s health-insurance expenses. Investigators then reviewed payroll activity and obtained bank records that allegedly connected the former employees’ direct deposits to Garcia Velez’s accounts.
Members of the sheriff’s Fugitive Unit arrested Garcia Velez on a warrant charging him with organized scheme to defraud and grand theft. He was booked into the Sheriff Perry Hall Inmate Detention Facility and later released after posting a $10,000 bond.
The charges are allegations. The sheriff’s announcement did not report that Garcia Velez had entered a plea or been convicted.
Active Employee Records Can Be Matched Against Every Payroll Run
The Government Accountability Office has recommended maintaining an employee list independent of the payroll system so active-worker records can be compared with each payroll register. For a smaller business, that review can include matching every paid employee against current personnel records, checking termination dates and identifying multiple workers whose deposits are going to the same bank account.
Direct-deposit changes should require approval from someone who cannot also create employees, process payroll and release payments. The IRS notes that fraud frequently develops where internal controls are weak or one employee controls duties that should be separated.
Businesses reviewing a suspected payroll diversion should preserve payroll registers, direct-deposit change records, bank files, employee termination documents, insurance invoices and system-access logs before changing or deleting account information.