For months, 11 employees at a Somerset home healthcare agency faced costly medical bills, unaware their employer had failed to remit contributions withheld from their wages to their healthcare plans, leading to a lapse in their medical insurance. An investigation at Cumberland Behavior Group LLC by the US Department of Labor’s Employee Benefits Security Administration found that from March 1, 2019, through May 1, 2019, the company’s owner and then executive director Ace R. Jones II withheld contributions from employees pay for promised healthcare benefits, and failed to pay the monthly premiums to Humana, leading the insurer to retroactively cancel employees’ coverage. As a result, during March and April of 2019, 11 employees incurred $41,766 in unpaid claims because they believed they had coverage.
IRS investigators also found Jones withheld $259,648 in payroll taxes — including Medicare and Social Security taxes — from employees’ paychecks and failed to deposit them with the IRS, instead diverting the funds for company and personal use. EBSA’s and the IRS’s investigation led to the filing of Jones’ guilty plea on September 20, 2021 in the US District Court for the Eastern District of Kentucky. On Jan. 12, 2022, the court sentenced him to 12 months and one day in prison, as well as 2 years of supervised release. In addition, Jones agreed to pay the IRS the taxes he withheld and a $500 special assessment to the court. Jones had previously paid $41,766 to the 11 employees with unpaid health claims.
