Matt Brown’s troubles seem to be piling up for him, his family, and his companies.
Mr. Brown’s company, Elite Temps, was raided by the FBI on July 12th at 9:30am.
Mr. Brown was eventually arrested and made his initial appearance in Federal Court on October 30, 2024.
He is facing two criminal charges – 1) willful failure to pay trust fund taxes and 2) aiding and assisting in the filing of false tax returns. According to the charges filed, Mr. Brown failed to pay over $13,000,000 in trust fund taxes and he failed to pay over $9,000,000 in employment taxes.
Count 1, willful failure to pay trust fund taxes, is punishable up to 5 years with supervision post release for up to 3 years and a fine. For Count 2, aiding and assisting in the filing of false tax returns, is punishable up to 3 years with a supervised release for up to 1 year and a fine.
While Mr. Brown is scheduled to appear before U.S. Magistrate Judge Shaniek M. Maynard in Federal Court on January 8, 2025, there are multiple cases moving through the Martin County courts that will also have repercussions for not just Mr. Brown and his companies but for his accusers.
And that’s just the existing criminal charges he is facing. What about the civil cases?
It’s important to note that both Aaron Brown and Associates and Matt Brown and Associates both used Elite Payroll as a “doing business as.”
Ivox Solutions: The Canary in the Accounting Coalmine
Mr. Brown has been sued 6 times in Martin County and has already settled a majority of the cases.
The oldest case dates back about two and half years before the IRS raid. On February 25, 2021, Ivox Solutions filed suit against Matthew Brown & Associates, Inc. d/b/a Elite Payroll Solutions.
According to the complaint, Elite Payroll was hired to “provide worker’s compensation insurance, pay employment taxes, and provided (sic) and pay for employee healthcare for the employees provided to IVOX.”
Elite was accused of overcharging Ivox for at least the last five years of the contracted relationship from 2015 to 2020 with the counts consisting of Unjust Enrichment, Breach of Contract, Fraud, and Accounting (malpractice).
In a letter sent to Mr. Brown on November 18, 2020, it was stated by Ivox’s legal counsel that Mr. Brown and Elite Payroll overcharged Ivox $429,738.96 in Florida unemployment taxes while also not properly reporting income to the Social Security Administration who were, at the time, being notified that they had not been contributing to the Social Security system.
The request to resolve this amicably within 15 days.
Fast forward to 2023.
An amended complaint was filed June 6, 2023, with allegations of the original claims – Unjust Enrichment, Breach of Contract, and Fraud, but also the additional counts of Fraud in the Inducement, Promissory Estoppel, and Violation of Florida Deceptive and Unfair Trade Practices.
It took until August 14, 2023, for the case to be dismissed based on a joint stipulation by both parties. It is unclear if there was a monetary settlement negotiated as part of the dismissal.
What is clear is that Matt Brown and his companies were given ample notice that their misdeeds were being put under the microscope by their clients.
Other Civil Filings in Martin County
On October 23, 2023, Duraseal of the Treasure Coast filed a civil lawsuit against Aaron Brown and Associates alleging that Aaron Brown and Associates d/b/a Elite Payroll, starting on or about April 23, 2012, was to “provide payroll tax services, tax filings, and related payroll services.”
This agreement provided that Elite Payroll would, amongst other things, pay the IRS the tax monies withheld by Duraseal from its employees.
The complaint states that Elite had access to Duraseal’s bank account to make these required payments and would provide to Duraseal an invoice accounting for the activity made by Elite Payroll on Duraseal’s behalf.
When filing their complaint, Duraseal noted the other cases making their way through the Martin County court system.
Duraseal ordered the IRS transcripts related to the raid for 2019 to 2023 and through their own investigation of the documents and comparison to their bank records they came to realize the discrepancies. The payments claimed to have been made by Elite to the IRS on Duraseal’s behalf were less than what was indicated by Elite.
In fact, in some cases, Elite took the money from Duraseal’s account and didn’t make any payments to the IRS.
The complaint states that between 2019 and 2021 Elite Payroll took $156,336.25 that never made it to the IRS.
The case filed by Garden Hospitality d/b/a 2nd Street Bistro on July 18, 2023, is similar except this case is against Aaron Brown and Associates d/b/a Advantage HR Services.
Their agreement was entered into on or about November 21, 2014 stating that Advantage would provide “payroll tax services and filings, and other payroll and human resource services.”
The complaint states that the amount taken but not paid by Aaron Brown and Associates is $1,449,098.68.
Lake Oconee Bistro, a restaurant in Georgia, also filed a suit in Martin County.
The complaint filed on July 18, 2023, states Lake Oconee Bistro entered into a similar agreement on or about February 10, 2020. The services to be provided were similar to the others mentioned. However, this lawsuit was settled on October 9, 2023. The case was dismissed after both sides stipulated to a confidential settlement agreement allowing Mr. Brown and his associates to avoid going to trial.
Similarly, Ocean Village Bistro also filed a complaint on July 18, 2023, seeking restitution of $348,436.86.
Like Lake Oconee Bistro, they settled on September 12, 2023 through a confidential settlement and avoided going to trial.
There are other pending cases that exist, like the case of Aaron Schamback, DDS, against Aaron Brown and Associates d/b/a Elite Payroll. However, Dr. Schamback’s initial complaint filed July 30, 2023, does not list a dollar amount for which they are alleging was basically stolen and are seeking restitution.
An amended complaint filed October 3, 2024, seeks restitution of $14,929.50.
According to Dr. Schamback’s complaint, the IRS was reaching out and sending summons to clients of Elite Payroll / Matthew Brown and Associates / Aaron Brown and Associates as early as February 2023, 6 months before the raid in Stuart.
The Complaint states: “On or about February 27, 2023, special agents from the IRS Criminal Investigation Division appeared at the home of Plaintiff’s principal Aaron Schamback, DMD. Dr. Schamback was served with a summons requiring Dr. Schamback to provide all of the Plaintiff’s corporate bookkeeping, and financial and bank account records for various years. This was Plaintiff’s first indication that anything was amiss with regard to Defendant’s payment of the withholding and other taxes to the IRS from monies withdraw from Plaintiff’s accounts by Defendant.”
The complaint goes on to say “Dr. Schamback has been a client since April 2014. ‘Defendant represented it had ‘more than $80 billion in annual payroll processed on our software platform’ It further stated in its website that ‘you can rest easy, knowing you’re on a tried-and-true payroll solution’.”
Similarly to the other plaintiffs, they sued for:
- COUNT 1 FLORIDA’S DECEPTIVE AND UNFAIR TRADE PRACTICES ACT (“FDUTPA”) – ’ unconscionable, deceptive, and unfair practices and acts.
- COUNT 2 BREACH OF CONTRACT
- COUNT 3 BREACH OF FIDUCIARY DUTY
- COUNT 4 FRAUD
In all of the civil cases, Aaron Brown and Associates is represented by Preethi Sekharan, an attorney at Gunster, Yoakley, and Stewart.
The cases listed most recent to oldest. All can be found the Martin Clerk of Court’s website.
24000680CAAXMX – AARON SCHAMBACK DMD PA vs. AARON BROWN AND ASSOCIATES INC
23001383CAAXMX – DURASEAL OF THE TREASURE COAST INC vs. AARON BROWN AND ASSOCIATES INC A FL CORP
23001127CAAXMX – OCEAN VILLAGE BISTRO INC vs. AARON BROWN AND ASSOCIATES INC
23001126CAAXMX – GARDEN HOSPITALITY INC vs. AARON BROWN AND ASSOCIATES INC
23001125CAAXMX – LAKE OCONEE BISTRO INC vs. AARON BROWN AND ASSOCIATES INC
21000219CAAXMX – IVOX SOLUTIONS LLC vs. MATTHEW BROWN & ASSOCIATES INC
The impact of Elite Payroll’s actions…
The issue isn’t just that monies were taken from a client and kept by Mr. Brown. The issue is also that Duraseal and other companies are responsible for all payments of unpaid payroll taxes but also all related penalties and interest that is assessed by the IRS.
Mr. Brown’s actions and impacts not only affect the companies who trusted him and paid him to pay their taxes but also their employees as well as Mr. Brown’s personal employees.
For context, Dr. Schamback states that all times he employed around 100 people. If you extrapolate that across the number of clients Mr. Brown had, how many employees were affected?
Mr. Brown used the monies he should have given to the IRS to live an extravagant lifestyle as stipulated in the complaint filed in federal court that claims he stole over $20 million from his clients, the federal government, and ultimately the American people.
Matthew Brown is scheduled for a change of plea hearing on January 8, 2025 at 10am. Prior to this happening, his attorneys will need to a submit a stipulated factual proffer – a legally binding contract between, in this case, a federal prosecutor and a criminal defendant where the defendant concedes to facts of a case – as well as a written plea agreement.
What punishment he serves for his alleged criminal activity is to be determined.
We will be in court for the change of plea hearing on January 8th.
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