Multistate real estate showing appointment service eShowings Inc. has shut down, just days after the incarceration of its founder and former CEO, Charles Smith.
The move leaves an estimated 14,000 clients in the lurch and the firm’s 85 or so employees out of work.
Smith, who founded the company in 1999, headed to prison on Dec. 4 to serve a 2 1/2-year sentence for pocketing his employees’ payroll taxes instead of handing them over to the government.
According to the U.S. Attorney’s Office for the District of Delaware, Smith had taken money deducted from employees’ paychecks and spent it on personal items for himself and his family, including vacations and gambling. Smith also continued to use company funds even after he had officially resigned in early October.
EShowings also continued to bounce checks, including employee paychecks, and had not paid rent or other liabilities or employee insurance premiums since Smith’s Oct. 4 sentencing, the office said.
Two days after Smith’s incarceration, the company’s employees were informed their weekly Friday paychecks would be delayed until Tuesday due to lack of funds. By Monday evening, Tomy Kot, the company’s general manager, was calling employees to tell them the company had been shut down and they would not be receiving their last two weeks’ worth of pay.
- See more at: http://www.inman.com/2013/12/11/eshowings-shuts-down-after-founder-reports-to-prison/?utm_source=20131212&utm_medium=email&utm_campaign=dailyheadlinesam#sthash.mdg0tMcD.dpuf
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