Joseph Schwartz, owner of defunct nursing home chain, pleaded guilty to tax fraud
Schwartz's company, Skyline Healthcare, collapsed in the spring of 2018.
Joseph Schwartz, the owner of a defunct nursing home chain, including 10 in the Philadelphia area, pleaded guilty to failing to pay $38 million in payroll taxes from mid-2017 through June 2018, the U.S. Attorney for New Jersey announced Wednesday.
“Schwartz admits he willfully failed to pay over employment taxes, basically stealing money from his employees and the IRS,” James E. Dennehy, special agent in charge of the FBI’s Newark office, said in a news release.
The guilty plea is the latest development in a case that captured national attention in 2018 and was a factor in Pennsylvania’s adoption last year of new and more rigorous regulations for reviewing individuals who want to buy nursing homes in the state.
Schwartz’s Skyline Healthcare LLC, which acquired nearly 100 nursing homes in 11 states in 2016 and 2017, underwent a rapid-fire collapse during the spring of 2018 as the Wood-Ridge, N.J., company ran out of cash.
Regulators in Pennsylvania and several other states put emergency operators in place to protect thousands of residents.
Different companies have since taken over the facilities, most of which had been operated by Golden Living, a company that subsequently left Pennsylvania after being sued by the Pennsylvania Attorney General over allegedly misleading marketing.
Schwartz, 64, of Suffern, N.Y., also pleaded guilty to not filing a financial report required by the U.S. Department of Labor for his company’s 401(k) retirement plan. Sentencing is scheduled for May 22. He faces up to 10 years in prison.