Condo developer faces tax fraud allegations

Attorney General Jay Nixon and Camden County Prosecuting Attorney Jim Icenogle today filed criminal charges against Michael G. Schlup, the developer of the luxury condominium complex Plaza Gardens on the Lake near Sunrise Beach at Lake of the Ozarks.

Schlup, 49, is from Leawood, Kan., and owns Schlup Investments Inc. and Plaza Gardens on the Lake Inc. He faces 12 felony counts of failure to deduct Missouri employer withholding tax, one felony count of failure to file a Missouri employer withholding tax return and one felony count of failure to pay Missouri employer withholding tax.

“Those who evade tax responsibilities by not deducting or paying taxes and by paying workers under the table have an unfair and illegal advantage over those businesses that work hard and play by the rules,” Nixon said in a news release. “The playing field for businesses needs to be level.”

The allegations cover the first few months of 2005. Nixon’s office began its investigation after learning of reports of one worker death and several serious worker injuries occurring at the Plaza Gardens construction site.

Nixon said in the release that his office has reason to believe that as many as 30 to 35 undocumented workers may have been working on the site at any one time, each paid between $8 and $9 an hour.

A probable cause statement filed with the charges states that Schlup allegedly paid his workers in cash and deducted no withholdings from the wages. Employees at the site worked 60 to 70 hours per week, according to the statement.

Each felony count is punishable by a fine of up to $10,000 and a prison term of up to five years.