A Massachusetts man pleaded guilty in federal court in Boston this week to payroll tax avoidance and workers’ compensation insurance fraud, prosecutors reported.
According to the U.S. attorney’soffice, Henry Lam, of Lowell, used cash payments to employees to hide his firm’s true payroll, avoid collecting and paying taxes, and lowering his workers’ compensation costs.
Between 2016 and 2023, Lam owned and operated HL Temporary Services – a temporary employment agency in Lowell that served companies in Massachusetts. The clients paid HL Temporary Services for the temporary employees’ work on an hourly basis. Lam cashed these client’s checks at check cashing businesses in Massachusetts and paid the temporary employees primarily in cash. By using cash payments, Lam hid over $6.1 million in payroll and avoided paying more than $1.5 million in required payroll taxes.
Lam also used HL Temporary Services’ false payroll numbers to obtain worker’s compensation insurance at lower rates, prosecutors said.
Lam was arrested in July 2025 following his indictment. U.S. District Court Chief Judge Denise J. Casper scheduled sentencing for Aug. 27.
Lam pleaded guilty to failure to collect and pay over taxes and mail fraud. He faces possible sentencing of from five to 20 years in prison and fines of $250,000, and restitution.
U. S. Attorney Leah B. Foley and IRS Special Agent Thomas Demeo made the announcement. The investigators were assisted by the Insurance Fraud Bureau of Massachusetts.
Source: U.S. Attorney for Massachusetts
Topics
Fraud
Workers’ Compensation
Talent
Massachusetts
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