Christopher Levy has been out of work since June of last year, when federal law enforcement officials shut down Life's Good Inc., alleging that its founder and chief executive, Robert Stinson, was running a $16 million Ponzi scheme.
As if unemployment weren't enough of a burden for Levy, 48, of King of Prussia, the IRS is after him for $353,000 in Life's Good payroll taxes the agency says the Philadelphia company failed to turn over.
"I had nothing to do with taxes," Levy said in an interview at his attorney's office. He said his last title was chief of staff, which meant he was a "glorified firefighter," though he also handled some negotiations for Stinson.
From 2006 to June 2010, Life's Good raised $16 million from investors nationwide, purporting to make high-interest, short-term real estate loans while properties were being fixed up for sale. In reality, prosecutors alleged, Stinson used investors' money for himself and his family, and to pay earlier participants to perpetuate the scheme.
Stinson, in jail since April for violating the terms of a restraining order, is scheduled to change his plea from not guilty to guilty in federal court in Philadelphia on Aug. 15. His attorneys, federal public defenders Felicia Sarner and Stuart Patchen, had no comment Thursday.
Authorities have not charged Levy or other Life's Good employees, some of whom had equally responsible positions, with any crimes. But now the IRS is threatening to turn Levy's life upside down.
"We believe it's really outrageous for the government to be taking this position. You have a criminal on one hand, and you're going to go after the office manager at his company for all this money," said Kevin Johnson, Levy's attorney, who works in the West Conshohocken office of Chamberlain, Hrdlicka, White, Williams & Aughtry.
"It's just not the right thing to do. Someone at the IRS has to step up and say, 'This is not right,' " said Johnson, who was an IRS agent and appeals officer before switching to law.
IRS spokesman Mark Hanson said the agency could not comment on the case.
Surprisingly to many, the IRS can pursue an employee it deems a "responsible person" for unpaid taxes. A responsible person is one who has the authority to decide which bills a company pays and which it does not pay.
"An employee is not a responsible person if the employee's function was solely to pay the bills as directed by a superior," according to an IRS publication on the penalty Levy is fighting.
"My experience is, when the IRS has unfunded payroll taxes, they look at an expansive net of people they can go after," said Stephen Scherf, a certified public accountant and principal at Asterion Inc., a financial and economic consulting firm in Center City.
Check-signing authority is a red flag for the IRS.
Levy started working at Life's Good in August 2008 and got limited check-signing authority in November 2009. Still, he said he had no say over what to pay and what not to pay.
Stinson "would put money into these accounts to pay these things, and at that time I would pay them, but he had total control of what was coming in and what was going out," Levy said.
In May, the IRS filed a $159,135 lien on Levy's house. The rest of the $353,000 demand is under appeal.
The IRS is not going to get the money from Levy, who is married and has two sons, Johnson said. He doesn't have it.
"All they're going to do is ruin Chris' life," Johnson said. "Why should Chris be another victim of Stinson's crimes?"