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VITELCO ACCUSED OF MANIPULATING PAYROLL

St. Croix attorney Lee Rohn alleged Wednesday that Innovative Communications Corp. has on at least on one occasion moved an employee from its subsidiaries to ICC-owned Virgin Islands Telephone Corp. to affect the phone company’s bottom line.
ICC, owned by St. Croix businessman Jeffrey Prosser, is the parent company of Vitelco, Vitelcom, VitelCellular, St. Croix Cable TV, St. Thomas-St. John Cable TV, the Virgin Islands Daily News and VitelCellular.
Rohn said that earlier this week she filed a wrongful discharge lawsuit in Territorial Court on behalf of former St. Croix Cable TV employee Larry Nyfield. Rohn alleged that after Nyfield was placed on the Vitelco payroll, his 401K retirement plan didn’t transfer.
"When he complained about it and why he was working for Vitelco, he lost his job," Rohn said.
Vitelco is an Industrial Development Commission beneficiary that receives almost 100 percent tax breaks. It is also guaranteed an 11 percent rate of return on expenses by the V.I. Public Services Commission. Critics of Vitelco claim that by adding employees to the company’s payroll its profitability is undermined.
None of the other ICC subsidiaries, such as the cable companies, receive tax breaks from the government. Shifting payroll costs of those companies to Vitelco would enable the company to avoid certain tax liabilities.
Over the summer, Sen. Adlah "Foncie" Donastorg also alleged that ICC was shifting employees from its subsidiaries to Vitelco’s payroll. His protests, however, faded after he couldn’t substantiate the allegations.
"He couldn’t get the check stubs," Rohn said. "I have the check stubs."
Vitelco spokeswoman Katrina Comissiong said she was unaware of any lawsuit and added that if there was one, it would be "absolutely inappropriate" to make a comment.
"It doesn’t pertain to Vitelco," she said. "It would be better suited for ICC to comment."
A call to ICC spokesman Edwin Crouch was returned by an ICC employee who said Crouch was in a meeting. The employee said Crouch, who apparently misunderstood the reporter’s query, referred the matter to Daily News Executive Editor J. Lowe Davis.
Rohn, meanwhile, said she has reported her allegations to the U.S. Attorney’s Office, the PSC and the V.I. Attorney General’s Office.
And in a Dec. 7 letter to Keithley Joseph, executive director of the PSC, Donastorg again questioned Vitelco’s operations.
"We cannot overlook the fact that the salaries of these employees of these unrelated businesses are being paid directly by Vitelco – depleting this utility of the funding necessary to operate effectively," Donastorg wrote.
He also said that the alleged payroll practice and the failure to reinvest in the phone system are a "direct violation" of Vitelco’s IDC benefits.

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St. Croix attorney Lee Rohn alleged Wednesday that Innovative Communications Corp. has on at least on one occasion moved an employee from its subsidiaries to ICC-owned Virgin Islands Telephone Corp. to affect the phone company’s bottom line.
ICC, owned by St. Croix businessman Jeffrey Prosser, is the parent company of Vitelco, Vitelcom, VitelCellular, St. Croix Cable TV, St. Thomas-St. John Cable TV, the Virgin Islands Daily News and VitelCellular.
Rohn said that earlier this week she filed a wrongful discharge lawsuit in Territorial Court on behalf of former St. Croix Cable TV employee Larry Nyfield. Rohn alleged that after Nyfield was placed on the Vitelco payroll, his 401K retirement plan didn’t transfer.
"When he complained about it and why he was working for Vitelco, he lost his job," Rohn said.
Vitelco is an Industrial Development Commission beneficiary that receives almost 100 percent tax breaks. It is also guaranteed an 11 percent rate of return on expenses by the V.I. Public Services Commission. Critics of Vitelco claim that by adding employees to the company’s payroll its profitability is undermined.
None of the other ICC subsidiaries, such as the cable companies, receive tax breaks from the government. Shifting payroll costs of those companies to Vitelco would enable the company to avoid certain tax liabilities.
Over the summer, Sen. Adlah "Foncie" Donastorg also alleged that ICC was shifting employees from its subsidiaries to Vitelco’s payroll. His protests, however, faded after he couldn’t substantiate the allegations.
"He couldn’t get the check stubs," Rohn said. "I have the check stubs."
Vitelco spokeswoman Katrina Comissiong said she was unaware of any lawsuit and added that if there was one, it would be "absolutely inappropriate" to make a comment.
"It doesn’t pertain to Vitelco," she said. "It would be better suited for ICC to comment."
A call to ICC spokesman Edwin Crouch was returned by an ICC employee who said Crouch was in a meeting. The employee said Crouch, who apparently misunderstood the reporter’s query, referred the matter to Daily News Executive Editor J. Lowe Davis.
Rohn, meanwhile, said she has reported her allegations to the U.S. Attorney’s Office, the PSC and the V.I. Attorney General’s Office.
And in a Dec. 7 letter to Keithley Joseph, executive director of the PSC, Donastorg again questioned Vitelco’s operations.
"We cannot overlook the fact that the salaries of these employees of these unrelated businesses are being paid directly by Vitelco – depleting this utility of the funding necessary to operate effectively," Donastorg wrote.
He also said that the alleged payroll practice and the failure to reinvest in the phone system are a "direct violation" of Vitelco’s IDC benefits.