Former Payroll Services Executive John Visconti Arrested

The former CEO of Axium International is accused of siphoning millions of dollars from the company before it went bankrupt.

John Visconti, the former CEO of Axium International, was arrested for taking millions of dollars from the Hollywood payroll-services company before it went bust in 2008.

Authorities said that 71-year-old Visconti was arrested Monday by IRS agents when he appeared at a courthouse on an unrelated matter. He was arraigned on a three-count indictment and pleaded not guilty later that day, and then he was freed on $100,000 bond.

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Authorities allege that Visconti and a "co-conspirator" -- whom they identified only as another former officer of Axium -- took weekly cash payments of about $8,000 a week from Axium for two years and formed a consulting company that billed Axium for $570,000, but didn't disclose they were profiting from the arrangement.

It is further alleged that Visconti arranged for thousands of dollars paid to an Axium employee to be cycled back to a bank account controlled by Visconti.

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Visconti is charged with conspiracy, tax evasion and filing a false tax return. If he is convicted on all three counts, he will face a statutory minimum sentence of 13 years in federal prison. A trial is set for July 29.

Axium filed for bankruptcy in January 2008, and many of its assets were acquired by Entertainment Partners for $7.05 million a month later. EP also acquired some of Axium's former clients and hired some of its employees.