An accomplice in the MyPayrollHR scheme that defrauded local banks was sentenced Wednesday to 6 years in prison.

Derek R. Schwartz, 55, of Texas, had pleaded guilty in September 2023 to one count of conspiring to commit wire fraud and four counts of wire fraud.

Schwartz was an associate of Michael T. Mann, of Clifton Park, who was the CEO of ValueWise – one of Mann’s subsidiary companies.

The company obtained millions of dollars for his companies based in New York and Colorado, such as MyPayrollHR, by falsifying the amount of income that was coming into the business. Mann created fake invoices to represent the receivables.

Schwartz admitted to conspiring with Mann to convince another employee, Luke Steiner, to attest that the fake invoices were real, the U.S. Attorney’s Office said.

Schwartz also must serve three years of post-release supervision and pay nearly $13 million total to the two financing companies. He must pay $2,000 per month while in prison. Schwartz already has made $1 million in restitution.

Mann was sentenced in 2021 to 12 years in prison on federal charges. He got another 8 to 24 years on state charges.

Steiner received two years of probation and was required to pay nearly $13 million in restitution.

The business shutdown caused more than a thousand small businesses across the country to have to scramble to pay employees.