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Former Birmingham payroll exec sentenced

BIRMINGHAM (AP) — The former president of a Birmingham payroll service has been sentenced to nearly five years in prison for bank fraud and must pay more than $930,000 in restitution to his victims.

U.S. District Judge Karon Bowdre sentenced Michael
Dennis Hagen Jr. to four years and nine months in prison Tuesday.

Bowdre also ordered Hagen, who is on probation related to bad checks in Tennessee, to pay $935,733 in restitution.

"Your history is replete with lies and fraudulent activity and cheating," Bowdre told Hagen, a 1989 graduate of Decatur High School, before announcing the sentence. "It's time for that criminal activity to come to an end."

In May, Hagen pleaded guilty to defrauding banks and clients of the now-defunct American Payroll Solutions.

Some of his victims came
to Birmingham's federal courthouse from Florida and Tennessee to urge Bowdre to give him the harshest penalty available.

He faced 46 to 57 months.

Hagen pleaded guilty to depositing unauthorized checks from clients and illegally using the money credited to the account before they were presented for payment.

He failed to provide payroll services to American Payroll clients and instead spent the money, which was to be paid to government agencies to satisfy employee taxes.

Clients include Inside and Out Home Improvements in Birmingham, Guiding Light II Curves in Nashville, First Call Location Coach Rental in Orlando and Suntel in Jacksonville, Fla.

Among the banks he defrauded are Union State Bank, First Commercial Bank and Wachovia.

Copyright 2005 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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