The Salt Lake City panel alleges those assessments were withheld from as many as 400 small businesses in Utah and Arizona, despite promises they would send the cash to the IRS.

Charges were lodged against Douglas Morby, 49, Ogden, purportedly chief executive of Provident Management Group Inc., the payroll-servicing company that had operated in American Fork, Provo, Salt Lake City and Mesa, Ariz.

Also named in the indictment were two Mesa men, Scott M. Boley, 46, the firm's president, and Robert Langford, 54, its chief operating officer.

U.S. Attorney for Utah Brett L. Tolman said business owners who use payroll servicing companies aren't relieved of their duty to pay taxes - even if something goes wrong.

"Small business that employ payroll servicing companies need to be very cautions and vigilant," he said. "Choose a reputable company and continue to monitor your tax liabilities with the IRS."

The company has not been in operation since early spring of 2003, said federal officials. The men could not be reached for comment.