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Date: Sept. 9, 2026
Contact: newsroom@ci.irs.gov
Jefferson City, MO – A Rocheport, Mo., woman who founded and operated Moresource, Inc. in Columbia, Mo., was sentenced in federal court today for wire fraud and failure to collect or pay over taxes.
Kathryn L. Cunningham was sentenced by U.S. District Judge Stephen R. Bough to two concurrent sentences of 18 months’ imprisonment. Cunningham had previously pleaded guilty to one count of wire fraud, and one count of failure to collect or pay over taxes. Her sentence on these two counts will be followed by three years of supervised release, and includes a $200 special assessment, as well as order of restitution in an amount to be determined by the court.
According to the plea agreement filed in the case, Cunningham’s company, Moresource, contracted with clients to calculate and disburse payroll and income taxes for the clients’ employees. Moresource would collect funds from its clients for payroll and related expenses and maintain them in an account. Moresource was also responsible for generating related tax forms for its clients.
Because this payroll account functioned like an escrow account, collecting money from clients before they were due, the account should never have been in a shortage. By January 2020, however, Moresource owed approximately $1.377 million in payroll taxes on behalf of its clients, despite having less than $400,000 in funds available in its payroll account. Ultimately, investigation revealed that Cunningham had taken funds from Moresource’s operating account and used the funds for personal expenses, had borrowed money from at least two lenders to cover shortfalls and had paid for these loans through Moresource account funds, and had obtained an SBA-guaranteed loan and an SBA line of credit to fund Moresource’s operations and payroll account. Cunningham had also requested that clients make early payments of payroll deposits in order to replace funds that she had embezzled, blaming the shortage on another client’s cash flow issues. Meanwhile, Cunningham had also stopped filing timely and accurate IRS Forms 941 and stopped making regular payments to the IRS for employment taxes owed by the clients.
This case is being prosecuted by Assistant U.S. Attorney Lauren E. Kummerer. It was investigated by IRS-Criminal Investigation and the FBI.
IRS-CI is the law enforcement arm of the IRS, responsible for conducting financial crime investigations, including tax fraud, narcotics trafficking, money laundering, public corruption, healthcare fraud, identity theft and more. It is the only federal law enforcement agency with investigative jurisdiction over violations of the Internal Revenue Code. IRS-CI has 16 field offices located across the U.S. and maintains an international presence through attaché posts abroad.