Founder of Hayward transport for disabled embezzled $4.6 million

Dublin resident Shiv Kumar, 60, pleaded guilty in an Oakland courtroom Friday to embezzling millions of dollars from his Hayward business that provides transportation to disabled people. Dublin resident Shiv Kumar, 60, pleaded guilty in an Oakland courtroom Friday to embezzling millions of dollars from his Hayward business that provides transportation to disabled people. Photo: James Steidl / James Steidl Photo: James Steidl / James Steidl Image 1 of / 1 Caption Close Founder of Hayward transport for disabled embezzled $4.6 million 1 / 1 Back to Gallery

The president of an East Bay transportation company that provides rides for disabled people pleaded guilty Friday in an Oakland courtroom to filing fraudulent business tax returns to conceal more than $4.6 million that he used as spending money, federal prosecutors said.

Dublin resident Shiv Kumar, 60, who founded A-Paratransit Inc. in 1996, according to the company’s website, filed the fraudulent returns with the IRS for tax years 2009 and 2010, according to the U.S. District Attorney’s Office for the Northern District of California.

The $4.6 million in embezzled money caused a tax loss of more than $1.5 million to the IRS.

Under the terms of his plea agreement, Kumar admitted to one count of making and subscribing a false income tax return.

His attorney declined to comment, and the company did not return a request for comment. Kumar was still listed as the company’s president on its website Friday afternoon.

From its founding by Kumar more than two decades ago, A-Paratransit has grown to operate more than 200 vehicles and employ more than 250 workers, according to the company’s website.

Its fleet of large, white vans and buses have features to accommodate riders in wheelchairs and those with other disabilities.

Kumar admitted to creating three bank accounts — at Bank of America, Bank of the West and U.S. Bank — that he did not disclose to his accountant, where he funneled millions in gross receipts from the business without reporting it.

Gross receipts for a business are total revenue without subtracting certain tax-deductible costs or expenses.

Each account was held in the name of the business, but Kumar exercised sole control of the accounts, he said in his plea agreement. He was also the sole shareholder of the company.

Kumar used the accounts to funnel the money into two investment accounts and spent it on his family, including purchasing real estate in Vallejo.

Under the terms of the plea agreement, Kumar received credit for previous back payments to the IRS, meaning he will have to pay about $260,000 in back taxes.

He is scheduled to be sentenced on July 7 and faces up to three years in prison and a fine of $250,000.

Michael Bodley is a San Francisco Chronicle staff writer. Email: mbodley@sfchronicle.com Twitter: @michael_bodley