Local business in limbo after payroll processing company shuts down

WATCH: Workers lose paychecks after company closes

MEMPHIS, Tenn. — A Memphis construction company is one of the hundreds of companies across the nation in limbo after a payroll processing company's sudden closure.

The FBI's Albany Bureau is investigating mypayrollhr.com after thousands of its clients had two paychecks reversed in the same week.

>>FOX13 Investigates: Thousands left in the negatives after payroll company suddenly shuts down

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Staff at the Better Business Bureau of the Mid-South said it isn't uncommon for small businesses and even some larger ones to use third-party payroll vendors like mypayrollhr.com for HR services.

"In very small businesses the owner often wears may hats and so to be able to offload your HR service, your payroll services to a third party relieves them of that responsibility to do every week," said Nancy Crawford of Better Business Bureau of the Mid-South.

Crawford said even when you do your homework, and double-check a company, something can go wrong

"Unfortunately good companies can go bad, good companies can go out of business very quickly and when that happens it leaves people in a lurch," said Crawford.

That's essentially what happened when mypayrollhr.com abruptly shut down last week.

Rowdy Legg said his company Homeway Construction signed up with mypayrollhr.com about month before the closure.

"We went with mypayrollhr because they're a huge company," he said.

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Since the payroll processing company shutdown, Legg said he hasn't heard from them except for one email saying the company couldn't process any more payroll transactions.

Now he wants to know what mypayrollhr has done with his company's money.

"Whether it be my taxes for the business and then you know federal withholding or social security you know, we gave them $7,000 who's accountable for that?" asked Legg.

Several reports say no agency regulates these kinds of companies but Legg believes the IRS needs to hold them accountable.

"If you're going to handle the facilitation of tax dollars from a private business to the government which is what they do I feel they should have some kind of regulation," said Legg.

FOX13 made several attempts to reach mypayrollhr.com and its parent company, ValueWise, for this story but neither company returned our calls.

When you're looking for a new vendor as a customer or business owner, the BBB said search the company name with complaint or review on its website to find out if they've had any issues in the past.