Thread: Two Get Prison Time For Hiring Illegals

http://www.sun-sentinel.com/news/palm-b ... 2183.story

Two get prison time for creating shell companies to hire illegal aliens
Pair evaded employment taxes

Palm Beach (Palm Beach, Florida) By Wayne K. Roustan, Sun Sentinel

10:05 p.m. EDT, September 3, 2010
Two executives of Sun Deck Concrete Inc., in Riviera Beach, were sentenced on Friday for setting up shell companies to hire illegal aliens as laborers to avoid paying employment taxes, according to the U.S. Attorney's Office.

Company President John M. David and supervisor Juan A. Gonzalez pleaded guilty on June 16 before U.S. District Judge Kenneth A. Marra in West Palm Beach.

David was sentenced to a year and four months in prison and two years on probation while Gonzalez was sentenced to 10 months in prison with two years on probation.

The defendants also were ordered to pay $479,906 restitution, which David paid in full before sentencing, according to court records.


Prosecutors say that between 2005 and 2006, David and Gonzalez set up fake companies as subcontractors through which they hired more than 20 Mexican and Honduran workers who were living in Florida illegally.

To make the shell companies appear legitimate, other co-conspirators opened corporate bank accounts, obtained federal tax identification numbers and purchased fraudulent workers' compensation insurance policies for the companies, according to court documents.

"It's a very intricate, complex scheme. It's not an accident," said Maj. Geoffrey Branch, with the Florida Department of Financial Services, Division of Insurance Fraud.

"They have to incorporate, get an insurance policy, and find a check-cashing store to cash the checks," Branch said.

More than $2 million in cash wages was funneled through the shell companies to conceal the fact Sun Deck was employing illegal workers and to avoid the payment of employment taxes and workers' compensation premiums for these workers, according to court records.

"Due to the volume, a check cashing store would have to be in cahoots with this type of scheme," Branch said.

David would approve checks payable to the shell companies for the workers' wages, and approve additional money to cover kickbacks to the co-conspirators and supervisors and fees to the check-cashing store, authorities said.

As a result, David defrauded the Internal Revenue Service out of $316,254 in employment taxes and avoided the payment of $163,652 in workers' compensation premiums due to Bridgefield Employers Insurance Co., prosecutors said.

"[Setting up subcontractor shell companies] is the prevailing scheme to avoid the payment of workers' compensation," Branch said. "Especially in the construction industry."

More prosecutions are expected in this case.

Good to hear one judge is upholding the law!!! Shame the judge that heard the Arizon case was not standing up for the American people!!

Originally Posted by Bobby12

Good to hear one judge is upholding the law!!! Shame the judge that heard the Arizon case was not standing up for the American people!!

you are 100%Right