Thread: Restaurant owner faces seizure of assets

http://www.timesunion.com/AspStories/st ... =2/22/2006

Restaurant owner faces seizure of assets
Prosecutors might use Dragon Buffet property to repay illegal immigrants

By BRENDAN LYONS, Staff writer
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First published: Wednesday, February 22, 2006

ALBANY -- The federal government wants to seize money and other assets from the owner of six Chinese restaurants to help repay dozens of illegal immigrants whose cheap labor reaped large profits for the corrupt restaurant chain, according to federal prosecutors.
The U.S. attorney's office has moved to seize the assets, including cars, restaurants, businesses, real estate holdings and possibly hundreds of thousands of dollars, as part of a sprawling investigation of the Dragon Buffet chain, whose operators allegedly earned millions of dollars by underreporting profits and exploiting illegal immigrants.

Owner Kun Fuk "Steven" Cheng, 41, of Albany, pleaded guilty two months ago to federal charges of income tax evasion, conspiring to harbor aliens and unlawfully employing aliens. He remains free on bond until his sentencing, which is scheduled for April 10 at U.S. District Court in Albany. Cheng faces fines of at least $850,000 and up to 20 years in prison.

On Tuesday, federal authorities purchased a full-page advertisement in the Times Union listing the assets they intend to seize.

"The publication is basically required before you have an initial order of forfeiture. ... It puts third-party claimants on notice if they want to stake a claim," said First Assistant U.S. Attorney Andrew Baxter.

Federal authorities also are examining whether dozens of immigrants, many of whom were underpaid, are entitled to compensation.

"That's certainly an option," Baxter said. "Obviously, the alien employees here are victims in one sense, whether they're victims of these particular offenses is another. There are procedures to use the forfeited assets to pay restitution."

A final decision on how many assets the government can take and whether they can be used to repay victims will be determined during Cheng's sentencing.

The federal investigation started in 2003 when Immigration and Customs Enforcement agents began using surveillance to keep tabs on buffet-style restaurants from Poughkeepsie to Clifton Park.

Cheng obscured his role as operator of the restaurants, authorities said, by concealing ownership in a maze of properties, corporations and dozens of bank accounts opened in the names of friends, relatives and illegal immigrants who had no control over the cash.

In his main office at 1881 Central Ave., Cheng kept secret bookkeeping records that meticulously recorded his true receipts and expenses from each restaurant. A second set of books, which typically only recorded about 25 percent of his restaurants' receipts, was kept at each restaurant and used by Cheng to report earnings, authorities said.

When he was arrested in 2004, Cheng had more than 75 undocumented Mexican and Chinese immigrants on his payrolls. None of them were being paid overtime even though most worked 70-hour weeks, and Cheng was not paying workers' compensation or withholding taxes.

Authorities estimate Cheng owes those workers about $462,345 in back wages and overtime. The figure doesn't include dozens of immigrants "who had come and gone over the years," according to a plea agreement signed by Cheng.

Cheng's attorney, Brian Devane of Albany, said they are still negotiating with federal prosecutors on the seizure effort.

"Business operations do not have to cease and, to the extent that they are still continuing on some of the properties, they will likely stay open," Devane said.

Brendan Lyons can be reached at 454-5547 or by e-mail at blyons@timesunion.com.

They ought to seize & sell everything this creep owns. Then stick him in prison for 20 years.

What I'm not getting is why ICE will go after one situation hard, punishing one swine and then ignore the thousands of companies that are also hiring illegals, also refusing to pay taxes, paying under the table, refusing to pay overtime, keeping two sets of books to hide the lump cash payments to "subcontractors" that supposedly keeps the liability off of the main company.

Does anyone have an answer to this???

It's too easy to say that it is just for show in this one case. I mean, doesn't this case create a precedent.

OH HOW I WISH I COULD POST THIS ON THE DAY WITHOUT AN IMMIGRANT WEBSITE. But it is not interactive, unfortuneately.