3 years later, little to show for raid on Chuy's Mexican restaurants

Daniel González, The Republic | azcentral.com 8:45 a.m. MST May 8, 2014

http://www.gannett-cdn.com/-mm-/9329...6000-chuys.jpg
(Photo11: Mark Henle/The Republic)

On the morning of April 20, 2011, a dozen federal agents in bulletproof vests and with guns drawn swarmed Mark Evenson's Paradise Valley home.

Evenson, a paraplegic, was taken away in his motorized wheelchair wearing handcuffs as his wife and daughters looked on.

At the same time, dozens of other federal agents from Immigration and Customs Enforcement and the IRS raided many of Evenson's nearly two dozen Chuy's Mexican restaurants in Phoenix, Tucson and California, carting away boxes of evidence in front of television cameras.

"I was in awe and shock," Evenson said.

Federal officials characterized the Chuy's raid as a major work-site enforcement case. The case drew national attention as an example of the Obama administration's growing crackdown on employers of illegal immigrants.

Evenson and his son,Christopher, who ran the chain's restaurants in Tucson, were charged in a 19-count indictment with knowingly hiring hundreds of illegal immigrants as kitchen workers and then defrauding the IRS by not withholdinghundreds of thousands of dollars in employment taxes.

Chuy's bookkeeper Diane Strehlow was charged with falsifying IRS employment tax forms under the direction of Mark and Christopher Evenson.

The two Evensons each faced more than 80 years in prison and more than $5 million in fines, ICE officials said at the time. Strehlow faced up to 40 years in prison and $2 million in fines.

But three years later the Chuy's case has all but fizzled, leaving the federal government with little to show for years of resources spent investigating and prosecuting the case.

In November, Strehlow, who cooperated with prosecutors, was sentenced to one year of probation and no fine after pleading guilty earlier to a felony charge. In exchange, she agreed to testify against the Evensons.

She never got the chance.

Charges dismissed

In January, a federal judge dismissed all of the charges against Mark Evenson after doctors determined he was not mentally competent to stand trial because of brain damage he received in a 2004 car accident that left him paralyzed. The charges were dismissed without prejudice, and therefore could be refiled.

In April, Christopher Evenson pleaded guilty to two of the original 19 counts: conspiracy to impede and impair the function of the IRS, and engaging in a pattern and practice of hiring illegal aliens. He is scheduled to be sentenced on July 21. He faces up to five years in prison, $250,000 in fines, and up to $3,000 for each illegal worker. But under the plea agreement, Christopher Evenson could receive no more than six months in prison with probation.

Now, Mark Evenson is speaking out.

He believes his arrest was trumped up for political purposes, placing him in the middle of a dispute between President Barack Obama's administration and Arizona Gov. Jan Brewer.

In staging the massive raid, Evenson believes the federal government was trying to counter Brewer's claims a year earlier that she had to sign the SB 1070 immigration-enforcement law because of "federal inaction" in securing the border and enforcing immigration laws.

The federal government later filed a lawsuit against Arizona to stop the law from taking effect.

"The government was having trouble with Arizona so they made poster boys out of me and Chris," Evenson said. "The government was using me as a target to say, 'Hey, we are all about immigration (enforcement) as well.' "

Instead of a high-profile raid, ICE could have taken a different approach, Evenson said, like auditing his payroll and working with him to fix any problems.

"Because the way they went about it in the media it made it look like we were bad people," Evenson said.

Amber Cargile, an ICE spokeswoman in Phoenix, disputed Evenson's claim.

The agency initiated the investigation after ICE investigators in Tucson received a tip in January 2009 from a Chuy's employee about work-site and financial violations at the company, she said.

In a written statement, ICE officials also said that in 2009, the agency shifted its work-site enforcement strategy to focus on the arrest of employers, rather than solely on employees.

Hiring undocumented immigrants gives "unscrupulous employers a competitive edge over law-abiding businesses that play by the rules and pay prevailing wages and benefits," the statement said.

Since the start of fiscal 2009, ICE work-site investigations have resulted in the criminal indictment of 868 management officials nationwide and 787 convictions, the statement said.

Is program effective?

Jessica Vaughan, a director at the Center for Immigration Studies,said ICE's work-site enforcement has not been effective.

The agency rarely raids employers, she said, and the criminal convictions that result are often minimal because the agency has backed off from arresting undocumented workers who can help build cases against employers, she said.

None of the 42 undocumented immigrants ICE encountered working at Chuy's restaurants was criminally charged.

"It seems like (the Chuy's case) is turning out to be a waste of resources," said Vaughan, whose group favors tough immigration enforcement. "If they are not able to make a case stick, there is no deterrent effect for the employers."

Christopher Evenson, 42, of Oro Valley, declined to be interviewed.

Strehlow, of Tempe, could not be reached for comment.

Strehlow's lawyer, A. Melvin McDonald, said she had worked for Chuy's since 1997 and was hired by Mark Evenson to establish "clean bookkeeping methods."

It was under Mark Evenson's direction that some employees were paid in cash, and those employees were not paid time and a half for overtime hours since they were already "avoiding paying taxes on their income," McDonald wrote in court papers filed prior to Strehlow's sentencing.

The cash employees included immigrants in the process of obtaining legal status, and some U.S.-born employees who preferred cash to "avoid taxation," McDonald wrote.

In 2009, after the company began losing money, Mark Evenson directed restaurant managers to pay more employees in cash to help cut costs, McDonald wrote.

The indictment further accused the Evensons of using different payment methods for legal and illegal workers. Legal workers hired as servers were paid with payroll checks that deducted taxes, the indictment said.

Illegal workers were paid with checks written by store managers without deducting taxes, the indictment said.

The indictment said the Evensons employed about 360 illegal immigrants at Chuy's restaurants in Arizona.

In an interview with The Arizona Republic, Mark Evenson denied knowingly hiring illegal workers or paying workers in cash to avoid taxes.

He also denied directing others to do so.

His lawyer, Dan Cooper, said that before the charges against Mark Evenson were dismissed, Evenson had planned to go to trial.

As part of Evenson's defense, Cooper planned to show that Evenson was not capable of making decisions about hiring and firing because of a brain injury. He acknowledged there were undocumented immigrants working at the restaurants.

"I have no doubt that someone who hired them knew they were illegal, but Mark was not at fault," Cooper said. "Plenty of other people were running the company."

Life-changing events

Evenson, 61, said he spent his life building the Chuy's chain after starting as a bus boy in the restaurant industry after high school and working his way up to a regional manager for other chains.

He opened his first Chuy's in 1989 in Carpinteria, Calif., a beach town near Santa Barbara. The restaurant featured citrus-marinated chicken grilled over mesquite and a surfer atmosphere. The restaurant was named after a surfer buddy nicknamed Chuy who gave Evenson the chicken recipe.

"It was so popular, people would come from Bakersfield, Oregon, Arizona and Texas," Evenson said.

Evenson then expanded to other cities in California, then to Arizona. Eventually he opened seven restaurants in Tucson, where he is from; seven in the Phoenix area; and several in Kingman, Prescott and Lake Havasu.

At the time of the raid, he owned 14 restaurants in Arizona and nine in California.

Evenson said the raid badly hurt his business. The restaurants had to hire inexperienced workers to replace the illegal workers taken away during the raid. Quality declined while the new workers learned their jobs, so many customers stopped coming, he said.

He now owns only two restaurants in California and one in Tucson. Two other Chuy's in Tucson are franchises.

He said he also had to sell his home in part because of financial difficulties caused by the raid and in part because of medical bills from his accident. He now rents an apartment in Phoenix with his wife, Jeanine.

The raid, Evenson said, "wiped me out financially. Here I was a guy who built a business off of my bootstraps. I turned it into a big business. I did it all on my own and the government because of political reasons took it all away."

http://www.azcentral.com/story/news/...chuys/8837597/