Thread: PA-Car Wash Empire Throws in the Towel

Car wash empire throws in the towel

By Bob Fernandez
Philadelphia Inquirer Staff Writer

Mace, the pepper-spray giant, took a bath after diversifying - and using undocumented workers.

Nicholas Sama, a heavyset 51-year-old former car wash operator, placed his hands in prayerful meditation and looked up and said, "Thank you, Jesus."

U.S. District Judge Mary A. McLaughlin had just sentenced Sama to five years' probation, with the first nine months in home confinement, and fined him $10,000 for his role in a conspiracy to employ dozens of undocumented Mexican workers at four Philadelphia-area car washes.

He faced a maximum of five years in prison.

Sama's Thursday afternoon sentencing was the latest plot twist in the 10-year saga of Mace Security International Inc., of Horsham, the pepper-spray dispenser that improbably - and disastrously - diversified into car washes.

Mace, which at one time sought to operate the nation's largest chain of car washes, has sold off all but 12 washes, and its stock is trading at about $1 a share. To resolve the Mexican-worker case, Mace paid the government $600,000 in penalties and forfeitures.

But Mace's problems are far from resolved. Mace general counsel Robert Kramer will be sentenced Tuesday before U.S. District Judge C. Darnell Jones II in the government's undocumented Mexican-worker sting.

Kramer pleaded guilty to one misdemeanor criminal charge. Court documents say he had "constructive knowledge" of the scheme to employ undocumented workers, or should have known about it. He faces a maximum sentence of six months in prison and a $150,000 fine.

Paul Kazaras, a legal-ethics expert with the Philadelphia Bar Association, said Kramer could be disciplined as a lawyer because the federal Clerk of Courts will report the guilty plea to the Disciplinary Board of the Supreme Court of Pennsylvania. Kazaras said there were no set rules on what the board could do.

James Becker, Kramer's attorney, said Friday that his client had no "actual knowledge" of hiring undocumented workers. He noted that the only area of the country where Mace had the undocumented-worker problem was in Sama's region in the Philadelphia area. Sama was a regional manager and reported to Kramer.

In a statement Aug. 12, Mace said Kramer was an important employee who failed "to discover the conspiracy orchestrated by the regional manager, and managers of the four car washes. The Company supports Mr. Kramer's decision to conclude the unfortunate episode by the guilty plea. The Company believes that Mr. Kramer is a valuable employee who provides a positive contribution to the Company."

Company spokesman Don Taylor did not comment beyond the statement and said Mace's 12 remaining car washes were for sale.

The unusual Mace saga was born in the late 1990s, when Philadelphia businessman Louis Paolino Jr., who made a fortune in trash hauling, thought car washes were ripe for consolidation.

Mace, on the other hand, was stuck in the slow-growth pepper-spray business and was looking to diversify. Paolino sold the Mace board on the car wash idea, invested in the company, and became its chief executive officer. Paolino established the company headquarters in South Jersey and hoped to acquire about 10 percent of the 17,000 tunnel car washes in the United States.

But growth did not come easily. Car wash volumes varied with the weather, and customers were demanding. Then there was the matter of finding people to manage the washes, and to dry and detail the cars. Car wash managers felt pressure to operate the washes on budget.

Tipped off by a former Mace employee, federal immigration and labor investigators raided Mace car washes in Bryn Mawr, Norristown, Flourtown, and Cherry Hill in March 2006 and found 50 undocumented Mexican workers. They represented 90 percent of the nonmanagement workforce at the four washes.

Car wash managers were assigning Social Security numbers of former Mace employees to Mexican workers, court documents state. In this way, the undocumented workers were hidden from the payroll officials at the Mace corporate offices, then located in Mount Laurel.

The undocumented workers cashed checks in other peoples' names through an informal arrangement with Mace's bank branches near the car washes. Bank tellers identified Mace workers by company T-shirts.

The scheme operated between 2000 and March 2006, so the number of undocumented workers was likely higher than the 50 caught on one day in March 2006, officials say.

In all, the government nabbed six Mace employees - Sama, Kramer, and four car wash managers. Sama and the four car wash managers pleaded guilty to felony charges, and Kramer pleaded to the lesser misdemeanor charge. Kramer is the only one still working at Mace.

The prosecutor, Assistant U.S. Attorney Judy Goldstein Smith, declined to comment.

In a brief phone interview Friday, Paolino said: "I'm in serious litigation with the company, and I really can't comment." He departed from Mace 18 months ago and "I don't know anything," he said. He asked what sentence the judge gave Sama.

On Sept. 3, Lee Gordon, one of the former car wash managers, appeared in McLaughlin's court in a black suit and combed-back hair for his sentencing. He told the judge he was sorry for his actions. His father and attorney said he was working in a diner to pay bills.

"I don't mind seven days a week," Gordon told the judge. "It's hard and it's not rewarding, but it's honest work." Gordon hugged his attorney when he learned he wouldn't go to prison.

http://www.philly.com/philly/business/h ... towel.html

This is a duplicate but it bears repeating.

It makes me so angry that businesses hire illegals over American citizens.

Not long ago, I told a friend of mine that I wanted to hire someone to help my senior parents clean their apt. once a week. I live in a different state and can't get down there every week. My friend said she had three women from Mexico that cleaned her house and they worked hard for next to nothing. I blew my cool and screamed at my friend" Don't you realize the "real" cost of hiring illegals over Americans?â€