Did agency use illegal workers in state?
By JAMES WALSH, Star Tribune

August 9, 2008

Three years ago, Doris Ruiz was a champion of matching businesses desperate for workers with immigrants desperate for jobs.

Her Minneapolis-based Olen Staff Co. was placing hundreds of mostly Mexican-born workers with employers from Ashland, Wis., and Blackduck, Minn., to the Twin Cities. She served on Minneapolis Mayor R.T. Rybak's Latino Advisory Committee, and last year she and her husband opened a restaurant in the city, Lúcuma, that channelled their business success into the flavors of Colombia and Peru.

Today, Lúcuma is dark, its cases empty. Olen Staff Co. is closed, its telephone disconnected. And Ruiz and her husband, David Rivera, are the subject of an investigation by the IRS and the U.S. Immigration and Customs Enforcement for allegedly placing illegal immigrants with employers and not paying taxes for them or Ruiz for three years.

Ruiz has not been charged with a crime. And federal officials won't comment on the allegations. Ruiz, Rivera and the companies that used their services also have declined to comment or not responded to interview requests. But, if true, the government's allegations would present a large local example of a national problem.

Staffing agencies using illegal immigrants are widespread across the country, officials say, including recent cases in Chicago and Memphis. Larger employers often use subcontractors and employment companies so they can avoid checking workers' documentation or withholding payroll taxes.

"It gives them plausible deniability," said Claude Arnold, special agent in charge of ICE in Minnesota. "There's a lot of a wink and a nod."

Investigating Olen

Ruiz, 36, a native of Peru, started Olen Staff Co. in 2001. According to a search warrant affidavit filed in federal court, Olen Staff Co. has "primarily employed persons who have illegally entered or are illegally present in the United States. These persons are placed by Olen Staff Co. in work assignments with other companies."

The affidavit states that Ruiz and Rivera "have facilitated, concealed and derived substantial income from this employment of illegal aliens."

The Star Tribune featured Ruiz and Olen Staff in a May 2005 story highlighting her work to bring immigrant workers to Anderson Fabrics in Blackduck, Minn. The story talked about how Olen Staff's employees were enriching the town and schools -- and Olen Staff. By going outside the Twin Cities, Olen Staff saw its sales grow from $400,000 in its first year to $715,000 in 2005, with workers employed in everything from food processing to landscaping. Ron Anderson, president of Anderson Fabrics, called Ruiz "quite an entrepreneur."

But in January 2006, according to the affidavit, an anonymous informant called ICE, claiming Olen Staff employed more than 100 illegal workers, made false green cards on company computers, paid workers in cash and withheld taxes from their wages but did not pay them to the government.

So the feds began investigating.

A search of company records found that from 2002 to 2004, Olen Staff Co. employed 136 people and had a cumulative payroll of $720,000, according to the affidavit. Yet the Social Security Administration found that in 2003 and 2004, more than 85 percent of the Social Security numbers were false.

After Olen Staff was told about the false numbers, the company simply stopped filing tax returns. It has not filed payroll reports, W-2 statements and tax returns since 2004, according to the affidavit.

Yet, according to bank records for just part of 2005, Olen Staff Co. was paid nearly $200,000 by a number of area companies, including Felling Trailers in Sauk Centre, the Plastics Group in Maple Grove and Johnson Brothers Liquor Co. in St. Paul.

At the same time, Ruiz was making regular transfers of just under $10,000 from Olen Staff accounts to her personal accounts, according to the affidavit. And she was making regular withdrawals from her account of just under $10,000, the affidavit said. Withdrawals of $10,000 or more are reported to authorities.

Bank records show that deposits totaling more than $200,000 continued to Olen's accounts from June 2007 through January 2008.

According to the affidavit, the names of 15 companies were found in an Olen Staff Co. computer file under "references." They included Jennie-O Turkey Store, the Minneapolis Convention Center and Gertens Nursery in Inver Grove Heights. Minneapolis officials say they can find no record of hiring Olen Staff for the Convention Center, although a spokesman said it is possible a subcontractor could have hired them. Officials with the other companies either did not respond to interview requests or declined to comment.

Pat Solheid, vice president of human resources for Jennie-O, wrote in an e-mail: "It has been many years since we have used their services. It is our policy not to comment on pending litigation."

Transporting illegal workers

In May 2006, a sheriff's deputy in Carlton County pulled over a Mercedes Benz going north on I-35W near Scanlon, Minn., for excessive window tinting. Ruiz and three other adults were in the car.

Ruiz said she was taking three employees to a work assignment in Ashland, Wis.

The U.S. Border Patrol was called and questioned the workers, who were in the country illegally. The workers said that when they went to Olen Staff, they told Ruiz that they did not have identification documents and "Doris told them that was OK," the affidavit states.

In June 2006, the Border Patrol interviewed another Olen worker after he had been convicted of battery in Ashland. The man was in the country illegally and worked at Anna Marie Designs in Ashland with 12 to 15 other Olen employees. He said Ruiz had set them up in an apartment there and deducted their rent from their pay.

During a July 2006 undercover operation, a confidential informant posing as a job-seeker met with Ruiz and told her he had no legal documentation. Ruiz nonetheless made plans for him to work at Anna Marie Designs. According to the affidavit, Rivera drove the man to Ashland and left him in an apartment there.

Officials with Anna Marie Designs declined to comment.

Warrant executed

On the morning of June 20, investigators with ICE and the IRS executed search warrants at a south Minneapolis duplex, which is home to Ruiz, Rivera, her four children and Olen Staff Co. Neighbors watched and the children looked on as investigators removed boxes of files and computers.

Since then, an Olen Staff van parked in front of the duplex has not been moved. For the past few weeks, neighbors say that Rivera has been showing up at the duplex for short periods late at night or early in the morning. Ruiz has dropped out of view. Lúcuma, the restaurant Ruiz and Rivera opened in September 2007, has been closed for more than a month.

Reached at the duplex one morning last week, Rivera said: "I talked to our lawyer and he told me not to answer any questions."

Monica Romero, a business consultant who works primarily with Hispanic business owners and vaguely remembers meeting Ruiz, said she knows that some may feel pressure to circumvent the law when starting their own businesses.

And, she said, she doesn't ask what someone's immigration status is before agreeing to help them. But she added: "We work very hard on convincing business owners to be socially responsible. And that means you need to do your job. You need to do your documentation."

She added: "I don't know what Doris did or did not do. But I ask my clients, 'Please, please don't mess up with the IRS or with Minnesota Revenue.'"
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