Prosecutors: Meat supplier hired illegal immigrants, cheated on taxes
By David Ibata
The Atlanta Journal-Constitution
4:06 p.m. Wednesday, February 22, 2012
Three owners of an Atlanta company that supplied meat to restaurants around the Southeast were sentenced to prison Wednesday after they admitted hiring at least 12 illegal immigrants and paying wages off the books so they could avoid more than $300,000 in federal taxes.
Rhett Maughon, 49, and Marcus Maughon, 47, brothers who live in Decatur, were sentenced to five and three years in prison, respectively. Rafael Villarreal Sr., 42, of Suwanee, was sentenced to five years in prison followed by detention proceedings with Immigration and Customs Enforcement.
“The defendants’ unwritten business ‘success’ plan for Atlanta Meat Company included cutting legal corners by hiring undocumented workers and evading federal taxes, in part by ensuring that the cash they received in their business never made it to their accountant’s books,” U.S. Attorney Sally Quillian Yates said in the news release.
Prosecutors said that from early 2001 until June 2006, the three men and two others not named in the indictment jointly owned the Atlanta Food Authority, doing business as Atlanta Meat.
Some customers paid cash, prosecutors said. The defendants didn’t record all the cash received on the company’s books and used the cash to pay themselves and their employees’ wages.
Most of their employees were paid partly by cash and partly by check, some were paid entirely in cash, and many were illegal immigrants not authorized to work in this country.
The cash payments were not reported in the company’s quarterly filings with the government, resulting in the deliberate underpayment of employee withholding taxes. The defendants also didn’t report the cash they paid themselves on their personal tax returns for 2005 and 2006.
On Oct. 13, two days into their federal trial, Rhett Maughon and Villarreal each pleaded guilty to conspiracy, while Marcus Maughon pleaded guilty to filing a false individual income tax return for 2005.
U.S. District Judge Thomas W. Thrash Jr. handed down the sentences, “the maximum sentence of imprisonment authorized by law,” prosecutors said in the news release.
They also were ordered to pay individual restitution on their personal income taxes -- Rhett Maughon, $126,390; Marcus Maughon, $126,979; and Villarreal, $129,606 – and joint restitution of $312,639.75 for Atlanta Meat’s employment tax liabilities from January 2003 through September 2006.
Additionally, each man was ordered to serve three years’ supervised release, and the Maughons must each perform 100 hours of community service.
Prosecutors: Meat supplier hired illegal immigrants, cheated on taxes *| ajc.com
