Thread: Cleaning service chiefs eyed years ago in hiring illegals

http://washingtontimes.com/national/200 ... -5359r.htm

Cleaning service chiefs eyed years ago in hiring illegals
By Jerry Seper
THE WASHINGTON TIMES
February 26, 2007


Three executives indicted last week in a fraud and tax scheme in the hiring of hundreds of illegal aliens nationwide were first targeted by federal authorities at least two years ago, suspected of recruiting laborers from Mexico, Honduras and Guatemala to work at Michigan businesses.
Federal investigators, including prosecutors Hagen W. Frank and Matthew G. Borgula, initially focused on a spate of fraudulent green cards showing up in Grand Rapids, Mich., eventually finding their way to Rosenbaum-Cunningham International Inc. (RCI), a Florida-based contractor that supplied janitorial workers for theme restaurants and hospitality venues nationwide.
One of RCI's customers was the Grand Traverse Resort & Spa near Traverse City, Mich., which agreed to cooperate in the federal probe.
Last year, federal law-enforcement authorities said, the prosecutors linked an illegal alien arrested by police in Grand Rapids for possessing fraudulent documents to a state employee, Juanita Schlagel. She pleaded guilty to selling phony green cards and led investigators to an RCI official.
The prosecutors targeted RCI in a scheme to recruit illegal workers nationwide, give them phony immigration documents and pay them in cash. They said owners Richard M. Rosenbaum and Edward Scott Cunningham wired money to company subordinates for the workers to be paid in cash to avoid federal reporting requirements.
"RCI encouraged and induced aliens who were employees to reside illegally in the United States so that RCI could operate more profitably," Mr. Borgula said in a complaint used to seize money from RCI bank accounts.
In August, the government filed four separate forfeiture cases seeking more than $2.1 million worth of real estate from Mr. Rosenbaum, Mr. Cunningham and RCI Controller Christina Flocken. Mr. Borgula asked for a stay in the forfeiture proceedings while prosecutors further built their criminal case.
"It is highly likely that the criminal investigation into the violations ... may result in criminal charges," Mr. Borgula said in the filing. "The United States anticipates that the investigation of this matter will be completed within six months."
On Thursday, nearly six months to the day, a federal grand jury indicted Mr. Rosenbaum, 60, of Longwood, Fla., Mr. Cunningham, 43, of West Palm Beach, Fla., and Mrs. Flocken, 59, also of Longwood, on charges of conspiracy to defraud the United States and to harbor illegal aliens for profit, harboring illegal aliens for profit and evading payment of federal employment taxes.
More than 200 illegal aliens were apprehended during raids last week in 17 states at 63 locations -- including the Hard Rock Cafe, ESPN Zone, Planet Hollywood, Dave & Busters and the House of Blues restaurants.
The indictment said restaurant chains and hospitality venues paid RCI $54.3 million for janitorial services from 2001 to 2005 and that by failing to collect and pay federal income, Social Security, Medicare and federal employment taxes on the wages it paid to its work force, RCI was able to evade payment of $18.6 million in employment taxes.

Three sentenced in illegal immigrant tax scheme
Judge orders them to forfeit millions derived from their illegal activities
By Sally Apgar

South Florida Sun-Sentinel

March 5, 2008

A West Palm Beach man was sentenced Monday to more than four years in prison and ordered to pay $16 million in unpaid taxes for his role in a nationwide tax scheme that employed illegal immigrants as janitors to clean for restaurant chains like Hard Rock Cafe, Dave & Busters and Yardhouse.

Scott Cunningham, 44, the former vice president of Rosenbaum-Cunningham International (RCI), was sentenced to four years and three months by U.S. District Court Judge Paul Maloney in Grand Rapids, Mich.

Along with Cunningham, the company's former president, Richard M. Rosenbaum, 61, of Longwood, was sentenced to 10 years and ordered to pay $16.9 million. A third defendant, Christina A. Flocken, 60, who once served as RCI's controller, was sentenced to 2 1/2 and ordered to pay $15.7 million.

Maloney also ordered the three to forfeit bank accounts, life insurance policies and cash totaling more than $3 million that prosecutors said was derived from their illegal activities. Cunningham is expected to forfeit a home in the gated community of Ibis Golf and Country Club.

In handing down the sentence, Maloney said the crimes involved a "massive tax scheme involving illegal aliens."

Assistant Secretary for Homeland Security Julie L. Meyers said, "For too long, unscrupulous employers like those who owned and operated RCI have been able to undercut their competition by building their work force with illegal labor."

Myers added that "targeting employers who profit from illegal hiring is a key component to stopping illegal immigration."

Prosecutors said that between 2001 and 2005, RCI was paid more than $54 million and evaded $15.7 million in federal taxes.

In February 2007, the three were charged in a 23-count indictment with conspiracy to defraud the United States, evading federal employment taxes and harboring illegal immigrantsfor profit. If convicted on all charges, they each faced 15 years in prison.

Just before the indictment was handed down, more than 200 undocumented workers from Mexico, Honduras, Guatemala and Haiti were rounded up in a raid on 63 RCI job sites across the country, according to the U.S. Immigration and Customs Enforcement. They were detained pending deportation proceedings.

After a plea agreement was reached in November 2007, Cunningham and Flocken pleaded guilty to charges of conspiring to defraud the government and harboring illegal immigrants. Rosenbaum reached a similar agreement in October 2007.

The indictment said that illegal immigrants were "essential to the success of their scheme" because they were willing to be paid in cash, could be fired without legal recourse and were "highly unlikely to report the irregular nature of their employment."

www.sun-sentinel.com

Do this with every company employing illegal aliens. Jail the owners/managers, seize all their assets and company assets and employers may think twice about exploiting illegals and ripping off taxpayers. In addition, if illegals know there are no jobs for them here AND no social services, they will not sneak in.