2 Hondurans made Florida shell companies to employ undocumented workers
2 plead guilty to helping construction companies avoid taxes, workers' comp
JACKSONVILLE, Fla. – Two Honduran citizens have pleaded guilty to creating shell companies in Central Florida that allowed construction contractors and subcontractors to hire mostly undocumented aliens and skirt paying payroll taxes and workers' compensation insurance, federal prosecutors announced Thursday.
Anyi “Angie” Artica-Romero, 32, and Milton Noel Romero, 35, both of Orlando, have pleaded guilty to conspiracy to commit wire fraud, the U.S. Attorney's Office said.
Both are Honduran citizens who do not have legal status in the United States, and each faces up to 20 years in federal prison.
As part of their guilty pleas, both have agreed to forfeit $812,149, the amount of proceeds obtained as a result of the offenses, and $127,624 that was seized in cash and from bank accounts.
According to the plea agreements, Artica-Romero and Noel Romero helped undocumented aliens living and working illegally in the United States to find employment in the construction industry.
Construction contractors and subcontractors entered into an agreement with shell companies controlled by Artica-Romero and Noel Romero to provide workers, most of whom were undocumented aliens, prosecutors said.
By obtaining and paying the workers through the shell companies, the contractors and subcontractors could avoid responsibility for ensuring that (1) the workers were legally authorized to work in the United States, (2) required state and federal payroll taxes were paid, and (3) adequate workers’ compensation insurance was provided, according to prosecutors.
After creating the shell companies, Artica-Romero and Noel Romero applied for workers’ compensation insurance policies covering the period from Sept. 2, 2015, through July 27, 2017, prosecutors said.
In the applications, they represented that the policies would cover six to 19 employees, and estimated annual payrolls of $100,000 to $410,800. The insurance companies issued policies with annual premiums of $20,002 to $38,860, based on the payroll information in the applications.
They then “rented” the insurance policies to numerous construction contractors and subcontractors who employed hundreds of workers, causing the insurance companies to send certificates of insurance to the contractors and subcontractors as purported proof of sufficient workers’ compensation insurance, prosecutors said.
The contractors and subcontractors wrote payroll checks to the shell companies for work performed by the workers. Artica-Romero and Noel Romero cashed the checks and distributed the cash to construction crew leaders, who then paid the workers in cash. No state or federal payroll taxes, such as for Medicare and Social Security, were deducted from the workers’ pay, in violation of Florida and federal law, prosecutors said.
Artica-Romero and Noel Romero kept approximately 4 percent of the amount of each payroll check as a “rental” fee, prosecutors said. During the scheme, they cashed payroll checks totaling $20,303,737, with the 4 percent fee totaling $812,149. The annual premium for a workers’ compensation insurance policy covering a payroll of $20,303,737 would have been more than $2,800,000.
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