Three El Salvadoran nationals have been handed down sentences for their roles in a significant construction payroll fraud that swindled the IRS and workers' compensation insurers out of millions. The scheme, which took place from January 2015 through August 2024, involved the manipulation of payroll systems to benefit from undocumented labor and evade due taxes, as reported by the U.S. Attorney's Office for the Middle District of Florida.
According to the U.S. Attorney's Office, Eduardo Anibal Escobar, Carlos Alberto Rodriguez, and Adelmy Tejada were sentenced after pleading guilty to conspiracy to commit wire fraud and tax fraud on April 3. Being sentenced by Senior U.S. District Judge Timothy J. Corrigan, Escobar received 4 years and 9 months in prison, Rodriguez was given 3 years and 4 months, and Tejada, having involved in convicting two insurance companies for workers’ compensation claims they hadn't committed, was sentenced to 18 months in prison alongside six months of home detention.
The court also ordered the trio to pay substantial restitution. A figure of $36,957,616 is due to the IRS for unpaid payroll taxes, with an additional $397,895 owed to two insurance companies for workers' compensation claims. Both Escobar and Rodriguez hold legal permanent resident status from El Salvador, and Tejada is a naturalized U.S. citizen from the same country.
Digging into the mechanics of their operation, the defendants, through their companies, T. Escobar Construction and C. Escobar Construction, processed payroll checks amounting to $146,077,535, allowing them to withdraw cash after taking their cut, "all without withholding, or paying over, payroll taxes to the IRS," as stated by the U.S. Attorney's Office. The construction contractors, deceived by the ruse, escaped the responsibility of verifying the legal work authorization of their labor force in the United States.
"This case highlights how federal and state agencies are working together to successfully investigate and assist in the prosecution of individuals who engage in illegal financial schemes to enrich themselves," Special Agent in Charge Ron Loecker of IRS-Criminal Investigation Tampa Field Office said. Adding to the gravity of the situation, Homeland Security Investigations Jacksonville Assistant Special Agent in Charge Tim Hemker emphasized, "These criminals defrauded the government by dodging payroll taxes and exploited vulnerable workers by not carrying proper insurance." The agencies bring to light the nefarious impacts such schemes impose on honest contractors and, ultimately, consumers, as per the U.S. Attorney's Office.
IRS-Criminal Investigation, Homeland Security Investigations, and the Florida Department of Financial Services were the primary investigating bodies in this case. The operation is part of an ongoing investigation into the use of shell companies and "ghost" employees. It was taken to court by Assistant United States Attorney Arnold B. Corsmeier, while Assistant United States Attorney Jennifer M. Harrington is handling the asset forfeiture aspect of the case.
