HOUSTON - Five managers of Houston-based IFCO Systems North America have been indicted for allegedly conspiring to unlawfully employ illegal aliens. These indictments were announced on Wednesday by U.S. Attorneys José Angel Moreno, Southern District of Texas, and Richard S. Hartunian, Northern District of New York. A Houston federal grand jury returned a two-count indictment naming the five defendants on May 24. All have pleaded not guilty to the charges and have been released on bond pending trial in Houston before U.S. District Judge Gray Miller.
This case is being investigated by the following agencies: U.S. Immigration and Customs Enforcement (ICE), Social Security Administration's Office of Inspector General, the Internal Revenue Service's (IRS) Criminal Investigations, the U.S. Department of Labor's Wage and Hour Division, and the New York State Police.
These five managers were originally charged with others in the Northern District of New York in Albany. On April 1, at the request of the defendants, the case was transferred to Houston. The IFCO managers now charged in the Southern District of Texas with federal offenses relating to illegal immigration and employment-related practices are:
- Charles Davidson, 47, of San Antonio, Texas (vice president of new market development, formerly director of new market development)
- Haskell "Buddy" Ross, 43, of Lakeland, Fla. (senior vice president - human resources)
- Christopher Tiesman, 41, of Spring, Texas (senior vice president - finance and accounting)
- Kenneth Gines Jr., 52, of Spring, Texas (controller - pallet services)
- Wendy Mudra, 35, of Tampa, Fla. (human resources manager)
The investigation by ICE was initiated in February 2005, following a tip about illegal alien laborers at the Albany, N.Y., IFCO plant who were observed ripping up their W-2 forms. On April 19, 2006, ICE agents, in concert with other federal and state authorities, conducted a worksite enforcement action at more than 40 IFCO pallet plants in 26 states. ICE agents arrested 1,181 illegal aliens working at those plants. This indictment stems from the government's investigation of illegal immigration and employment-related practices by IFCO Systems.
All five defendants are accused of conspiring, between at least 2003 and April 2006, to harbor illegal aliens employed by IFCO and to encourage and induce those aliens to reside in the United States. If convicted, each defendant faces a maximum of 10 years imprisonment and a $250,000 fine. Tiesman, Gines, Ross and Mudra are charged in a related conspiracy to defraud the IRS and the SSA by submitting false payroll-related information to those agencies, and to facilitate the misuse of Social Security numbers by IFCO employees. The charge carries a maximum penalty of five years imprisonment and a $250,000 fine.
The U.S. Attorney's Office for the Northern District of New York has previously prosecuted several IFCO managers for criminal offenses associated with the employment of illegal alien workers at IFCO pallet plants. To date, 11 IFCO managers have pleaded guilty and are awaiting sentencing.
In December 2008, the Northern District of New York reached a record corporate settlement with IFCO, pursuant to which the company agreed to pay $20.7 million in civil forfeiture and penalties over four years. The settlement amount included $2.6 million in back pay and penalties relating to IFCO's overtime violations with respect to 1,700 of its pallet workers. IFCO also agreed to pay $18.1 million in civil forfeitures that will be available to support future law enforcement activities. If IFCO fully complies with the terms of the settlement agreement, the U.S. Attorney for the Northern District of New York will not pursue corporate criminal charges against the company for the conduct of its employees related to the employment of illegal alien workers at IFCO pallet plants prior to April 19, 2006.
Assistant U.S Attorneys Tina Sciocchetti and Sara Lord of the Northern District of New York, and David Searle of the Southern District of Texas, are prosecuting the case.