July 12, 2022
U.S. District Judge Kathryn Kimball Mizelle has sentenced Guillermo Inamagua of Davenport to 3 years and 10 months in federal prison for conspiracy to commit wire fraud and conspiracy to defraud the United States and the Internal Revenue Service. In addition, the court entered an order of forfeiture in the amount of $1,553,334 as well as an order for the forfeiture of two real properties in Polk County, proceeds of the wire fraud and tax conspiracies. Inamagua had pleaded guilty on March 9, 2022.
According to court documents, Inamagua owned and managed a construction company which purported to supply construction services and labor for construction contractors and subcontractors. In order to comply with Florida law, Inamagua’s company was required to secure and maintain adequate worker’s compensation insurance coverage. Inamagua’s company had agreements with contractors and subcontractors to use workers purported to be Inamagua’s employees at construction sites, and these workers were often undocumented aliens who were actually working for and under the daily supervision and direction of the contractors. Inamagua or others would then regularly receive “payroll checks” from contractors that were cashed at various financial institutions to pay Inamagua’s purported “employees” and other related expenses.
During the time period charged, Inamagua falsely and fraudulently represented in insurance applications that his company had a very limited payroll and a very limited number of employees who worked on construction jobsites. Inamagua also falsely and fraudulently sent wire communications to numerous contractors representing that his company’s employees had full worker’s compensation coverage.
In fact, Inamagua’s company received and cashed more than $19 million in checks from various construction contractors for these purported “employees.” This payroll figure far exceeded the very limited payroll figures that Inamagua had reported to his worker’s compensation insurance company. As a result, these employees—in reality, the employees of other entities—performed work on jobsites without adequate insurance coverage. In addition, the insurers lost premiums they would have charged had they been aware of the true number of workers their policies were thus being manipulated to appear to cover. The loss to those insurers was over $1,460,000 in insurance premiums that were not paid.
As a result of these misrepresentations, Inamagua’s company also disclaimed responsibility for ensuring that jobsite workers were legally authorized to work in the United States and evaded laws that required the payment of state and federal payroll taxes on behalf of these workers. Inamagua’s company did not collect or remit any such payroll taxes to the United States. Further, the contractors who actually paid these workers’ wages and used their services were able to avoid responsibility for those taxes as well. The amount of those un-paid payroll taxes totaled more than $4,670,000.
“Business owners who deliberately evade their tax and legal workforce requirements must be held accountable,” said IRS CI Special Agent in Charge Brian Payne. “Employers who intentionally deflect these obligations undermine what is owed to the U.S. government in payroll taxes and other fees, in addition to creating an unfair economic advantage over the law-abiding businesses who are operating above board.”
This case was investigated by the Internal Revenue Service – Criminal Investigation and the State of Florida Department of Financial Services. It is part of a lengthy investigation by those agencies into the use of shell companies and “ghost” employees in the construction industry. It was prosecuted by Assistant United States Attorney Jay L. Hoffer.