Illegal Immigrant Gets Eight-Year Prison Sentence for $89 Million Payroll Tax Fraud Scheme

The Department of Justice announced on Thursday that Mario Flores, an illegal immigrant from Honduras, was sentenced to eight years in prison for fraudulently cashing $89 million in a payroll scheme between 2015 and 2022, which involved employing other illegal immigrants working in the United States. Flores also filed false tax documents with the IRS to avoid detection of his illegal financial scheme. He was sentenced on Wednesday.

Court documents show that while in the country illegally, Flores created multiple shell companies to create and manage an “unlicensed check cashing and cash courier service business.” Over the course of seven years, Flores’s scam companies cashed checks from construction industry workers totaling around $89 million, while also charging these workers a percentage of the check’s value as a fee for doing so, according to the DOJ.

Flores’s scheme enabled construction contractors who ran the companies to pay employees in cash without filing and paying the required payroll taxes. Records show that, altogether, it resulted in “a total loss to the United States of more than $38 million,” according to the Department of Justice.

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In addition to defrauding the government with phony payment records and an illegal check-cashing company, Flores’s scheme “facilitated the employment of illegal aliens working in the United States,” noted the Department of Justice. He also defrauded insurance companies with fake workers’ compensation claims through “providing false and fraudulent information to the insurers about … the number of workers covered by the insurance and the amount workers were paid.”

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