SIOUX FALLS, S.D. (AP) — Prosecutors have charged four people who own and operate logging companies in the Black Hills of South Dakota with defrauding the federal government by circumventing contract requirements and employing illegal immigrant workers, U.S. Attorney Brendan Johnson said Thursday.
A federal indictment unsealed Thursday afternoon accuses Angel Munoz-Escalante, who owns and operates Munoz Logging and Construction, Aurelio Munoz-Escalante, owner and operator of Black Hills Thinning, Rogelio Escalante, who owns and operates Escalante Logging, and Sergio Munoz-Escalante, owner and operator of SM Logging, with defrauding the United States and harboring illegal immigrants.
Also indicted for harboring illegal immigrants were Barbara Munoz, Christina Pourier, Mario Rangel and Miguel Soto, who all work at the companies, and Benjamin Munoz-Botello, who owns and operates Benja's Mexican Store, a grocery store and check cashing business.
Ace Crawford, a spokeswoman for the U.S. Attorney's Office, said seven of the nine were arrested Thursday and appeared in U.S. District Court for South Dakota in Rapid City to enter not guilty pleas.
Lawyers for eight of the defendants were either not listed on the indictment, were unavailable or would not comment. John Richard Murphy, the lawyer for Sergio Munoz-Escalante, said he was pleased the judge released his client on personal recognizance.
Since about January 2008, the four logging companies conspired to defraud the government by bidding on U.S. Forest Service contracts to thin timber using illegal immigrants, the indictment said. By using illegal immigrant workers who were paid less than the prevailing wage, the companies were able to successfully bid lower than other companies — sometimes by as much as hundreds of thousands of dollars.
By employing illegal immigrants "who are not paid fair wages, benefits, and overtime as prescribed by law and as outlined in the contract, they are able to secure profits even when submitting what are much lower bids," the indictment stated.
Prosecutors said each company would often bid on the same federal contract, and when it was awarded to one of the companies, workers for the other companies would assist in completing the work.
Munoz Logging would use one person's name and direct that person to break down the check for several of the workers. The checks were cashed at Benja's Mexican Store in Rapid City because the workers did not have valid documentation, the indictment said.
Since January 2009, 23 illegal immigrants working at the companies have been arrested or deported, the indictment said.
Johnson, the U.S. Attorney for South Dakota, said the indictment shows his office's commitment to enforcing the nation's immigration laws.
"This includes limiting the demand for undocumented workers by prosecuting employers who knowingly hire illegal workers," he said in a news release.
Special agents arrested 18 people for immigration violations during the course of the investigation, according to Shawn Neudauer, spokesman for U.S. Immigration and Customs Enforcement's Homeland Security Investigations. In addition to ICE, other federal and state law enforcement agencies involved in the investigation included the U.S. Forest Service, Rapid City Police Department and the Pennington County Sheriff's Office.
Conspiracy to defraud the U.S. carries a maximum sentence of five years in custody and a $250,000 fine. Conspiracy to harbor illegal immigrants and harboring illegal immigrants is punishable by a maximum of 10 years in custody and a $250,000 fine.
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