Jesus Jose Mendez plead guilty to defrauding the IRS of more than 2 million dollars.
Mendez and his business partner, Jamie Zambrano, used check cashing businesses to cash more than 600 business checks totaling more than 16 million dollars from 2013 to 2017. Mendez and Zambrano cashed checks in Rhode Island and then took backpacks full of cash to construction sites, where they paid day laborers in cash. They were under surveillance at the time.
They had a small number of employees on legitimate payroll, but the rest were paid under the table, eliminating the need to pay employment taxes.
Mendez is awaiting sentencing and Zambrano is on the run. The IRS estimated the federal tax loss at $2,821,463 and the Massachusetts
Department of Labor calculated the loss of unemployment contributions at