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The operators of a temporary employment agency in Lowell MA face prison time after pleading guilty Thursday in federal court to a scheme to pay workers under the table, the U.S. Attorney's Office for the District of Massachusetts announced.
Jennifer Mileski, 36, and her common law husband, Kinh Dinh Do, 34, both of Lowell, pleaded guilty to a three-count criminal information with conspiracy, mail fraud and assisting in the preparation of false tax returns. They each face up to 28 years in prison and a $750,000 fine.
Mileski and Do operated C&A Associates, which supplied manual laborers to a graphics company. The U.S. Attorney's Office reported the company paid more than $3.4 million in cash wages, depriving the IRS of $656,414 in taxes and the company's workers' comp insurer of $77,811 in premiums.
Mileski was in charge of business finance and Do recruited workers, almost all of whom were recent immigrants, according to the U.S. Attorney's Office. The couple had from 10 to 60 workers on payroll at any given time.
The defendants paid employees in cash and routinely informed their payroll service provider that C&A had no work, and therefore no employees, according to the U.S. Attorney's Office. As a result, the payroll service provider filed more than 20 quarterly payroll tax returns on behalf of C&A reporting no payroll. The defendants also hid the number of workers from auditors for their workers' comp carrier.