ICE Charges Donut Maker with Glazing Over Immigration Rules

The filing of federal charges was announced last week against Houston, Texas-based Shipley Do-Nut Flour and Supply Company Inc. and Shipley Properties Inc., the company's president, and three former and current managers. A guilty plea is anticipated by the company to the felony offense of conspiracy to harbor aliens. The three former and current managers are expected to appear before a U.S. Magistrate on Friday.

The charges against the donut maker arose from a criminal investigation initiated by the Immigration and Customs Enforcement (ICE) in January 2008 after learning about allegations in a federal employment discrimination lawsuit, then pending in the Houston Division of the Southern District of Texas. Part of ICE's investigation into the company included interviews with civil plaintiffs, many of whom were illegal aliens, and thorough review and analysis of civil suit pleadings, I-9 Employer Review and Verification Forms, and Social Security Administration No-Match letters. I-9 forms require an employer to establish an employee's identity and verify his or her employment eligibility at the time of hire. SSA No Match letters are sent to employers when reported Social Security numbers on W-2 forms do not match known social security numbers.

The criminal information alleges that in April 2008, more than 40 percent of the company's workforce were illegal aliens, the majority of I-9s were deficient or completed years after an illegal alien began working for the company, and that the company failed to take corrective measure to ensure the company hired workers authorized to work in the United States after receiving SSA No-Match letters. As part of its investigation, ICE agents recovered 42 No-Match letters sent by the SSA which placed the company on notice that the aliens did not have a valid social security number.

After the April enforcement action, the company took measures to revise its immigration compliance program to ensure the company had new procedures in place to prevent future violations of federal immigration law, including hiring an outside consultant to advise the company on immigration compliance.

Shipley, through its president, is expected to plead guilty to the conspiracy charged in count one of a "criminal information." If the court accepts the guilty plea and the plea agreement, the company faces a maximum fine of $500,000 and up to five years probation at sentencing. In addition to any sentence imposed, the company, as part of its agreement with the United States, has taken measures to revise its immigration compliance program and agreed to begin implementing new procedures to prevent future violations of federal immigration laws. The company has also agreed to pay $1.334 million to the United States in lieu of the United States forfeiting the company's interest in the various company-owned residences where illegal alien employees were housed.

The company president pleaded guilty before a U.S. Magistrate to the charge of continuing to employ illegal aliens as alleged in count three of the criminal information. During that hearing, the president admitted that since March 2005, when he became president of the company and responsible for overseeing, managing, and supervising the various operations of the company including personnel decisions, he wrote and signed two letters on behalf of two employees he knew to be unauthorized to work in the United States and continued to employ them. He faces a maximum of six months imprisonment and a fine of up to $3,000 per unauthorized alien employee.

The current warehouse supervisor for the company is charged with continuing to employ illegal aliens. The former and current warehouse managers for the company are charged with hiring illegal aliens. The criminal information cites one occasion in November 1998 when the former warehouse manager allegedly provided a false social security number to an alien which was one number off from his own. The criminal information also alleges that in December 2007 an illegal alien--who was also a minor--told the current warehouse manager he had fake documents when he was hired. Each charge carries a maximum punishment of six months imprisonment and a $15,000 fine.

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