Overview
- Mario Flores was sentenced to eight years in federal prison after pleading guilty in March to conspiracy to defraud the United States and to operate an unlicensed money‑transmitting business, with sentencing announced this week.
- Prosecutors say Flores and others set up a series of shell companies that cashed about $89 million in construction‑sector checks from 2015 to 2022 to convert payroll into cash.
- The scheme let contractors pay workers in cash without withholding payroll taxes, which the Department of Justice estimates produced more than $38 million in losses to the U.S. Treasury.
- Authorities say Flores tried to conceal the fraud by filing false tax returns, producing fake receipt books, making false statements to IRS agents, and leasing phony workers’‑compensation certificates to contractors.
- Several co‑defendants have already been sentenced to prison terms ranging from probation to 17 years, and federal agencies including HSI and IRS‑Criminal Investigation are using the case to press enforcement against underground payroll networks.