Pallet maker IFCO raided for employing illegal workers
Federal immigration agents Wednesday arrested seven current and former managers of IFCO Systems North America Inc., the nation's largest provider of pallet logistics services, in a nationwide sting on illegal aliens that also netted more than 1,100 of the company's employees, the Department of Homeland Security said.
The IFCO officials were charged with conspiring to transport and harbor undocumented workers, and induce them with jobs to enter the United States. The charges carry penalties up to 10 years in prison and a fine of up to $250,000 for each case involving an illegal alien.
Two other IFCO employees were arrested on charges related to fraudulent documents.
Law enforcement authorities also apprehended 1,187 illegal workers during searches at more than 40 IFCO plants and offices in 26 states, DHS said.
Houston-based IFCO specializes in supplying and managing a pool of 75 million plastic reusable containers primarily used to transport fresh produce to grocery retailers. It also manufactures and manages the distribution and return of wooden pallets used in the warehousing and transportation industry for shipping packaged goods and produce.
IFCO's Pallet Management Services division has been the subject of a year-long investigation by a task force led by U.S. Immigration and Customs Enforcement that includes New York State Police, the Social Security Administration and the Internal Revenue Service. The raid was the largest single workplace enforcement operation in U.S. history, officials said.
The investigation was trigged by a tip from a witness who said he saw IFCO workers in Guilderland, N.Y., being instructed to rip up their W-2 tax forms.
The government said in an affidavit filed in the Northern District Court of New York that IFCO officials transported illegal aliens to and from work; paid rent for the housing of illegal alien employees; and deducted money from the aliens' monthly paychecks to cover these expenses. Former IFCO employees also said it was common practice for IFCO to hire workers who lacked social security cards or produced bogus identification cards.
The affidavit alleges that about 53 percent of the Social Security numbers contained on the IFCO Systems North America Inc. payroll of roughly 5,800 workers during 2005 were either invalid, did not match the true name registered with the Social Security Administration for that number, or belonged to children or deceased persons. The Social Security Administration sent at least 13 written notices to IFCO headquarters about such discrepancies on its payroll records in 2004 and 2005, DHS said.
The Bush administration has been under fire from many quarters for not doing enough to secure the borders against the flow of illegal immigrants, which could be a conduit for terrorists to enter the country. The enforcement action is part of a new immigration enforcement strategy announced by Homeland Security Secretary Michael Chertoff Thursday, in which the administration plans to go after employers who use undocumented workers in an effort to dry up demand for workers from Mexico and other nations willing to work for low wages.
'Employers and workers alike should be on notice that the status quo has changed,' Chertoff said in a statement. 'These enforcement actions demonstrate that this department has no patience for employers who tolerate or perpetuate a shadow economy. We intend to find employers who knowingly or recklessly hire unauthorized workers, and we will use every authority within our power to shut down businesses that exploit an illegal workforce to turn a profit.'
The government is going to target investigations of illegal labor on industries that involve critical infrastructure, such as transportation, nuclear power and defense, Chertoff said at a press conference.
Federal authorities are turning away from civil penalties, which employers perceived as a slap on the wrist, and now focusing on bringing criminal charges 'when we find employers that blatantly violate worksite enforcement laws,' ICE Commissioner Julie Myers told CNN.
Chertoff said the government views organizations that systematically harbor and hire illegal workers as criminal conspiracies and will use the same strategy to put them out of business that it uses against organized crime and drug rings.
The investigation is trying to determine if IFCO executives knew about the alleged workplace violations. 'I will tell you, though, that we are troubled by some of the things that we've seen at IFCO,' Myers told CNN.
DHS has requested extra funding for immigration control and expects to add about 200 special agents, as well as auditors and other support personnel to enforce worksite rules by the end of fiscal 2007. Chertoff said a system needs to be put in place to help employers verify whether a worker is in the country legally.
IFCO Systems is based in Frankfurt, Germany.
Spokespersons for the company in Houston could not be reached. The parent company issued a statement in which it said its policy is to comply with all federal and state workplace laws and is cooperating fully with ICE to resolve the matter soon, according to CNN.