⏱ 2 min read
Rene Mauricio Escobar, 55, and Juana Nelida Escobar, 36, two Orlando residents, have been sentenced for their role in a massive $148 million construction payroll scheme that defrauded the IRS and workers’ compensation insurers. The scheme, which lasted from December 2015 to August 2024, involved paying construction workers ‘off the books’ to avoid paying payroll taxes and workers’ compensation insurance premiums. The Escobars, through their company Escobar Plastering, enabled hundreds of construction subcontractors to obtain contracts with construction contractors by providing false certificates of insurance.
The scheme also facilitated the employment of undocumented workers who were not legally authorized to work in the United States. In exchange for 7% to 8% of the subcontractors’ payroll, the Escobars caused certificates of insurance in the name of their company to be sent to construction contractors, representing that the subcontractors worked for their company and were covered by their workers’ compensation insurance. However, the company’s insurance policies were based on applications representing that the policies would cover only a handful of employees and minimal payroll.
Rene Escobar was sentenced to four years and nine months in federal prison, while Juana Escobar received a two-year prison sentence. The court also ordered the defendants to pay $37,174,388 in restitution to the IRS for unpaid payroll taxes. Juana Escobar, a legal permanent resident from Mexico, is likely to face deportation from the United States following her conviction.
The case was investigated by the IRS and the FBI, and was prosecuted by the U.S. Attorney’s Office for the Middle District of Florida. The sentencing was handed down by U.S. District Judge Wendy W. Berger, with U.S. Attorney Gregory W. Kehoe announcing the outcome.
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📋 Key Facts
- Crime: Fraud & Financial Crimes
- Defendant: Florida
- Location: US
- Source: DOJ Press Release
