A local man was sentenced in Federal District Court on Monday on tax charges related to operating an employment agency.
A federal judge sentenced Tam Vuong, 46, of Worcester, to 25 months in federal prison and ordered him to pay restitution and forfeiture in amounts determined at a later date.
Vuong pleaded guilty to 14 counts of wire fraud and four counts of failing to pay taxes.
Vuong oversaw operations at two Worcester based employment agencies, Prime Labor LLC and UT Services, Inc. Each agency paid some employees by check, but most in cash. Both agencies also failed to report or pay taxes on wages paid in cash, which Vuong fraudulently concealed in tax filings and insurance audits. He also concealed millions of dollars in cash wages that were paid to Prime Labor workers and additional cash wages paid by UT Services.
From 2012 through 2017, , more than $30 million in Prime Labor client company checks were cashed at a check-cashing business in Worcester; Prime Labor paid millions of these dollars in cash wages and then failed to report these wages to the IRS or to its insurer
Vuong also told the insurance carrier for UT Services that the company had one employee with an annual payroll of $50,000 when it had dozens of employees. UT Services also disseminated forged certificates of insurance to several client companies and failed to inform clients of cancellation of its workers’ compensation policy. He also shifted operations from Prime Labor to UT Services after federal search warrants were executed in November 2017.
Vuong is one of three individuals to plead guilty related to the two companies.
In January, Julio Lopez, a former employee of both companies, pleaded guilty to wire fraud and tax charges. His sentencing is scheduled for December 15.
Linda Le, a former employee of UT Services, was sentenced to two years of probation after pleading guilty to perjury for giving false testimony before a federal grand jury.