A local man was convicted on Monday by a federal district court of tax charges relating to the operation of 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 confiscation in a specified amount at a later date.
Vuong pleaded guilty to 14 counts of wire fraud and four counts of non-payment of taxes.
Vuong oversaw the operations of two Worcester-based employment agencies, Prime Labor LLC and UT Services, Inc. Each agency paid some employees by check, but most in cash. The two agencies also failed to report or pay taxes on wages paid in cash, which Vuong fraudulently concealed in income tax returns and insurance audits. He also hid millions of dollars in cash wages that were paid to Prime Labor workers and additional cash wages paid by UT Services.
From 2012 to 2017, more than $ 30 million in checks from Prime Labor corporate clients were cashed at a check cashing business in Worcester; Prime Labor paid millions of those dollars in wages in cash and then failed to report those wages to the IRS or its insurer.
Vuong also told UT Services insurance company that the company had one employee with an annual payroll of $ 50,000 when it had dozens of employees. UT Services also distributed false insurance certificates to several corporate clients and failed to notify clients of the cancellation of its workers’ compensation policy. He also transferred operations from Prime Labor to UT Services following the execution of federal search warrants in November 2017.
Vuong is one of three people to plead guilty in connection with 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 UT Services employee, was sentenced to two years probation after pleading guilty to perjury for giving false testimony before a federal grand jury.