El Balazo Restaurant Owners Sentenced For Fraudulent Misuse Of Social Security Numbers, Employing Illegal Aliens And Tax Fraud
OAKLAND, Calif. – Marino Sandoval and his wife, Nicole Sandoval were sentenced Tuesday on various immigration, Social Security and tax charges related to the operation of their San Francisco Bay area restaurant chain, El Balazo, U.S. Attorney Melinda Haag announced.
Marino Sandoval was sentenced to 41 months in prison. Nicole Sandoval was sentenced to five years probation and 12 months of community confinement. They were ordered to pay restitution to the Internal Revenue Service (IRS) in the amount of $2,216,010.
The Sandovals pleaded guilty on Sept. 7, 2011. In pleading guilty, the Sandovals admitted to owning and operating the El Balazo Restaurants, along with Marino Sandoval’s brother, Francisco Sandoval, who pled guilty to tax charges on Aug. 30, 2010. Marino and Nicole Sandoval acknowledged that they were responsible for withholding federal taxes, including employment and unemployment taxes, from their employees’ pay. Nicole Sandoval admitted that she under reported the employees correct wages to the payroll company that the defendants used to prepare the tax returns. Marino and Nicole Sandoval admitted that, based upon their actions, the amount of employment taxes paid to the Internal Revenue Service was understated.
At the hearing, Marino Sandoval also admitted to hiring employees he knew were not legally authorized to work in this country. According to his plea agreement, between August 2007 and August 2008, Marino Sandoval employed more than 100 illegal aliens as employees, many of whom were born outside the United States. In May of 2008, agents with U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) conducted a search of several El Balazo Restaurants, during which ICE HSI agents determined there were approximately 63 employees who were unauthorized to work in the United States. After being informed by ICE in writing of the identities of the unauthorized employees, Marino Sandoval rehired more than 10 of these employees.
Aside from the tax charges, Nicole Sandoval also pleaded guilty to misusing El Balazo employees’ social security numbers that were provided to the Social Security Administration and the IRS. Between 2002 and 2007, Nicole Sandoval submitted, on behalf of El Balazo, the employer’s quarterly contribution and wage reports to the Social Security Administration. The reports included the names of undocumented alien employees receiving wages from their employment. In court, Nicole Sandoval admitted that she was aware that the social security numbers submitted were false in that they were not the social security numbers assigned to the employees as she reported.
Marino Sandoval, 59, and Nicole Sandoval, 51, of Pleasanton, Calif., were charged by criminal information on Nov. 29, 2010, alleging that they harbored and employed illegal aliens, knowingly misused employees’ social security numbers and engaged in tax fraud between 2003 and 2005.
Francisco Sandoval, 56, of Alameda, Calif., was sentenced on Dec. 8, 2010, to three years probation for failure to account and pay over payroll taxes and for harboring illegal aliens for financial gain. Francisco Sandoval was the partner and manager of two El Balazo restaurants located in San Francisco. He was also ordered to pay restitution in the amount of $50,000 to the IRS.
Stephen Corrigan and Thomas Newman are the Assistant U.S. Attorneys who prosecuted the case with the assistance of Kathleen Turner. The prosecution is the result of a lengthy investigation by the Internal Revenue Service, Criminal Investigations; U.S. Immigration and Customs Homeland Security Investigations; and the Social Security Administration, Office of Inspector General.