U.S. Department of Justice
Peter F. Neronha
United States Attorney
District of Rhode Island
June 8 , 2010
R.I. EMPLOYMENT AGENCY OWNER ADMITS UNDER REPORTING WAGES; FAILING TO PAY MILLIONS IN TAXES, SOCIAL SECURITY & MEDICARE PAYMENTS
PROVIDENCE, R.I. – The owner of a Providence, R.I., temporary employment agency pleaded guilty Tuesday in U.S. District Court in Providence to under reporting substantial amounts of wages and failing to pay between seven and twenty million dollars in federal withholding, social security and Medicare taxes. Cheang Chea, 73, owner of S&P Temporary Help Service, Inc., pleaded guilty to an information charging him with tax evasion, theft from a health care benefit program and mail fraud.
Chea’s guilty plea was announced by U.S. Attorney Peter F. Neronha and Susan Dukes, Special Agent in Charge of the Internal Revenue Service, Criminal Division – Boston Field Office. The guilty plea was entered before U.S. District Court Chief Judge Mary M. Lisi.
At Tuesday’s plea hearing, Assistant U.S. Attorney Dulce Donovan told the court, had the matter gone to trial, the government would have presented evidence that since 2003, Chea has run S&P Temporary Help Service, Inc, a Providence based company which supplied hundreds of workers to approximately 30 Rhode Island companies.
In supplying temporary employees to their client companies, S & P Temporary Help Service, Inc., agreed to be responsible for all payroll and employment tax withholdings and carry workers compensation insurance coverage for its employees. Chea’s workforce is made up of primarily East Asian, non-English speaking immigrants.
Chea is scheduled to be sentenced on October 7, 2010. He faces a maximum sentence of 20 years imprisonment, 3 years supervised release and a fine of $250,000 on the mail fraud charge; 5 years imprisonment, 3 years supervised release and a fine of $100,000 on the tax evasion charge; and 10 years imprisonment, 3 years supervised release and a fine of $250,000 on the charge of theft from a health benefit program.
The matter was investigated by the Internal Revenue Service, Criminal Division; U.S. Department of Health and Human Services, Office of Inspector General, Office of Investigations; and the U.S. Department of Labor, Office of Labor Racketeering & Fraud Investigations.