Father, son owners of Chuy's arrested on federal immigration, tax charges

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by Catherine Holland

azfamily.com

Posted on April 20, 2011 at 1:04 PM

Updated Wednesday, Apr 20 at 6:13 PM

PHOENIX – The father-and-son team that owns Chuy’s Mesquite Broiler will be in federal court Thursday to face charges of tax and immigration violations.

Mark Evenson, 58, of Paradise Valley, and Christopher Evenson, 39, of Oro Valley, along with one of their accountants, Diane Strehlow, 47, of Tempe, all face a variety of criminal charges, including the unlawful hiring of undocumented immigrants, conspiracy to defraud the IRS, and tax evasion.

The charges are laid out in a 19-count indict that came from a lengthy investigation by U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HIS) and the Internal Revenue Service (IRS).

If convicted Mark Evenson faces up to 86 years in prison and a fine of $5.33 million. Christopher Evenson could get up to 81 years in prison and a $5.08 million fine. Strehlow faces up to 40 years in prison and a $2 million fine.

“For nearly two years, these defendants are alleged to have knowingly dodged hundreds of thousands of dollars in taxes in order to maintain an illegal workforce,” said U.S. Attorney Dennis K. Burke in a news release. “That deceitful practice, which hurts all law-abiding tax payers and employers, must stop. There should be no place in our economy for employers who cynically exploit and defy the U.S. tax code to take advantage of illegal labor.”

According to the indictment, the Evensons knowingly hired undocumented immigrants to staff the kitchens of their restaurants while hiring legal employees for the more visible positions. The undocumented workers were allegedly paid “under the table” so no taxes were withheld or reported to the IRS. The legal workers were paid via normal payroll procedures.

“Employers who knowingly hire an illegal workforce encourage illegal immigration, take jobs away from legal workers and gain an unfair advantage over their competitors,” said Matt Allen, special agent in charge of ICE HSI in Arizona, in a news release. “This case should be a reminder about the consequences facing employers who exploit illegal alien labor and violate our nation’s laws. No employer, regardless of size, industry, or location is above the law.”

According to ICE, Mark Evenson himself allegedly told employees not to run the personal information of employees who were undocumented immigrants through the government because the government would “come and pick them up.”

The pattern allegedly continued when Mark Evenson allegedly told an employee that “throwing some American people in there” might curb complaints about undocumented immigrants working at the Lake Havasu City location.

Chris Evenson is accused of similar actions.

When advised that a potential new hire who was already working at another restaurant was illegal, Chris Evenson allegedly said the other restaurant did “the same thing.”

Both Evensons and Strehlow were arrested Wednesday when agents with HIS, the IRS and the Department of Labor executed 20 search warrants, 15 of them at Chuy’s restaurants in Arizona and California.

The indictment indicates that the Evensons began filing fraudulent quarterly tax returns some time before January 2008 and continued doing so for the next two years. That means the restaurant’s management company failed to pay at least $400,000 in Social Security and Medicare taxes.

“Employment tax evasion undermines public confidence in our tax system and businesses that don’t follow the rules have an unfair advantage over their competitors,” said Dawn Mertz, special agent in charge, IRS Criminal Investigation, in a news release. “Tax evasion is not a victimless crime and results in the loss of future Social Security or Medicare benefits for the employees and loss of tax revenue to the United States government.”

The case is being prosecuted by the U.S. Attorney’s Office District of Arizona.

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