Federal agents arrested the father-son owners of 15 Chuy's Mesquite Broiler restaurants in Arizona and California on Wednesday on allegations they were knowingly hiring illegal immigrants and paying them under the table.
Mark Evenson, 58, of Paradise Valley, and his son, Christopher Evenson, 39, of Oro Valley, were arrested along with the company's accountant, Diane Strehlow, 47, of Tempe.
They face a variety of criminal charges including unlawful hiring and harboring of illegal immigrants, conspiracy to defraud the Internal Revenue Service and tax evasion, said Vincent Picard, Immigration and Customs Enforcement spokesman.
Agents from Immigration and Customs Enforcement and the Internal Revenue Service served search warrants at four Chuy's in Tucson, seven in Phoenix and four in California, said Rick Crocker, ICE deputy special agent in charge in Tucson. Search warrants were also presented at two houses in Tucson and three houses in Phoenix.
The arrests are the culmination of a two-year investigation that began with an anonymous tip that Chuy's was hiring illegal immigrants, Crocker said. The Evensons hired illegal immigrants to work in the kitchens of 15 Chuy's restaurants in Arizona and California, paying them off the books to avoid paying taxes, he said.
Agents also arrested 40 illegal immigrants they encountered Wednesday at Chuy's locations in Arizona and California, including 18 in Tucson, Picard said. They are facing administrative immigration charges. But they weren't the focus of the investigation, Crocker said.
"Our goal is not just to round up illegal aliens," Crocker said. "What we want to do is target the employers. We are trying to send a message that we are not going to tolerate this."
If convicted, Mark Evenson could face up to 86 years in prison and a $5.3 million fine. His son could face up to 81 years in prison and a $5 million fine. The accountant, Strehlow, could face up to 40 years and a $2 million fine. The three will be arraigned today in federal court in Tucson.
The company paid the illegal-immigrant workers by check and did not report their earnings in the quarterly federal tax returns, the indictment shows. The company has failed to pay at least $400,000 in Federal Insurance Contribution Act (Social Security and Medicare) taxes since January 2008, the indictment shows.
"That provides an unfair commercial advantage for Chuy's," Crocker said.
The Evensons hired legal workers to be servers and perform other front-of-the-restaurant jobs and paid them through regular payroll practices. The illegal workers were hired for the kitchen, the indictment says.
Crocker said investigators are confident they've gathered sufficient evidence to prove in court that the Evensons "knowingly" hired the illegal-immigrant workers. That's a requirement of federal law for an employer to be found guilty.
In November 2010, Mark Evenson instructed an employee preparing payroll that the restaurant did "cash" for the back help, the indictment says. "If those Social Security numbers get in the state, they'll come pick them up," Mark Evenson said.
After receiving a complaint about illegal workers at a Lake Havasu City Chuy's in September 2010, Mark Evenson told an employee, "If we throw some American people in there, maybe that'll just shut (them) up," the indictment says. He told the employee, who he believed was an illegal immigrant, "I just need to get you off the oh, show floor. I need to hide you in the kitchen."
When an employee told Christopher Evenson in August 2010 that a person he wanted to hire who was working at another restaurant had "no papers," Christopher Evenson told the employee that the other restaurant did "the same thing," the indictment says.
Dating to 2008, the Evensons hired about 360 illegal immigrants to work at the 11 Chuy's in Arizona, the indictment alleges. The younger Evenson, Christopher, was primarily responsible for the Chuy's locations in Tucson, the indictment says..
The Chuy's locations in Tucson run by the Evensons are located at:
• 3100 E. Speedway.
• 7585 S. Houghton Rd.
• 4499 W. Ina Rd.
• 6310 Tanque Verde Rd.
The Chuy's on East 22nd Street at South Kolb Road has a separate franchise owner and was not involved in the investigation, said owner J. Brian Latta.
Latta came to Arizona from California with Mark Evenson to start the chain but the business associates parted ways in 2003. "I hope it doesn't hurt my business," Latta said.
Did You Know
In May 2010, Chris and Mark Evenson agreed to pay $40,000 to settle a federal copyright lawsuit stemming from songs being played without permission.
Contact reporter Brady McCombs at 573-4213 or firstname.lastname@example.org