A Worcester man is scheduled to be arraigned on September 11, 2019, on federal tax and insurance fraud charges arising from his role overseeing various Worcester-based employment agencies.
On August 29, 2019, a federal grand jury indicted Tam Vuong, 44, with 14 counts of wire fraud involving fraudulent reporting of workers’ compensation payroll and four counts of failing to pay taxes. Mr. Vuong had previously been charged by criminal complaint and arrested in April 2019 and has been released since that time.
Thirty million dollars in checks cashed
According to the indictment, Mr. Vuong oversaw Prime Labor LLC and UT Services, Inc., both of which were employment agencies based in Worcester. Each agency paid a few employees by check but paid most employees in cash. Each agency failed to report or pay taxes on the wages paid in cash, which Mr. Vuong fraudulently concealed in connection with tax filings and insurance audits. Mr. Vuong allegedly concealed millions of dollars in cash wages that were paid to Prime Labor workers and additional cash wages paid by UT Services. Between 2012 and 2017, more than $30 million in Prime client company checks were cashed at a check-cashing business in Worcester; Prime allegedly paid millions of these dollars in cash wages and then failed to report these wages to the IRS or to its insurer.
Falsely reported payroll to workers’ compensation carrier
In addition, while in his role overseeing and controlling UT Services, it is alleged that Mr. Vuong falsely told UT Services’ insurance carrier, the Travelers Insurance Company, that the company had only one employee and an annual payroll of only $50,000, when, in actuality, UT Services had dozens of employees and a significantly higher payroll. UT Services disseminated forged certificates of insurance to several clients and failed to inform clients when its workers’ compensation policy was canceled.
It is further alleged that Mr. Vuong shifted operations from Prime Labor Services to UT Services after federal search warrants were executed in November 2017. Mr. Vuong allegedly took steps to hide his role with both Prime and UT Services.
Possible twenty-year sentence
On the wire fraud charges, Mr. Vuong faces up to 20 years in prison, up to three years of supervised release and a fine of up to $250,000 on each count. On the tax charges, he faces up to five years in prison, up to three years of supervised release and a fine of up to $10,000 on each count. Sentences are imposed by a federal district court judge based on the U.S. Sentencing Guidelines and other statutory factors.
The U.S. Attorney, the IRS, and the Insurance Fraud Bureau involved in the case
The persons involved in announcing Mr. Voung’s indictment included United States Attorney Andrew E. Lelling; Joseph Bonavolonta, Special Agent in Charge of the FBI Boston Division; Kristina O’Connell, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; and Anthony DiPaolo, Chief of Investigations of the Insurance Fraud Bureau of Massachusetts. Assistant U.S. Attorney Bill Abely of Lelling’s Criminal Division is prosecuting the case.