LINCOLN — It was a far-reaching scheme involving eight members of one family, a cook at a Mexican restaurant, several businesses, multiple towns and three states, authorities say. Those accused include business owners, human resource managers and bank tellers.
Officials wiretapped phones to gain evidence about the alleged conspiracy to provide illegal labor to businesses while siphoning off the workers’ pay for added profit, a federal prosecutor said.
But defense attorneys on Thursday said their clients committed no crimes, arguing that some of the claims in a federal indictment could be equated to renting a home to someone or providing a ride to work, just providing those services to people who are here illegally.
Eleven people named in the scheme pleaded not guilty to charges against them in federal court Thursday afternoon. Another four will appear in court Friday, and two were not in custody as of Thursday evening.
Of the 17 alleged co-conspirators, seven face two charges — money laundering and harboring illegal aliens. Three businesses also are listed with those charges in the indictment. Ten people only face the harboring charge, which carries a maximum of 10 years in prison. The punishment for money laundering is a maximum of 20 years in prison.
Officials described the operation as one of the largest in Homeland Security Investigations’ 15-year history.
Federal agents served search warrants Wednesday in and around the Nebraska towns of O’Neill, Ainsworth, Bartlett, Royal and Stromsburg and in Las Vegas and Minnesota. Officials also arrested 133 workers suspected of being in the country illegally.
Officials said the accused ringleaders, Juan Pablo Sanchez Delgado, Magdalena Castro Benitez and Antonio De Jesus Castro, created two companies that provided illegal labor to businesses in Nebraska, Minnesota and Nevada. One official with Immigration and Customs Enforcement equated the conspiracy to “slave labor,” saying many workers had to pay fees to get jobs.
Ross Pesek, an attorney representing Delgado and Benitez’s business, JP and Sons LLC, said in a statement that the case is “political prosecution.”
“Today’s indictment accuses a father of criminally harboring his daughter, husbands of criminal harboring their wives and bank tellers of laundering money by cashing checks,” the statement said. “This indictment and yesterday’s raid are a dramatic escalation of the criminalization of being Latino. Today the destruction of a small town and dozens of families is being called a success by ICE. But time will reveal it as morally bankrupt and shameful.”
Delgado and Castro provided names and Social Security numbers for the workers, knowing that they could not work legally in the United States, according to the federal indictment. They also transported the workers and provided housing to hide the operation from ICE officials, the documents allege.
Almost a dozen listed in the indictment allegedly agreed to “warn each other about possible enforcement actions” by ICE. According to court documents, John Good, who was among those indicted, told Delgado and Benitez on June 21 about possible ICE presence and suggested that they close their La Herradura restaurant to avoid detection.
Seven of Delgado’s family members, including his wife, son, siblings and in-laws, were listed in the indictment.
Good and four others who appeared in court Thursday were released by U.S. Magistrate Judge Cheryl Zwart, but they must report to pretrial services, stay in Nebraska unless they have permission to leave and surrender their passports.
They are allowed to speak to other defendants only for work or family reasons, she ruled.
“If you do talk about this, whatever you say, somebody else can use against you later,” she said. “So everybody keep your mouth shut.”
Dave Domina, who is representing Good, said after the hearing that Good is 73 years old and a well-regarded, lifelong resident of Holt County. Domina said they will fight the charges at trial.
“We don’t believe a crime was committed,” Domina said. “He did whatever he did to be a decent person, for no financial gain or profit.”
The five who were released were four U.S. citizens, including Good, and Mayra Jimenez, a Mexican immigrant who has lawful permanent residence, otherwise known as having a green card.
Jimenez’s husband, Juan Pacheco Jimenez, said he was relieved that the judge allowed Jimenez to be released to be with their four children.
“It’s really, really important that she come back home,” he said.
The other six were detained because they might flee or obstruct justice, Assistant U.S. Attorney Lesley Woods said. Most of the six detained were in the country illegally, but one woman had legal status given to people brought illegally into the United States as young children.
“In recorded phone calls, defendants talk about leaving the state and fleeing the country in order to avoid (charges),” Woods said.
A man who declined to give his name but said he was the son of one of the indicted women, Lillian Ajin, said his mom is not a criminal. She has lived in O’Neill for about eight years and was a stay-at-home mom, he said. He said he doesn’t know how she is connected to the other defendants in the case, which he called “false information.”
“Have you gotten your parents taken away? It’s hard to explain,” he said when a reporter asked how he was feeling. “(ICE) treated her like garbage.”
Assistant U.S. Attorney Lesley Woods classified the case as complex because of the amount of evidence involved and added that investigators looked through thousands of pages of financial documents.
Prosecutors will have 30 days to disclose all evidence to defense attorneys, who then have another 30 days to look over the information before the next hearing Oct. 10. Detention hearings for some of the defendants will be on Tuesday.
On the money laundering charge, court documents allege that Delgado would withhold money from the workers’ paychecks, claiming it was for federal taxes, then keep the money for himself. More than $8 million in transactions were conducted by Delgado’s company accounts at Great Western Bank.
A spokeswoman for Great Western Bank, which is based in Sioux Falls, South Dakota, said the bank doesn’t comment on legal or personnel matters or on investigations. The bank hasn’t been contacted by authorities, but if it is, the bank will “fully cooperate,” she said.
“It is important to know that GWB has complied with all applicable laws and regulations relating to its customers and its employees,” said Ann Nachtigal, the spokeswoman.