Construction firm owner heads to prison for multimillion-dollar IRS, insurance fraud

A 35-year-old Polk County construction company owner will spend nearly four years in federal prison for a scheme that included defrauding the IRS while skirting worker compensation laws and laws governing the employment of undocumented immigrants.

U.S. District Judge Kathryn Kimball Mizelle sentenced Mayra Velasquez, of Apopka, to three years and five months at a Tuesday hearing in Tampa. Along with serving prison time, Velasquez must pay $2.5 million in restitution and forfeit assets, including four properties in Davenport, Polk County.

According to court documents, including the plea agreement, a statement from the U.S. Department of Justice issued April 26 and previous press releases, here is what happened:

Velasquez owned Best Construction, a company that opened in 2010 and supplied construction services and labor to contractors and subcontractors.

As regular part of doing business, Best Construction was required to have workers' compensation insurance coverage on the employees the company’s clients hired.

The issue was, the workers Best was providing were mostly undocumented. Because the employees actually worked for Best, the contractors and subcontractors weren’t required to verify immigration status, assure payroll taxes were paid or that there was adequate workers comp coverage.

As part of the scheme, Best submitted applications for Florida workers compensation insurance to its insurance broker falsely stating that its estimated payroll was about $90,000. Once the company got the required coverage for that figure, it sent its proof of coverage to contractors in order to get its employees working on construction sites.

When payday arrived, the employees would be paid with money collected from contractors and subcontractors. What was happening though was that Best was cashing the payroll checks and distributing the cash to the employees, keeping a percentage of the money for itself as a fee.

In all, the plea agreement says Velazquez cashed $7 million worth of those checks.

And that’s where the trouble really began. If she had reported the true payroll amount of $7 million on her application, her workers compensation premiums would have been about $750,000 more than what she was paying.

Along with not reporting the correct amount of money and not having the proper amount of insurance as required by law, she did not deduct FICA — Medicare and Social Security — or federal taxes from employees’ pay.

The amount of unpaid payroll taxes totaled more than $1.769 million.

Velazquez pleaded guilty to one count of conspiracy to commit wire fraud and on count of conspiracy to defraud the U.S. March 9, 2022.

She was not the only one to plead guilty, though. According to a March 10, 2022 press release issued by the Justice Department, she pled guilty alongside Guillermo Inamagua, who owned a company called First Construction. The nature of the pair’s relationship is not clear, but the press release refers to them as a couple and the properties being forfeited belong to both of them, according to court records.

Inamagua, whose scheme mirrored Velazquez’s, had $4.6 million in unpaid payroll taxes and the loss to insurers was $1.5 million. In July he was sentenced to three years and 10 months in prison.  

At the April 25 hearing, the judge ordered Velazquez to surrender to federal marshals June 5 to begin her sentence. Where she will be imprisoned has not been decided.