Officials from U.S. Immigration and Customs Enforcement at Sag Harbor’s 7-Eleven on Monday morning. Officials were turning away patrons from the store, which was a part of a 14-store raid across Long Island and Virginia Monday morning.
By Kathryn G. Menu
“The 7-Eleven is closed today.”
Those are the words customers attempting to enter the West Water Street, Sag Harbor business were told Monday morning by U.S. Immigration and Customs Enforcement officers. Those officers were part of a team that seized a number of 7-Eleven stores across Long Island in an investigation that resulted in the arrest of nine individuals.
The 7-Elevens stores seized in New York included franchises in Sag Harbor, Greenport, Cutchogue, Islip, Selden, Nesconset, Port Jefferson Station, Smithtown, Huntington and Islip Terrace.
In Virginia, two franchises in Chesapeake and one in Norfolk and Portsmouth were also seized in the raid.
According to the U.S. Department of Justice, two indictments were unsealed Monday charging eight men and one woman from Long Island with conspiring to commit wire fraud, stealing identities and concealing and harboring illegal immigrants employed at 7-Eleven franchise stores located throughout Long Island and in Virginia.
Sag Harbor’s 7-Eleven is owned by husband and wife Farrukh and Bushra Baig, who also owned, co-owned and controlled 12 of the 7-Eleven franchise stores in question, including stores in Cutchogue and Greenport. Both are named in the indictment.
Calls to Farrukh Baig, 57, on Monday morning were not returned.
According to United States Attorney Loretta E. Lynch, throughout the scheme the defendants allegedly hired dozens of illegal immigrants, equipped them with more than 20 stolen identities, housed them at residences they owned and stole substantial portions of their wages.
In addition to Farrukh and Bushra Baig, 49, who are listed as residents of Head of Harbor, New York, other defendants in this case include Baig’s brothers, Zahid and Shannawaz Baig, 52 and 62, respectively, both from Chesapeake, Virginia. Malik Yousef, 51, of South Setauket, Tariq Rana, 34, of Chesapeake, Virginia, and Ramon Nanas, 49, of Great River, New York are also listed as defendants. Brothers Ahzar Zia, 49, of Great River and Ummar Uppal, 48, of Islip Terrace were indicted separately and controlled two other Suffolk County 7-Eleven franchise stores.
If convicted, the defendants will face 20 years’ imprisonment on wire fraud conspiracy and alien harboring charges, as well as multiple counts of aggravated identity theft, which carries a mandatory, consecutive two-year term of incarceration. In addition, all property used to facilitate the harboring of illegal immigrants, together with all proceeds of the wire fraud conspiracy and alien harboring charges, are subject to forfeiture, according to a press release issued by Lynch on Monday.
All the defendants in the case were arraigned Monday afternoon in Norfolk and Central Islip. In Central Islip, the defendants pled not guilty and were held without bail.
According to court documents, from 2000 to the present, the defendants collectively and systematically employed more than 50 illegal immigrants at the 14 franchise stores on Long Island and in Virginia.
The defendants were responsible for using 7-Eleven’s automated payroll service, where they would input each employee’s personal identifying information and hours for transmission to corporate headquarters. Working with the data provided by the defendants, 7-Eleven processed the payroll and, after subtracting certain expenses, issued wages in the form of checks, direct deposits or debit cards.
However, rather than transmitting the true identification information of the illegal immigrant employees to 7-Eleven headquarters for processing, the defendants allegedly used more than 20 stolen identities, submitting stolen names and Social Security numbers of United States citizens to conceal the presence of illegal immigrants on the 7-Eleven franchise store payrolls.
As alleged in court documents, the victims of the identity theft hail from seven states, range in age from 8 to 78 years old, and include a child, three dead people and a Coast Guard cadet. In addition, the defendants, together with others, caused the 7-Eleven payroll service to transmit this false information, including the stolen identity information, to United States regulatory agencies, such as the Internal Revenue Service and the Social Security Administration.
7-Eleven headquarters processed the payroll and sent the employees’ wages to the defendants for distribution. The defendants then allegedly stole significant portions of the illegal immigrants’ wages, rather than paying the workers in full. The defendants also required the illegal immigrants to live in residences owned by the defendants and to pay rent in cash to the defendants.
One house harboring illegal aliens was discovered in Sag Harbor, but it is not one of the homes the government is seeking in its forfeiture action.
During the scheme, the defendants allegedly generated over $182 million in proceeds from the 7-Eleven franchise stores. Profits from those stores were shared by the defendants and 7-Eleven, according to the district attorney’s office.
According to special agent Lynda E. Interlandi, with public affairs for Immigrations and Customs Enforcement-Homeland Security Investigations (HIS), in 2010 that department received information through the New York State Police that suggested certain 7-Eleven franchise owners employed and exploited illegal aliens. In early 2011, another witness to the scheme was brought to HIS’s attention by the Suffolk County Police Department. The Suffolk County witness corroborated that information and provided additional details, accelerating the pace of the interagency investigation.
“Today the U.S. Attorney’s Office in Brooklyn announced it had filed two indictments related to alleged wrongdoing by independent 7-Eleven franchisees,” said Margaret Chabris, communications director for 7-Eleven, Inc. in a statement. “7-Eleven, Inc. has cooperated with the government’s investigation. All of our franchise owners must operate their stores in accordance with laws and the 7-Eleven franchise agreement. 7-Eleven, Inc. will take aggressive actions to audit the employment status of all its franchisees’ employees. 7-Eleven, Inc. is taking steps to assume corporate operation of the stores involved in this action so we can continue to serve our guests. We continue to cooperate with federal authorities in this matter.”
The 7-Eleven in Sag Harbor opened on Tuesday, with new staff, and is being operated by corporate headquarters.
According to officials, the indictments, arrests and seizures are the result of what is one of the largest criminal immigrant employment investigations ever conducted by the Department of Justice and the Department of Homeland Security. On Monday, federal agents were sent out across the country to execute multiple search and seizure warrants and inspect approximately 30 7-Eleven franchise stores.
According to court records, the government has moved to forfeit the franchise rights to 10 7-Eleven stores in New York and four 7-Eleven stores in Virginia. It has also moved to forfeit five houses in New York worth over $1.3 million. According to the Department of Homeland Security, the case announced today constitutes the largest criminal immigration forfeiture in its history.
“As set forth in the indictments, the defendants used 7-Eleven as a platform from which to run elaborate criminal enterprises,” said Lynch. “From their 7-Eleven stores, the defendants dispensed wire fraud and identity theft, along with Slurpees and hot dogs. In bedroom communities across Long Island and Virginia, the defendants not only systematically employed illegal immigrants, but concealed their crimes by raiding the cradle and the grave to steal the identities of children and even the dead.”
“Finally, these defendants ruthlessly exploited their immigrant employees,” added Lynch, “stealing their wages and requiring them to live in unregulated boarding houses, in effect creating a modern day plantation system. As this case shows, we are committed to preserving the rule of law and protecting our communities from the abuses of corrupt businessmen seeking to gain illegal advantage. I would like to thank our partners at HSI, New York State Police, Suffolk County Police and SSA-OIG for their hard work on this important investigation.”
“The 7-11 franchises seized today will be better known for their big fraud than their Big Gulp,” said James T. Hayes, special agent in charge with the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations New York field office. “As alleged, the franchise owners knowingly and repeatedly employed an illegal workforce and abused and exploited that workforce for more than 13 years. This charged criminal scheme had a vast detrimental effect on both the employees who were overworked and cheated out of wages, as well as the more than 25 American citizens whose lives were upended by the theft of their identities in furtherance of the scheme.”
“As alleged in the indictment, these nine individuals took full advantage of illegal immigrants through a multi-state scheme that generated millions in profits for themselves while ignoring the common decency in the employer/employee relationship,” said New York State Police Superintendent Joseph A. D’Amico. “The defendants allegedly provided the illegal immigrants with false documentation, stole significant portions of their wages and set them up in living arrangements that left the individuals completely beholden to them. I commend the unwavering dedication of the State Police Investigators who worked with our partners from federal, state and local law enforcement to make these defendants accountable for their actions.”
“As charged in the indictments, the defendants have been exploiting vulnerable individuals who, due to their immigration status, may have been afraid to come forward and report possible wrongdoing by their employers,” said Suffolk County Police Commissioner Edward Webber. “This multi-agency investigation illustrates our commitment to fighting against employers who abuse immigrant employees for their own financial gain.”
“The Social Security Number System within the Social Security Administration (SSA) tracks individuals’ earnings throughout their work history to later determine the SSA retirement benefit they have earned,” said Social Security Administration Office of the Inspector General Special Agent-in-Charge Edward Ryan. “The type of alleged actions of the individuals named in this indictment not only violates federal law, but also threatens the integrity of the Social Security Number System by causing wages to be erroneously posted to SSA’s system of records. We appreciate the cooperation of the represented law enforcement agencies here today in our ongoing initiatives to prevent fraud, waste and abuse of SSA programs.”