Lakeland Check Cashier Sentenced For Role In Fraud Conspiracy

LAKELAND, FL — U.S. District Judge Mary S. Scriven has sentenced Raju Gandhi, 60, of Lakeland to 18 months in federal prison for conspiracy to defraud the U.S. Department of the Treasury, to commit wire fraud and to submit false statements and reports to the U.S. Department of the Treasury.

The court also entered an order of forfeiture for more than $3.6 million, the estimated proceeds of this multi-pronged fraud conspiracy. Gandhi pleaded guilty on Sept. 23, 2021.

According to court documents, Gandhi owned and operated a money service and check cashing business in Polk County where he cashed large numbers of checks made payable to a number of shell construction companies that claimed to supply construction services and labor for construction contractors and subcontractors.

To comply with Florida law, these shell construction companies, which had agreements with contractors and subcontractors to use workers on construction sites, were required to secure and maintain adequate worker’s compensation insurance coverage.

However, according to the Department of Treasury, these workers were often undocumented immigrants who were actually working for and under the daily supervision and direction of the contractors themselves.

These shell construction companies regularly received “payroll checks” from the contractors that were cashed at various financial institutions to pay the “employees” of these shell construction companies.

According to court records, the owners of these shell construction companies falsely and fraudulently represented in insurance applications that their companies had a limited payroll and a limited number of employees who worked on construction job sites. They also sent wire communications to numerous contractors representing that their companies’ employees had full worker’s compensation coverage.

In reality, these shell construction companies provided no real labor force at all but received and cashed more than $147 million through Gandhi’s check-cashing business in Lakeland.

The Department of Treasury said Gandhi was aware of this scheme and hid his activity by falsely under-reporting fees that he had collected for cashing those contractor checks to the Department of Treasury. These checks were made payable to the shell construction companies from various construction contractors who, in fact, actually supplied the labor force for the jobs.

As a result, these employees performed work on job sites without adequate insurance coverage, said the department. In addition, the worker’s compensation insurance companies lost the higher premiums they could have charged had they been aware of the true number of workers their policies were being manipulated to cover.

Due to these misrepresentations, the shell construction company owners said they were not responsible for ensuring that job site workers were legally authorized to work in the United States and for paying the required state and federal payroll taxes on these workers’ wages.

he contractors who actually paid these workers’ wages and used their services were also able to avoid responsibility for paying those taxes as well.

“Money service businesses are a critical component to the nation’s financial system particularly amongst the unbanked and underbanked population. MSB owners and operators have a responsibility to the community to provide fair and transparent services to their customers” said Homeland Security Investigations Assistant Special Agent in Charge John Dumas. “HSI, alongside our state, local and federal law enforcement partners will aggressively investigate and support the successful prosecution of those who operate outside of, or turn a blind eye to, the law for their own personal enrichment.”