SCRANTON, PA — United States District Court Judge Malachy E. Mannion sentenced Madeline Nieves, age 49, of Wilkes-Barre, Pennsylvania, on October 10, 2023, to 15 months of imprisonment for conspiring to defraud the United States. Nieves also was sentenced to serve a three-year term of supervised release, following her term of imprisonment.
According to United States Attorney Gerard M. Karam, Nieves previously pleaded guilty to conspiring to evade taxes, for both her personal tax returns, and for a business that she operated. Specifically, Nieves pleaded guilty to conspiring with other individuals to defraud the IRS, from 2018 to 2020, in connection with staffing company Encore Staffing Solutions LLC, leased temporary employees to manufacturing businesses throughout Pennsylvania, and received in excess of $1.2 million in revenue. Nieves failed to withhold, report, and pay Encore Staffing Solutions LLC employee wages to the IRS. Nieves also failed to report her own personal income from Encore Staffing Solutions LLC to the IRS. The crimes resulted in a tax loss of nearly $160,000, which Nieves was ordered to pay in restitution to the IRS.
Five other individuals were previously prosecuted in this investigation:
- Mark Holmes, age 66, of Hughes Springs, Texas, pleaded guilty to accepting, as the General Manager of the Pennsylvania food services company, approximately $400,000 in bribes and kickbacks from temporary staffing companies Global Staffing Services, Inc. and Penns Independent Staffing, in exchange for hiring their employees. The two temporary staffing companies, in turn, received approximately $7,800,000 from Holmes’s employer. Holmes also pleaded guilty to failing to remit approximately $135,000 in employment taxes to the IRS that were owed by Encore Staffing Solutions LLC. Holmes awaits sentencing.
- Nari Lam, age 31, of Wilmington, Delaware, pleaded guilty to failing to remit employment taxes to the IRS. From 2016 through 2020, Nari Lam, as the owner of temporary staffing company Penns Independent Staffing, failed to pay approximately $300,000 in employment taxes owed by Penns Independent Staffing to the IRS. Nari Lam awaits sentencing.
- Danny Sing, age 60, of Philadelphia, Pennsylvania, pleaded guilty to conspiring with other individuals to evade federal income taxes for approximately $1,600,000 in wages paid by Global Staffing Services, Inc. to its employees, and to failing to withhold and remit approximately $1,360,000 in federal employment taxes to the IRS. Danny Sing and his coconspirators paid Global Staffing Services, Inc. employees in cash, paid themselves in cash, and cashed all checks received from Global Staffing Services, Inc.’s clients, to conceal the income and wages from the IRS. The criminal activities occurred between 2013 and 2020. Sing also pleaded guilty to providing in excess of approximately $400,000 in bribes and kickbacks to managers and supervisors at Global Staffing Services, Inc.’s client, to obtain business for Global Staffing Services, Inc. Sing awaits sentencing.
- Den Lam, age 49, of Philadelphia, Pennsylvania, was charged in an information alleging that he conspired with other individuals to evade federal income taxes for approximately $1,600,000 in wages paid by Global Staffing Services, Inc. to its employees. Den Lam also was charged with failing to withhold and remit approximately $1,360,000 in federal employment taxes owed, but never paid, by Global Staffing Services, Inc. to the IRS.
- Jason R. Bonnewell, age 41, of North Abington Township, Pennsylvania, was indicted by a federal grand jury with conspiring to commit honest services fraud, and filing false tax returns. Bonnewell, during his tenure as a supervisor at a Pennsylvania food services company from 2014 to 2019, allegedly accepted cash bribes and other things of value from the owners and operators of Global Staffing Services, Inc. and Penns Independent Staffing. In exchange for the kickbacks, Bonnewell and his coconspirators entered contracts with and hired the temporary employees of the two staffing companies. Allegedly, over $13,000,000 were paid to the two staffing companies, in exchange for hundreds of thousands of dollars in kickbacks. Bonnewell also was charged with three counts of filing false tax returns, for tax years 2017 through 2019, for allegedly failing to disclose the cash payments on his tax returns. Bonnewell awaits trial.
The cases were investigated by the IRS Criminal Investigations Division. The cases are being prosecuted by Assistant U.S. Attorney Phillip J. Caraballo.
Indictments and Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
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