During the 2007 real estate boom, developers and large construction companies erected 40 and 50 story buildings in South Florida. There was a shortage of day laborers. Many of the construction companies hired laborers who were from Central and South America. A great deal of these persons were in the United States on visas that did not permit them to work.
A scheme was developed that shell companies would be formed that would employ the day laborers and these companies would provide the labor to the large construction companies. The large construction company paid the shell company one check. The shell company would issue numerous checks to all its employees. The shell company was formed and owned allegedly by a single individual residing in Nicaragua. The alien laborers cashed their paychecks at various check cashing stores. Most of these people did not have a social security number or a bank account.
La Bamba Check Cashing cash over $125,000,000 of the checks. The currency transaction reports reflected the name of the individual that owned the shell construction company. This person did not cash the check and was outside the country at all times. The employees arrived at La Bamba and were given envelopes containing their respective pay in currency. No income taxes were withheld. The laborers did not file tax returns.
The IRS and FBI began an investigation. They sent an independent check cashier to offer to be an agent for La Bamba. This person was given a secret 'Nanny Cam" to record his conversations with the officers of La Bamba.
Jose Chaoui was a former banker and held the position Chief Financial Officer at La Bamba. Mr. Chaoui prepared and signed all of the currency transaction reports. Mr. Chaoui was tape recorded without his knowledge discussing the preparation and filing of the currency transaction reports.
The government returned an indictment against the owner of La Bamba, another officer of the company, and Mr. Chaoui. The Assistant United States Attorney assigned met with all of the defendants and their respective lawyers. A presentation was made to convey the futility of going to trial. Mr. Chaoui's co-defendants thought the case against Chaoui was incredibly strong but they had a chance. They decided to go to trial but they wanted to distance themselves from Mr. Chaoui. The government counsel warned Chaoui that he never had so much evidence in his career and there was no way the government would loose.
The trial lasted 6 grueling weeks. The jury found the owner of La Bamba guilty. The court sentenced him to 16 years. However, the jury was deadlocked as to Mr. Chaoui. The Court declared a mistrial based upon the hung jury. It was later reported that the jury was deadlocked with 8 voting in favor of acquittal and 4 voting against. Due to juror privacy laws, this was never confirmed.
Statement of Jose Chaoui
All of my life I had worked in conservative banks. I never had any problems. Then a customer of the bank told me that he was the owner of La Bamba Check Cashing and the company was looking to hire a new Chief Financial Officer. He thought that I should apply. I applied and ultimately got the job. I never thought that the company would eventually be raided by the IRS and the FBI. Further, I never dreamed that I would be a defendant in a massive federal criminal trial facing a sentence of 20 years.
I interviewed several lawyers. They all seemed knowledgeable. My brother-in-law was a lawyer for the SEC and he accompanied me in my search. He told me that he wanted me to interview one certain lawyer last after I had met with all the others. That lawyer was David M. Garvin.
I met with Mr. Garvin last. The discussion was completely different. My brother-in-law said to me "Think of lawyers as basketball players. There are a lot of 6 foot 4 inch basketball players in the NBA. But if you need to win one game, you better get Dwayne Wade." Being from Miami, that statement resonated with me.
The trial was more stressful than I ever imagined. The government was very prepared and put on a production that was akin to a Hollywood movie. However, I can only describe David Garvin's performance as masterful. I would hear the other lawyers whisper to each other during the trial while Mr. Garvin was conducting a cross-examination: "This is incredible." During the trial that phrase was repeated over and over again. I prayed during my trial. I prayed a lot. I can honestly say that all of my prayers were answered when I prayed that I had picked the right lawyer.
If it wasn't for David Garvin, I would not be a free man today.