Firm fined $5 million in immigration case

A Southern California fence-building company and two executives pleaded guilty in federal court Thursday to knowingly hiring illegal immigrants and agreed to pay a combined penalty of $5 million, marking a rare victory for the federal government in prosecuting employers for immigration crimes.

Golden State Fence Co. pleaded guilty to the charge as a misdemeanor and agreed to pay $4.7 million to the federal government. It admitted hiring illegal workers between January 1999 and November 2005.

Mel Kay, 64, the company’s chairman and president, and Michael McLaughlin, 42, manager of the company’s Oceanside office, pleaded guilty to the charge as a felony. Kay agreed to pay a $200,000 fine, and McLaughlin agreed to pay a $100,000 fine.

The men, who admitted hiring at least 10 illegal immigrants, were released on their own recognizance.

U.S. District Judge Barry Ted Moskowitz set sentencing for March 28.

U.S. Atty. Carol Lam said the government would recommend terms on the low end of the six to 12 months established in federal sentencing guidelines. The maximum is five years.

Richard Hirsch, attorney for Golden State and Kay, said they pleaded guilty to close the matter.

“People slip through the cracks, and that’s what happens,” Hirsch said outside court. “Mistakes were made.”

Julie Myers, assistant secretary for the U.S. Department of Homeland Security, said in a statement that the “settlement and guilty plea clearly show that employers who knowingly and blatantly hire illegal workers will pay dearly for such transgressions.”

Jail time is unusual in such cases, and the fines were thought to be among the largest. Last year, Wal-Mart agreed to pay $11 million to end a federal investigation into employment of illegal immigrants at stores in 21 states.

It is extremely rare for a company to be criminally charged with hiring illegal immigrants, said Steven Camarota, research director of the Center for Immigration Studies in Washington, a group that advocates tighter immigration controls.

The plea deal comes the same week as a sweeping workplace crackdown on illegal immigrants.

On Tuesday, federal agents raided meat-processing plants in six states as part of what they called an investigation into the stealing and selling of identity documents so illegal immigrants can get jobs.