The owners and operators of the Paragon Restaurant in Schererville have been indicted in federal court, the U.S. Attorney’s Office for the Northern District of Indiana said.

Michael McClellan, 38, of Richton Park, Ill., is charged with one count of harboring illegal aliens and three of mail fraud, the U.S. Attorney’s Office said; both McClellan and his wife, Tina McClellan, are also charged with one count of making money transactions in criminally derived property.

According to the indictment, between February 2009 and March 2010 Michael McClellan harbored illegal aliens at the Paragon Restaurant and at a home he owned located behind the restaurant. He also submitted false quarterly reports which failed to account for restaurant employees he had paid in cash in a scheme to defraud the Indiana Department of Workforce Development out of unemployment insurance tax contributions, the indictment alleges.

In addition, between 2006 and 2010 the McClellans, as owners of the T & M Daycare center, provided false information to the State of Illinois claiming certain children had attended the daycare, when, in fact, they had not, causing reimbursements of at least $200,000 from the State of Illinois and Healthy Start program, which funds they used to purchase the home located behind the Paragon Restaurant, the indictment alleges.

“Homeland Security Investigations holds employers accountable when they knowingly hire an illegal alien workforce to gain an unfair advantage over their law-abiding competitors,” said Gary Hartwig, special investigator in charge of HSI Chicago. “Our goal is to level the playing field for those businesses that p

The case was investigated by the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, the Internal Revenue Service-Criminal Investigation Division, the U.S. Department of Labor-Office of the Inspector General, the Social Security Administration-Office of the Inspector General, and the Indiana Department of Workforce Development.

Posted 11/30/2012