Illegal kickbacks for foreign farm workers in Minnesota bring a federal fraud conviction

In the nation's first criminal prosecution of work-visa fraud, an Ohio woman has been convicted in a conspiracy that required foreign laborers at a Minnesota farm to pay illegal fees and kickbacks.

A federal jury in Minneapolis took less than four hours Monday to convict Sandra Lee Bart, 68, of Seven Hills, Ohio, after a trial that began Aug. 1.

Bart and a co-defendant recruited mostly agricultural employers — including the Svihel Vegetable Farm in Foley, Minn. — to hire employees from the Dominican Republic, then forced the workers to pay kickbacks and cover their own travel costs.

Officials say the case was the first work-visa fraud case that federal prosecutors charged criminally since a 2009 law change that required employers to certify under penalty of perjury that they would not collect fees from workers.

Assistant U.S. Attorney Manda Sertich said the decision "should serve as a warning to those who seek to exploit foreign workers through the U.S. guest worker visa programs."

Bart's lawyer said her client intended no harm to the Dominican workers. "Sandra Bart is a good person. She made mistakes," attorney Piper Kenney Wold said. "Her primary goal was to bring impoverished people to the U.S. to work to improve their lives. She did that."

Among three defendants indicted, Bart was the only one to go to trial. The family-owned Svihel Vegetable Farm was also indicted last year, but prosecutors dismissed charges in a June plea agreement with its owner, John James Svihel, 54.

According to court documents, Bart's scheme grew from a lawn management company she ran in Ohio, where she began hiring employees on temporary work visas, also called H-2A visas. She and an employee, co-defendant Wilian Socrate Cabrera, created an unregistered business called Labor Listo, through which Cabrera recruited workers from his hometown of Navarrete in the Dominican Republic. The two recruited workers for Bart's company and later for other businesses, including Svihel's farm, a landscaping firm in Kentucky and farms in Florida, Wisconsin, Missouri and North Dakota.

Like Svihel, Cabrera pleaded guilty to conspiracy to commit fraud in foreign labor contracting in July, and both men are cooperating with the government.

Federal regulations covering H-2A visas prohibit employers from collecting recruitment fees or wage kickbacks. Employers must also pay housing and travel expenses to and from their workers' home countries, but Cabrera collected travel costs from workers, according to court documents.

Svihel told authorities that he agreed to employ four workers from the Dominican Republic at his farm for the 2010 growing and harvesting season, from May to October. The number of Dominican H-2A workers on Svihel's farm grew from four in 2010 to 68 in 2014 and 53 in 2015, according to court records.

Bart falsely claimed to Svihel that a Dominican church or charity paid for the workers' travel, while the employees actually had to cover their own airfare. Svihel also pocketed roughly $90,000 in kickbacks from the workers that Bart ordered after the wage Svihel was required to pay workers increased in 2011.

The Dominican workers were also charged recruitment fees that ranged from $420 to $2,385, and an annual fee of $375 that Bart and Cabrera split. If they didn't pay, workers were told, they would not be rehired at the 500-acre farm for the following growing season.

The U.S. Labor Department's investigation into the scheme began with an anonymous tip regarding working conditions in summer 2014. While interviewing workers, investigators learned of the illegal fees. The extra scrutiny prompted Svihel to forgo any kickbacks at the end of the 2014 season, according to documents.

The U.S. Department of State Diplomatic Security Service and Homeland Security Investigations also investigated the case.

Before agents swarmed Svihel's farm in May 2015, Bart tried to have Cabrera order workers to sign documents retracting statements made to Labor Department investigators about any illegal fees. But Cabrera never traveled to the farm because he was "concerned that some of the workers were angry enough with him about the fees that they would harm him," according to a trial brief.

Bart and Svihel also shared a list of workers that they separated into "good" and "bad" workers based on who they thought talked to investigators. Those on the "bad" list were sent back to the Dominican Republic first in 2014 and many were not invited back the next season.

As part of his June plea agreement, Svihel deposited $772,583 into a trust fund for restitution and agreed that his farm would participate in an enhanced compliance program through the end of 2017. Svihel will pay a neutral monitor to review his farm's H-2A visa compliance, and he agreed to make employees available to the government for confidential interviews. Failing to comply could result in the farm being prohibited from participating in the visa program.

Svihel's attorney, Susan Gaertner, said prosecutors are confident that he will treat his workers appropriately from now on — or they would have barred him from using guest workers.

About 60 guest workers remain on Svihel's farm while he awaits sentencing, about half of them from the Dominican Republic, with many others from Mexico, Gaertner said.

"The workers are harvesting veggies as we speak," she said.

Stephen Montemayor • 612-673-1755

Twitter: @smontemayor