Attorney General Cuomo Announces Arrest Of Saigon Grill Owners For Scheme To Cheat Workers And Cover Up Millions In Illegally Withheld Wages
NEW YORK, N.Y. (December 3, 2008) - Attorney General Andrew M. Cuomo today announced the arrest of the owners of the popular Saigon Grill restaurants in New York City for allegedly failing to pay its workers legal wages, taking illegal kickbacks from workers, cheating the state unemployment insurance fund, and for creating fraudulent business records to cover up their illegal actions.
Simon Nget a.k.a. Chang S. Nget, and his wife, Michelle Lu Nget a.k.a. Pei Ying Nget, are accused of numerous criminal charges based on their business practices at the Saigon Grill restaurants in Manhattan, located at 620 Amsterdam Avenue on the Upper West Side and 91 University Place in Greenwich Village, and formerly located at 1700 Second Avenue on the Upper East Side. The Ngets have owned and operated the popular restaurants since 1996.
The Ngets are also charged with attempting to intimidate the employees from pursuing a lawsuit to recover the unpaid wages by threatening to fire those who signed on. This led to the firing of dozens of workers, but the lawsuit moved forward, and a federal judge found the owners liable for millions in unpaid wages, citing the crucial nature of the delivery workers to the restaurants’ success on the Upper West Side and downtown
“Like so many restaurants across New York City, Saigon Grill was run on the backs of its workers,” said Attorney General Cuomo. “These workers allowed the business to thrive, and in exchange they were allegedly cheated out of wages, fined for ridiculous reasons, intimidated out of pursuing justice, and then pulled into a painstaking ploy to cover it all up. Today’s arrests should serve as a reminder to employers across the state-if you violate the law, you will be prosecuted.”
According to the criminal complaint, over the course of four years, delivery workers for the Ngets put in between 70 and 80 hours a week delivering orders for the restaurant well below minimum wage. In addition to the delivery workers, the complaint accuses Saigon Grill of employing dozens of kitchen and restaurant workers who they did not report at all and received illegal wages ‘off the books,’ cheating the New York State unemployment insurance fund.
To conceal their underpayments to workers, the Ngets then forced their workers to cash paychecks in their names and return the full amount of the check to the restaurants owners in order to create the appearance of paying lawful wages and legal bookkeeping, according to the complaint.
The Ngets also allegedly relied on faulty bookkeeping to cheat the New York State unemployment insurance and tax funds. Their quarterly tax returns, which are used to calculate unemployment insurance benefits, failed to report the employment of over 65 workers, effectively jeopardizing this financial safeguard for the workers, whose benefits may be delayed because of the owner’s failure to claim them on tax returns and costing the state the expense of having to recoup the money from the illegal employer.
Unemployment insurance provides temporary income for eligible workers who become unemployed through no fault of their own and who are ready, willing, and able to work. If an employer does not pay into the fund, it can be extremely difficult for a worker to access those benefits. Having failed to pay their share, mandated by law, the Ngets put their workers and their families in jeopardy and cheated taxpayers, who pay ever higher amounts to keep the system working.
The Ngets are charged with a total of 151 counts each of Falsifying Business Records in the First Degree, 45 counts of Tampering with Physical Evidence, and 46 counts of Offering a False Instrument for Filing in the First Degree, all class E felonies which carry a term of up to four years in prison. The charges are based on the Ngets’ creation of fake payroll records which they provided to the New York State Department of Labor during an initial DOL investigation of the Ngets’ minimum wage violations.
Stemming from these initial minimum wage violations, the Ngets are also charged with 11 counts of Failure to Pay Wages, 127 counts of Failure to Keep Records, and 16 counts of Receipt of “Kickback” Wages, all misdemeanors, for failing to pay their workers the minimum wage for four years.
In March of 2007, the delivery workers sued their former employers to recover their rightful wages. After some of the workers had signed an authorization to commence the lawsuit, the Ngets allegedly called a meeting of all Saigon Grill delivery workers and threatened to terminate delivery service altogether at both restaurants-which would have effectively put all the employees out of work-if they did not each sign a release of all wage claims. All workers who refused to sign the release were promptly fired. Based on these actions, the Attorney General is also charging the Ngets with nine counts each of Tampering with a Witness in the Fourth Degree, Coercion in the Second Degree, and Retaliation.
Josephine Lee, Coordinator of the Justice Will Be Served! Campaign, said: "It is about time that the Ngets be condemned for their reckless lawlessness. Such actions should not go unpunished. We hope that the government's treatment of these sweatshop bosses will justify the many years they have abused their workers and the public. We urge other bosses to take notice; and to right their wrongs immediately."
Sheebani Patel, Organizer of Restaurant Opportunities Center of New York, said: “All restaurant workers have the same rights, regardless of their immigration status, and should be treated with dignity by their employers. Saigon Grill's practices epitomize how so many owners mar the industry with poor practices that exploit workers. The workers should be saluted for their victory, and the Attorney General's office should be applauded for taking the abuses of restaurant workers seriously. This will have historic industry-wide ramifications in making the industry a better place to work in.”
These are the latest arrests in a string of criminal charges the Attorney General has brought against employers who fail to protect and compensate their workers. This case is being prosecuted by Assistant Attorney General Rachel Gold with Investigator Brian Ford of the Attorney General’s Office. This case is being supervised by Deputy Attorney General for Social Justice James Rogers.
The charges against the defendants are merely accusations and the defendants are presumed innocent until and unless proven guilty.