Travis Dorman and Jamie Satterfield | Knoxville

Buzz60

Chris Carlson, AP

Federal agents raided a Bean Station, Tennessee slaughterhouse Thursday after a months-long probe into allegations the owners were paying undocumented immigrants cash to avoid paying $2.5 million in payroll taxes in three years, federal court records show.

Agents raided Southeastern Provisions, a cattle slaughterhouse on Helton Road in Grainger County, as part of a probe into myriad claims of tax evasion and fraud involving millions of dollars in unpaid taxes in a scheme that could stretch back a decade.

IRS Criminal Investigation Agent Nicholas R. Worsham wrote in a search warrant affidavit that James Brantley and his wife, Pamela Brantley, who own the slaughterhouse and meat-packing firm, have been hiring undocumented immigrants since 2008 and hiding it from the IRS.

Worsham also alleges the Brantleys used their daughter and other employees in their fraud, lied to the IRS about how much they paid themselves and American employees, filed false tax returns and exploited its largely Hispanic and undocumented work force.

The Brantleys are not charged, though. They could not be reached for comment Friday, and it’s not clear from court records if they have hired an attorney.

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The U.S. Attorney’s Office is declining to comment on the raid or ongoing probe. Agents seized a slew of documents, electronics and computer hard drives, a search warrant return showed.

97 people found inside, 10 arrested

ICE officials reported 97 people were found inside the slaughterhouse when agents and Tennessee Highway Patrol troopers raided it. ICE said in a statement that “10 of those encountered were arrested on federal criminal charges.”

But there were no federal warrants or indictments related to the raid filed in the U.S. District Court electronic filing system Friday afternoon.

ICE said 86 people were held pursuant to an administrative hold to check immigration status. Of those, 54 were detained for further immigration proceedings.

The agency gave no other details about the raid or the detainees.

Worsham’s affidavit showed the plant owners and a handful of legal workers are the targets of the probe. It was Citizens Bank, where the Brantleys held accounts, that first tipped authorities to possible fraud, his affidavit showed.

“Bank personnel began noticing large amounts of cash being withdrawn from the Southeastern Provisions bank accounts,” the affidavit stated. “The cash withdrawals occurred on a weekly basis.”

Worsham later confirmed the Brantleys had withdrawn more than $25 million in cash since 2008 and told bank personnel they used the money “for payroll.” Although it’s not clear why, bank personnel “conducted a site visit” at the plant in December 2016 and learned the Brantleys had installed a vault to keep cash.

Agents later surveilled the Brantleys and employees as they made those weekly cash withdrawals. Worsham said the Brantleys withdrew $10.9 million in cash from 2013 to 2016 but only reported to the IRS paying workers $2.5 million.

The $8.4 million difference between what they actually paid workers in those three years and what they reported they paid means they pocketed $2.5 million in unpaid taxes, Worsham alleged.

The investigation

In May 2017, agents used an undocumented immigrant, labeled CI-1 in Worsham’s affidavit, to gather more evidence against the Brantleys. He was working as an informant for local law enforcement when agents asked him to get a job at the Brantleys’ slaughterhouse.

He was hired without providing any documents, such as driver’s license or social security card, the agent wrote. CI-1 was offered a supervisor’s job on the spot because he spoke Spanish and English, the agent wrote.

He was paid $10 per hour. His pay – given in cash – was handed to him in an envelope at the end of the work week, the affidavit stated.

He provided agents with intelligence about what he saw. He said there were dozens of Hispanic workers who were being paid in cash. They were forced to work overtime without pay, the affidavit stated, and exposed to hazardous chemicals without protective gear.

Many had been fired from another meat-packing plant in Morristown because of their lack of documentation of legal status, the affidavit stated.

The informant later snared video for the agents, Worsham wrote.

Immigrant advocacy groups cry foul

Advocacy groups on Friday decried the raid’s impact on undocumented immigrants.

The Tennessee Immigrant and Refugee Rights Coalition complained in a statement the workers “reported rough treatment and detention despite having work authorization.” ICE contends the detained workers did not have work authorization records.

“Children were left without primary caretakers, and local churches have provided sanctuary for dozens of others,” the group said in a release.

Stephanie Teatro, co-executive director of the group, blamed the Trump administration in the release.

“Our communities have lived under intense fear since the Trump administration began, and this raid – coupled with local law enforcement involvement – will send shockwaves across the country,” she said.

ICE said families of detained workers could check their status through the agency’s web portal.

Septic system failure

Southeastern Provision has a history of sanitation and safety violations. In March, the plant's septic system failed, leading to the contamination of well water in the area with coliform and E. coli bacteria.

The Tennessee Department of Environment and Conservation ordered the plant to shut down its underground wastewater system and haul its waste to an offsite treatment facility.

State officials provided well sampling to 12 households that "had the potential to be impacted," said TDEC spokeswoman Kim Schofinski.

Residents were forced to use bottled water as authorities worked to help them install treatment or tie onto public water systems.

"TDEC continues to provide technical expertise and oversight assistance at the facility," Schofinski said.

Representatives for Southeastern Provision could not be reached for comment Friday.