New York attorney general arrests construction firm owner for wage theft

Usually, crimes employers commit against workers are punished by nothing more than fines and financial settlements'and fines that often get bargained down to laughable levels, at that. So the news that New York Attorney General Eric Schneiderman has actually arrested a construction firm owner for wage theft and laundering stolen wages? That's real news.

Leonid Fridman has been arrested for not paying his workers the wages they were legally due on work at JFK airport in 2009 and 2010:

Under the Port Authority contract for the project and the Labor Law, the defendant was required to pay his employees over $50 per hour for Laborers and Mason Tenders and over $70 per hour for Tile Setters. According to court records, Fridman was aware that he was required to pay the prevailing wages but still paid his workers only $10 to $30 per hour.

To avoid detection, Fridman filed false certified payroll reports stating he paid his workers the prevailing wages and issued paychecks to the workers that matched those payroll reports. Fridman then made his workers cash the checks at his bank and kick back, or return, a majority of the cash to him. He hid over $100,000 of the money he stole by moving it into the account of a Florida corporation he controlled, Green Investments, Inc.

So those skilled workers were getting as little as 20 percent of what they should have been, so that Fridman could personally benefit. He was arraigned on one charge each of second degree grand larceny, second degree money laundering, violation of labor law, and 52 counts each of falsifying business records and offering a false instrument for filing. That's two class C felonies, one class D felony, and 104 class E felonies, and, if he is in fact guilty of these charges, the jail time he stands to receive is well deserved. Let's not pretend that wage theft'be it not paying overtime, not paying minimum wage or other legally required wages, just plain not paying'is anything but theft.

In the U.S. today, it's rare you see an employer face the kind of penalties they'd face for crimes committed against anyone but their employees. But in a just world, this arrest would be routine, not a standout event.