Man sentenced for mail fraud, harboring illegals, money laundering

2014-06-17T19:15:00Z 2014-06-17T23:50:18Z Man sentenced for mail fraud, harboring illegals, money launderingJim Masters Times Correspondent nwitimes.com
June 17, 2014 7:15 pm  • 

HAMMOND | The owners of the shuttered Paragon Restaurant in Schererville were sentenced in federal court Tuesday on charges of mail fraud, harboring illegal aliens and money laundering.

Michael McClellan, 40, of Richton Park, Ill., was convicted of three counts of mail fraud and single counts of harboring illegal aliens and money laundering. He was sentenced to 51 months in federal prison and ordered to pay restitution in the amount of $203,844 to the state of Illinois, said Special Agent Kerry Hannigan, spokeswoman for the IRS Criminal Division in Chicago.

McClellan’s wife, Tina McClellan, 38, convicted of one count of money laundering, was sentenced to one year home confinement and is jointly responsible for the restitution.

The McClellans were indicted in November 2012 on federal charges of harboring illegal aliens working at their restaurant and also for making false claims to the state of Illinois over the number of children who attended T&M Daycare, which they operated in Calumet City.

The federal indictment alleged Michael McClellan harbored illegal aliens at Paragon as well as at a home he owned behind the restaurant. The McClellans were accused of using illegally derived funds to purchase the home.

Michael McClellan submitted false quarterly reports that did not account for restaurant employees he had paid in cash, which the federal government successfully argued was all part of a scheme to defraud the Indiana Department of Workforce Development out of unemployment insurance tax contributions.

From 2006 through 2010, the McClellans received reimbursements of at least $200,000 from the state of Illinois and the Healthy Start program by falsifying the number of children who attended T&M Daycare, court documents stated.

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