Construction company owner gets prison time, must pay nearly $30M for tax evasion scheme

PORTLAND, Ore. — The owner of a Portland-area construction company was sentenced to 30 months in federal prison for evading payroll and income tax of his workers.

The U.S. Attorney’s Office – District of Oregon said Melesio Gomez-Rivera, 49, of Aloha, was also ordered to pay nearly $30 million in restitution to the IRS.

Gomez-Riviera owned Novatos Construction. Court documents say that from January 2014 to December 2017, he and other construction company owners conspired with a locally-based check cashing business to defraud the U.S. by facilitating under-the-table cash wage payments to construction workers.

“To carry out the scheme, Gomez-Rivera and the other company owners cashed or had other individuals cash millions of dollars in payroll checks at various locations of [the] check cashing business, used the cash to pay construction workers under-the-table, and filed false business and payroll tax returns. In total, the group cashed approximately $192 million in payroll checks, causing a combined employment and individual income tax loss of $68 million,” the U.S. Attorney’s Office said.

In December of 2021, a federal grand jury charged Gomez-Rivera, the owner of the check cashing business – David Katz of Tualatin, and four other people with conspiring with one another to defraud the United States. Katz faced an additional four counts of filing false currency transaction reports with the treasury department.

Gomez-Rivera pleaded guilty in March of 2023; he was the first of the six co-conspirators to do so, authorities said. The trials of the remaining five will begin in December.