TRAVERSE CITY -- Two men who led a company that provided illegal alien workers to the Grand Traverse Resort & Spa among a host of national clients entered guilty pleas in federal court in Grand Rapids.
Richard M. Rosenbaum, 61, and Edward S. Cunningham, 44, both of Florida, pleaded guilty to charges of conspiring to defraud the federal government and harboring illegal aliens in plea agreements with federal prosecutors. Cunningham entered his plea Friday and Cunningham on Oct. 17, and in exchange prosecutors agreed not to pursue similar charges in other parts of the country.
A multi-count indictment unsealed by federal investigators in February charged that the two men, head of Rosenbaum-Cunningham International (RCI), and a third officer of the company, provided illegal workers for cleaning and maintenance jobs for dozens of clients around the country. Investigators also alleged company officials avoided paying more than $15 million in employment taxes.
Besides the resort in Acme township, other clients of RCI included well-known chains like Planet Hollywood, Dave and Busters and Hard Rock Cafe. Investigators said RCI was paid more than $54 million for employment services between 2001 and 2005.
A former supervisor and two other RCI employees were also charged in the nation-wide investigation, as was Janie Schlagel, a former State of Michigan employee and local woman who pleaded guilty to a two-count indictment that charged her with trafficking false identification records.
Rosenbaum, who's been in federal custody since his arrest in February, faces up to 10 years in prison and a $500,000 fine. Cunningham, who's free on bond, faces a 5-year prison term and up to $250,000 in fines, and both face restitution amounts that could exceed $16 million, officials said. A sentencing date has not been scheduled.
The two men also forfeited bank accounts, life insurance policies and cash that totaled more than $5 million, federal officials said.
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