7-ELEVEN Franchises in Long Island, NY and Virginia were raided today one of the largest criminal immigrant employment investigations ever by the Department of Justice and the Department of Homeland Security.
Authorities said that the investigation is expected to widen to at least at least 40 franchises in seven states.
The Feds have seized 14 7-Eleven franchised stores so far, and have charged nine owners and managers with bringing in dozens of illegal immigrants from Pakistan and paying them using phony Social Security numbers.
Federal authorities claim that the workers were forced to work 100 hours a week for a fraction of their wages.
The undocumented Pakistani workers were given identities stolen from children and the deceased, according to Loretta E. Lynch, the United States attorney in Brooklyn.
At a press conference, Lynch stated "These defendants ruthlessly exploited their immigrant employees, stealing their wages and requiring them to live in unregulated boarding houses, in effect creating a modern day plantation system."
According to a report in the New York Times, the parent company was unable to detect the fraud, but has been cooperating with officials:
The conduct charged, officials said, had been going on since 2000, during which the defendants generated over $182 million in revenue. Twenty-five of the 40 additional 7-Eleven franchises under scrutiny were to be inspected on Monday as part of the ongoing investigation.
Officials said the parent company lacked enough internal controls to prevent the same Social Security numbers from being used to pay more than one store employee, which happened in more than one instance.
Scott Matter, a spokesman for the parent company, said it was aware of the arrests and seizures and “has been cooperating with federal authorities during their investigation.” Mr. Matter said the company would have no comment until it learned more about the case.
7-Eleven Franchisees Claim THEY are the one being exploited
On UnhappyFranchisee.Com, 7-Eleven franchisees have long claimed that it is they who are being exploited – by their franchisor.
7-Eleven franchisees pay a sizeable upfront franchise fee and deposit (about $190,000, on average) for the right to operate the store and split the ongoing profits with the franchisor.
Janice Anderson wrote:
Owning a 7-11 franchise is nothing but headaches and hard work 24-7. My husband and I have had one for about ten years now. Your employees are constantly stealing from you. You can’t trust anyone. Their cameras in the stores are a joke. They’ve taken away our gas profits and just keep chipping away at you. We’ve had tremendous employee theft. You have to count everything and watch your back constantly. It’s just not worth it . My husband is 61 and can’t take it anymore. Yes and you can forget about vacations, We’re on the verge of selling-GOOD RIDDANCE!
SEI’s new business transformation is further more complicated and isolates its franchisees with outside world so almost no interactions with vendors at all so that the company they use called Mclane to deliver groceries at our stores get big contract at all time and they alone bring most of the stuff so that SEI gets major kick back and incentives on each delivery.
Taking 50-53% of our profit was not enough and not they want kickback from our suppliers. Their accounting system is so bad that they control our gross profit and the percentage changes on their mood and sometime when we track it we are unable to determine how they calculate it…..and on top if it almost every month or every other month these guys take few extra dollars on maintenance cost from us which are so hard to get back and is a very simple steal for them and their field consultants are thoroughly trained to blame everything on us and if a store is doing good take credit for a great job for no reason …all they do is run few numbers for and 70% time spent with them is personal and useless talk.
PEOPLE DO NOT FRANCHISE 7-11 stores or I promise you you will cry or blood out…its stressful, painful and most importantly very injurious your and your family’s health.
I am currently franchisee. This company is nothing but SCAM. You are buying a boss. You pay 250k to buy a store. I know a store which got a breach for being 10 cents below equity. if you have 3 breaches, they take back your store. I HAVE SEEN SEVERAL STORES.
You can buy pepsi from out side 15 dollars a case. Pepsi delivers to 7-11 for $26 a case. So who is getting commission. THEY RIP OF SELLING YOU ITEMS.
If they give me and refund me 50% of franchisee fee, i will me more than happy to return the store.
I BEG YOU- NOT TO BUY 7-11. YOU WILL LOSE YOUR LIFE…YOUR SAVINGS- YOUR SOUL.. YOU WONT BE ABLE TO LAUGH OR CRY….HELL ON EARTH EXPERIENCE..
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