MOOSIC, Pa. — Note: The above video is from an earlier story.
A former director of a shuttered food services company in Moosic learned Friday he will spend nearly two years behind bars for taking more than $400,000 in bribes from staffing agencies in exchange for contracts worth millions of dollars, the office of U.S. Attorney Gerard M. Karam announced.
Mark Holmes, formerly the director of manufacturing for Preferred Meals Systems, also reportedly didn’t pay the IRS $135,000 in employment taxes owed by Encore Staffing Solutions, a staffing agency Holmes helped form in 2018 after his exit from Preferred Meals.
The 18-month federal prison sentence handed down by U.S. District Court Judge Malachy E. Mannion is below the recommended 33-to-41-month range set by the federal probation office, court records show. Philadelphia defense attorney Jonathan Sobel sought a reduction by noting Holmes’ lack of criminal record and his service in the U.S. Marine Corps during the late 1970s.
“He is a man of good character who will never make excuses,” wrote Dane Holmes, the defendant’s son, in a letter to Mannion. “He knows he made a big mistake. He needs to be given another chance.”
Holmes, 67, is one of seven people snared in a federal investigation that found two staffing agencies — Global Staffing Services, Inc. and Penns Independent Staffing — paid off high-level employees of the now-closed food services company on Birney Avenue in exchange for lucrative contracts.
Other than Holmes, former supervisor Jason Bonnewell, 41, allegedly accepted $150,000 in exchange for hiring Global Staffing and Penns Independent, federal prosecutors say. Former manager and director Jose Ortiz, 48, allegedly took $200,000 in kickbacks.
In exchange, the two staffing agencies received contracts worth well over $10 million. Prosecutors also allege the agencies failed to pay the IRS hundreds of thousands of dollars in employment taxes.
Holmes, now of Muskogee, Oklahoma, pleaded guilty in December 2021 to charges of commercial bribery and tax fraud.
Bonnewell, 41, of North Abington Township, pleaded guilty last month to honest services wire fraud and for failing to disclose cash income on his personal tax returns, according to authorities. He awaits sentencing.
Ortiz, 48, of Drums, entered a guilty plea Monday to conspiring to commit honest services fraud. He too awaits sentencing.
The federal probe also ended in criminal charges against management for Global Staffing and Penns Independent.
Danny Sing, who operated Global Staffing Services, was sentenced Thursday to 27 months of imprisonment. Sing, 61, of Philadelphia, pleaded guilty to conspiracy to defraud the United States.
Prosecutors alleged Den Lam, 49, of Philadelphia, and Nari Lam, 31, of Wilmington, Delaware, also conspired to avoid federal income tax. Den Lam, of Global Staffing, agreed to plead guilty and Nari Lam, of Penns Independent Staffing, was sentenced to three years of probation.
Madeline Nieves, 49, formed Encore Staffing Solutions with Holmes. Prosecutors alleged she failed to report wages to the IRS between 2018 and 2020 and owed approximately $67,000 in employment taxes.
Nieves, of Plains, pleaded guilty to tax fraud conspiracy and was sentenced to 15 months of imprisonment.
Federal prosecutors in charging documents did not identify by name the food services company that employed Holmes, Ortiz and Bonnewell. However, Holmes’ sentencing memorandum and LinkedIn profiles belonging to Ortiz and Bonnewell made clear the unnamed company was Preferred Meals.
Preferred Meals, which packaged food for schools and retailers, closed in 2022.
The closure eliminated hundreds of jobs. The Pennsylvania Department of Labor & Industry put the loss at 217 positions in Moosic, though employees at the time told Newswatch 16 it likely impacted even more.
The plant’s former parent company, Elior North America, said at the time they made the “difficult business decision to exit its prepared meals production and distribution business.”
Lackawanna County assessment records show Preferred Meal Systems Inc sold the Birney Avenue property in September 2022 for $7.5 million to an LLC tied to FW Logistics, an Illinois-based warehousing business.