City probe shutters employment agencies accused in scam

The city shuttered three employment agencies as part of a months-long probe that revealed thousands of dollars were bilked from job seekers who shelled out cash for bogus fees, officials said Wednesday.

The Department of Consumer Affairs' 18-month-long investigation resulted in the collection of $160,000 in fines and more than $80,000 in restitution for the swindled applicants.

Consumer Affairs Commissioner Jonathan Mintz said dozens of agencies across the city had taken advantage of residents' hardships by charging illegal fees. Any agency asking for upfront payment for application or background fees "should raise red flags," Mintz cautioned.

No fees should be charged unless the agency actually helps a person find work. An advance fee or deposit is typically charged for certain jobs, including domestic, agricultural and household work.

The Consumer Affairs agency's investigation began more than a year ago when officials noticed an increase in complaints about job seekers paying for unfulfilled services.

The three Queens businesses the city shut down were Bella Guanga at 95-02 Roosevelt Ave., La Union at 80-06 Roosevelt Ave., and BCE Employment Inc. at 127-21 Liberty Ave.

Consumer Affairs inspectors reviewed contracts, applications and record books of more than 200 employment agencies citywide. Nearly 100 inspections, some conducted undercover, were executed and uncovered "widespread violations throughout the industry," officials said.

The violations included illegal fees, contract violations and the withholding of refunds.

Consumer Affairs settled with 159 employment agencies, requiring payment of a $500 fine and mandatory attendance at business training sessions on proper job placement and laws.

Mayor Michael Bloomberg, who with Mintz announced the probe and its results, said the city isn't against employment agencies legitimately helping residents hard hit during the economic downturn.

But the city wants to make sure that people using the agencies' services "understand what they're getting for their money," Bloomberg said.

Last week, Bloomberg announced a $4-billion budget shortfall for this year and the next, and the need to cut city jobs. The city's workforce will shrink by at least 3,000 jobs, with most of those jobs coming through attrition and some by layoffs.

In the wake of the fiscal crisis, city officials estimate the loss of between 145,000 and 165,000 jobs over the next two years.

Bloomberg said the unscrupulous employment agencies were targeting immigrants who don't read or speak English.

Consumer Affairs officials said no arrests were made but some agencies were referred to authorities for further investigation. The department will continue to conduct undercover inspections and will monitor the dozens of agencies pinpointed during the initial probe.

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City probe shutters employment agencies accused in scam