PUBLIC SAFETY

El Rodeo owners sentenced to home detention

Kristine Guerra
kristine.guerra@indystar.com

The owners of the El Rodeo restaurant chain who are accused of underreporting millions of dollars in sales received home detention sentences Monday following guilty pleas on multiple theft charges.

Francisco Salgado, 49, and Jose Melendez, 53, will each serve two years in home detention. Both have pleaded guilty to 10 counts of theft. A third owner, Abel Bustos, 52, who has pleaded guilty to two counts of theft, will serve one year in home detention. Each also will be on probation for one year.

Earlier the owners agreed to forfeit $4.5 million to state and local authorities.

The charges resulted from a months-long grand jury investigation at 26 El Rodeo and El Jaripeo Mexican restaurants in 10 counties, including Marion and Tippecanoe. According to the prosecutor's office, the owners did not report about $22 million in sales over a three-year period.

"Your actions, while they weren't violent," Marion Superior Court Magistrate Judge Stanley Kroh said during the sentencing hearing, "they are harmful to our community at large, which you are a part of."

Prosecutors had asked for a sentence of not more than 10 years for Salgado and Melendez and not more than four for Bustos. Marion County Deputy Prosecutor Janna Skelton said the sentences the three received are appropriate.

"It reflects the seriousness of the charges we've filed against them," Skelton said.

As part of a plea deal with prosecutors, the owners have paid about $1.8 million in unpaid sales, food and beverage tax to the Indiana Department of Revenue. The money came from the $4.5 million that the owners have agreed to forfeit to state and local authorities. The rest of the forfeited money is divided between the prosecutor's office and law enforcement agencies involved in the investigation.

Prosecutors alleged that restaurant employees used several methods to avoid recording sales. For instance, according to court documents, a cashier may put the total in the cash register, and then "zero out" that total and open the cash drawer to make the change.

The restaurant owners' attorney, Sean Hessler, said the owners are now making sure that each transaction is accounted for at all restaurants, which remain open.

"It's not in their best interest for this to happen again," Hessler said during the hearing.

He also said he wishes his clients received a lighter sentence because home detention will make it difficult for them to manage their restaurants. Before the sentencing, Hessler said the restaurant owners have led a "substantially law-abiding life."

The owners also have received letters of support from customers who have pledged to keep coming back to the restaurants, Hessler said.

All three, except, Salgado declined to make a statement during the hearing.

"Everything I've done all my life is work, work, work," Salgado said through a translator. He added that he's been working for 20 years to care and provide for his family.

Judge Kroh has agreed to consider lowering the charges from a Class D felony to a Class A misdemeanor if the three owners successfully serve their sentences.

The restaurant chain became the target of police raids and a grand jury investigation, which began in May 2013. Twenty El Rodeo and six El Jaripeo restaurants in Indianapolis, Greenwood, Carmel, Noblesville, Zionsville, Richmond, Lafayette, Plainfield, New Palestine and Lebanon were investigated.

Call Star reporter Kristine Guerra at (317) 444-6209. Follow her on Twitter: @kristine_guerra.