I9-Verification

I-9 Audits: Problems for Horse Trainer Dale Romans (What Not To Do)

09.23.2013

Author

Jeff Aleixo

Dale Romans, an accomplished horse trainer and Eclipse Award winner, has been fined $150,000 after an I-9 audit (Romans is currently appealing the ruling).  In a recent article in the Courier-Journal.com, Romans is quoted as saying that he typically has as many as 75 employees at any time between his racetrack operations and his Lexington farm and was found to have issues with 58 employees over an unspecified period of time.  In short, an average fine of over $2,500 per “issue” employee!

Dale Romans’ career wins tally up at over 1,000 (and counting)…..unfortunately, he’s now taken a HUGE LOSS related to poor I-9 management!

image credit: Five Furlongs

In 2007, there were well under 300 I-9 audits. In 2012, there were over 3,000. 

With I-9 inspections occurring at a constantly-increasing pace (2012 saw the most I-9 audits of any year on record) being audited is (unfortunately) a position that more and more employers find themselves in. There are so many ways to foul-up the Form I-9, and when you multiply that by your total number of employees…statistically, the odds are stacked against an employer coming out ahead in an audit scenario.

All the more reason for savvy employers to be proactive in managing their I-9 processes and learn from the missteps of others.

The current violations Romans is facing are related to a 2011 I-9 audit, including fines for allegedly missing I-9s, improperly completed I-9s, and failure to respond. Penalties range from $100 to $1,100 per violation, which adds up quickly. In Romans’ case, he says he failed to receive three notice of violations, which were sent to his home rather than work address. Because he did not receive the notifications, he missed out on an opportunity to correct any problems.

Avoid Romans’ (Alleged) Mistakes:

1) Make sure your address of record is correct.

2) Conduct an audit of your I-9 records BEFORE the federal agencies come a’knocking. You often have an opportunity to correct problems with your I-9s. Ideally, before they occur in the first place, and next-best, carefully and within the letter of the law PRIOR to audit. The worst scenario is to let potential problems sit unaddressed like a sitting duck until you are audited.

3) Buckle-down on I-9 processes from on-boarding to post-exit record maintenance. In the past, if you were audited once you wouldn’t necessarily be audited again for a few years, but now being audited by one agency in one year can open you up to increased risk of audit for additional years and by multiple agencies.

4) Make sure you properly understand the law. Romans is quoted in this Bloodhorse.com article saying such things as:

“It’s just a paperwork issue,”

“….we try to have all the I-9s that we can,”

“……it’s not like it’s anything illegal….”

All of which could be said (has been said, will be said) by many other employers in his position. The problem is a lack of understanding that I-9 audits do in fact now very much focus on technical errors, “paperwork issues,” and that employers will be held responsible for having ALL necessary I-9s. Violations are in fact illegal. The sooner that more employers realize this, the better they will be able to avoid bleeding out money to pay for costly I-9 violations.

5) Related to the misunderstading detailed in #4, Romans admits to Bloodhorse.com thatattempting to handle the 2011 audit without seeking professional representation was “where we made the biggest mistake.” No doubt pound-wise and penny-foolish. Because of an inability to adequately understand employer obligations related to I-9 (and therefore accurately assess his risk), Romans says, “we thought we were in good shape and didn’t call anybody in to help us through the audit….” An expensive lesson to learn!

Save your own business trouble and expense by learning from these mistakes and do not underestimate I-9 audits.

This article cites “Romans Fined for Immigration Filing Glitch,” on Blood-Horse.com, by Jessica Oswald (5/17/13), and “Trainer Dale Romans fined by immigration agency, plans appeal,”  on Courier-journal.com by Gegory Hall (4/29/13).

 

Just in time for the revised Form I-9, download our Essential Guide to I-9 Compliance, which combines all of our most valuable I-9 tips and articles into a single resource.

 

Disclaimer: This article is general in nature and is not intended to replace the guidance of an employment tax expert and/or legal professional with regards to an appropriate course of action in your particular circumstances. Please consult with a professional for appropriate advice in your case. Pursuant to IRS “Circular 230” rules, any information included herewithin is not intended or written to be used for the purpose of avoiding penalties under the federal Internal Revenue Code.

Stay Up-to-Date
Subscribe to our newsletter and get news, tips, expert opinions and a range of resources straight to your inbox.